Somebody here wanted talk about policy. Here's some,

Posted on: October 18, 2016 at 07:56:47 CT

of many, that I have mentioned numerous times. So talk. Especially you dums, who love this kind of gov't waste.
And yes, it could bankrupt the country. CCC baby. Its the only way.


Will Looming State And Local Government Pension Crisis Bankrupt The U.S.?

Of all the problems faced by cities and states, none is so costly as public employee pensions. Yet, most Americans don't realize they're on the hook for trillions of dollars in unfunded pension liabilities.

A new report by the American Legislative Council, or ALEC, warns that state and local governments are $5.59 trillion short when it comes to funding their public employee pensions. That's an alarming amount -- equal to roughly $17,427 per person, or $69,700 per family of four, ALEC says. That's a lot of dough.

But the amount varies widely by state.

Alaska for instance is tops, at a whopping $42,950 per person, followed by Ohio ($28,538), Illinois ($28,200), Connecticut ($27,653), and New Jersey ($26,288). Tennessee, meanwhile, is at the bottom, with a mere $7,246 per capita. The bottom five is rounded out by Indiana ($8,573), Wisconsin ($9,156), Nebraska ($9,159) and North Carolina ($9,599).

Now here's the troubling part. No matter what state you live in, you're going to pay for it. All of it. Unlike your 401(k), IRA, or company pension, public employee pensions are fixed by law.

"Given that pension payments to retired state employees are guaranteed, taxpayers are ultimately responsible for making up any funding deficit," the report states. At some point, a judge will order your taxes raised to pay for these pensions. And the tax hikes will be huge, meaning you will have less to save for your retirement. This will certainly lead to civil disobedience -- perhaps even violence.

If you're wondering how this happened, the answer isn't simple.

First, public employee unions negotiated fat pension contracts with politicians and government bureaucrats who had no skin in the game -- they could promise anything to buy union peace, since they weren't paying for it.

Then, to keep this fraud going, they overestimated returns on pension investments, while they underestimated how much money would have to go in. Today, there's just 35 cents invested for every dollar owed. And in 2013, only 21 states actually made the contributions required by law.

These things happened in state after state, city after city, and county after county -- enough so we can say it's a pattern of fiscal malfeasance. In the private sector, this would be fraud. In the public sector, it's business as usual.

"The nature of defined benefit pensions in the hands of politicians will never change," wrote Rachel Greszler, a senior policy analyst in economics and entitlements at the Heritage Foundation's Center for Data Analysis. "There will always be pressure to shortchange pensions and pass the buck to future taxpayers."

Some of he damage to come can't be undone. But states and cities should be going back to their contracts and renegotiating for future retirees. And we should be holding public officials that underfund promised pensions to a higher standard -- one involving criminal culpability for those who betray the public's trust.