As Trump would say, exorbitant pension funds are killers.
Is there any city big or small that doesn’t have this problem?
Force a sale of most of the city owned properties—leave a few parks to set up tents for the city managers to have a place to do what they do.
New York City should be able to hold out until 2026, Los Angeles will likely go in 2022, Seattle in 2020, Chicago again in 2019 to name but a few.
Let them go broke....cut the pensions in the bud.
Just raise taxes! /s
Here is the problem with pensions for police and firefighters: The job is physically demanding (and emotionally draining), and they can’t work past a certain age. You can’t have 50-year-old cops trying to chase down and wrestle a 20-year-old guy. So, what to do? You can’t turn them loose with nothing.
Now pensions for bureaucrats who create nothing but paperwork and hassles... that’s a different matter.
The real problem with all of these government (and oftentimes private sector) pension funds is that its very politically expedient and self-serving to “kick the can” on reality by overinflating the “Expected Portfolio Return” estimates on how well the funds will perform. I once did an analysis on about 10,000 days of data over 40 years of start dates (abt 1962 to 2002) where I looked at how an investment in 10 year Treasuries would have done compared to an investment in the S&P 500 (with dividends and returns on top). In approx 480 instances (approx 4.8%) the S&P 500 investment would’ve outperformed the 10 year Treasuries investment by 5% or more; and on average by about 2% more.
Dallas has a built-in assumption that the “Expected Portfolio Return” will be 9.0%. So does my municipal fire/police pension fund. And so many funds all around the country tend to do their estimates in this range. In reality they should be doing their “Expected Portfolio Return” assumptions at around 4-5%. But they don’t because its not politically expedient to do so.
Right now the US Treasury 10 year bond is yielding approx. 2.34% so any pension fund manager who claims they can expect to do better than 7.34% is either ignorant or crooked.