Growing Deficits Threaten Pensions

[flashl]

Accounting Tactics Conceal a Crisis For Public Workers

The funds that pay pension and health benefits to police officers, teachers and millions of other public employees across the country are facing a shortfall that could soon run into trillions of dollars.

But the accounting techniques used by state and local governments to balance their pension books disguise the extent of the crisis facing these retirees and the taxpayers who may ultimately be called on to pay the freight, according to a growing number of leading financial analysts.

State governments alone have reported they are already confronting a deficit of at least $750 billion to cover the cost of the retirement benefits they have promised. But that figure likely underestimates the actual shortfall because of the range of methods they use to make their calculations, including practices that have been barred in the private sector for decades.

Local governments use these same techniques for their pension funds and face deficits that further contribute to what some investors and analysts say may be shaping up to be a massive breach of faith with a generation of public employees.

Washington Post

[glowing]

1. Well, most of these towns and cities and counties and states were

swindled into investing in the stock market on the hedge funds.. so they are losing big time.

[abelenkpe]

8. kinda like

Is that true? If so: It make getting rid of social security and putting all our money into the stock market not quite so appetizing.

I wish we all had pensions still rather than 401ks.....

[glowing]

10. Its what happened in Florida. .. Ole Jeb Bush's company took the state

retirement funds and invested them thru hedge funds (this was after he left office.. His company acted as the middle man). So Bushie made money. The state lost big time. Of course, barely a bit of news about it.. a little bit here and there.. Why because the state is run by pigs.. So teachers, fireman, policeman, etc are going to be screwed.

On edit.. this kinda ties into why Elliot Spitzer was outed with his affair... to protect Wallstreet and cap the story...

[Double T]

2. When YOU lay down with fleas, YOU can be certain the dog will bite YOU in the ASS!!

[Lasher]

3. A direct consequence of Junior's tax cuts and subsequent reduction of funding to states.

Somehow people have gotten the idea that reneging on benefits promised to retirees is a viable option.

[mac2]

5. All the money is for war profiteering.

Heck with our seniors and children.

[Lasher]

9. Half as much on 'defense' would still be too much.

At some point you need to ask yourself, "Why do we spend as much money on our military as all the rest of the world combined?"

[notesdev]

6. It's not only a viable option

it's the only option. Too many promises have been made with too few dollars backing it up; all based on the rosiest predictions derived from politically adjusted numbers. All these pension programs were put in place by people who knew well that they would be long gone before called on to pay up.

I understand that this isn't the easiest thing to come to terms with, but the only alternative is to figure out where the money is going to come from... and if you look at all the possible sources, nothing short of all-out nationalization of the private wealth of the country is going to be sufficient to raise that sort of cash. If you think Social Security is the 'third rail' of politics now, just wait 'til someone tries to float that one.

[Lasher]

7. False dilemma

Bigtime.

[notesdev]

11. That's not much of an argument

How about telling me where you think the money is going to come from? Remember, Social Security itself is only the tip of the iceberg - pension plans are above and beyond that, and such plans have been very generous for a long time.

Money doesn't grow on trees. And I for one, as a non-baby-boomer, fail to see the wisdom of making any further sacrifice in order to further enrich that wealthiest generation in American history.

[Lasher]

12. You are entitled to your ridiculous opinion.

Maybe you didn't know that a false dilemma is a fallacy in which only two alternatives are considered, when there are other options.

Thank you for pointing out that money doesn't grow on trees but I already had a pretty good handle on that. Good luck cheating the old geezers out of the pensions they have earned. Maybe you can buy a new sailboat.

[notesdev]

13. Don't see you offering any third option

and I really would need to get a sailboat first before I get a 'new' sailboat, now wouldn't I?

[Lasher]

14. I didn't think I would need to point out what is obvious.

I can see I was wrong about that.

Upthread I said the plight of state pension funds is "A direct consequence of Junior's tax cuts and subsequent reduction of funding to states." Here is a link to that reply so that you won't have trouble finding it among the fourteen replies that currently exist. Now wouldn't you think we should at least consider repealing the Bush tax cuts and restoring federal allocations to states that existed in 2000? Since cutting off these funds has been the cause, with the current plight of state pension funds being the effect, it is obvious that this remedy would improve their fiscal condition. If you think such a step would require significant sacrifice on your part, you are either among the wealthiest 10% of Americans, or you have no idea who benefited from the Bush tax cuts.

And please don't embarrass yourself by hauling out some trickle-down bullshit about how the economy would collapse if Paris Hylton had to start paying taxes like rich people did before Junior came along.

Social Security is in good health and the only crisis is one that has been manufactured for people just like you, to recruit public support for rightwing plans to gut the most successful social program in our history. Stealing subsistence income from the elderly and infirm so that you can redirect your payroll taxes into your own personal account that would look like a 401(k) is not the only viable option. The privatization snake oil, besides being morally reprehensible, has been thoroughly discredited and there are few left who are foolish or selfish enough to fall for it.

The best alternative for Social Security is no make no changes.

BTW, unless you plan on buying a 'used' or 'pre-owned' sailboat I would think you would be getting a 'new' one, wouldn't you?

[mac2]

4. Seniors on fixed incomes can't make it.

It's not their fault. The cost of living index used is a lie so they don't get more. The housing markets in Florida, North Carolina, reflect the loss of retired moving there. They are trying to cope with health costs too. Many die from lack of good care. Many homeless trying to pay for their operations, etc.

John Ashcroft broke many state budgets with his fake terrorist alerts. Yet he walked away without prison.

President "Don" Bush continues to out source our resources and jobs. Our corporations became international refusing to pay taxes. We even give them tax money when they are making billions in profit. People have lower paying jobs so they don't pay as much tax. Congress gives Bush their duties and he does with our treasury what he wants (mostly steals it for himself and his friends). DA!