After we discussed two weeks ago the utter mess of the New York State Public Pension Funds, it seems finally more and more people are starting to focus on this issue truly important issue. Bloomberg today is out with an "exclusive" discussing the up to $1.5 trillion potential bailout to make sure public workers and retirees health and penions funds' do not go up in smoke as the market is dead set on hitting 0 or bust. Bloomberg notes:
The misleading numbers posted by retirement fund administrators help mask [the] reality: Public pensions in the U.S. had total liabilities of $2.9 trillion as of Dec. 16, according to the Center for Retirement Research at Boston College. Their total assets are about 30 percent less than that, at $2 trillion.As we have noted previously, this is without doubt among the most pressings issues for the administration (after figuring out how to prevent everything from collapsing into the spreading AIG singularity) that has long gone far too unnoticed. We recommend reading this rather lenghty piece to see just how huge of a risk the pension underfunding is and is guaranteed to become. Sphere: Related Content
With stock market losses this year, public pensions in the U.S. are now underfunded by more than $1 trillion.
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6 comments:
Come now Tyler, it will certainly be on the order of hundreds of billions of USD per year shortfall and it'll be a big problem, but that's still not "without doubt the most pressing issue."
CFRR (in Nov '08): Based on this accrued liability measure, our estimate is that firms are going to have to increase contributions by about $90 billion in 2009... If companies were granted extensions, the amortization period could be extended to ten years, and the required annual contributions would be somewhat smaller.
ok, fine. will give you that one... did a gentle rephrasing
Thank you sir, you are truly Project Mayhem-worthy.
http://pensiontsunami.com/
"That approaching wave of pension debt is bigger than it looks. The purpose of this site is to provide an overview of the multiple pension crises that are about to drown America's taxpayers."
Great, so now all of us how have seen our 401ks cut by 60-70% are going to have to pay higher taxes to make sure that the states can still pay out 100% of their "way to generous to begin" with pension programs.
Any chance that pension payouts get cut as a way of narrowing the gap? No way; we wouldn't want to put self interested politicians in the position of making some difficult decisions in the name of "everyone pitching in" to solve the problem. Just tax / inflate our way out and stay elected.
Can you say haircut...........
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