Thursday, March 05, 2009

The Public Pension Bomb


Hidden Pension Fiasco May Foment Another $1 Trillion Bailout

Taxpayers, get ready to pony up some more loot for public (black hole) coffers.

"The misleading numbers posted by retirement fund administrators help mask this 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."

[...]

"'There are accounting gimmicks in pension land which create economic fictions and which disguise the severity of the real problem,' Kramer says. 'Unfortunately, pension board members don’t have much of an appetite for disclosing inconvenient truths.'"

[...]

"'It’s pitiful, isn’t it?' says Frederick "Shad" Rowe, a member of the Texas Pension Review Board, which monitors state and local government pension funds. 'My experience has been that pension funds misfire from every direction. They overstate expected returns and understate future costs. The combination is debilitating over time.'"

(end of post; ignore continue reading statement below)

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