"I’ve argued before that it is shorter-term cash considerations that pose a danger for pension funds, and that the system will not suddenly blow up, but rather slowly unravel. Looking at aggregate numbers is misleading...if enough of the 6,300 state and local pension plans fail, it will cause legal and political changes that will likely end the current system of partially funded defined-benefit plans for public sector employees. That could happen in the next recession."
Just read this article linked through another source. Great article, interesting points. My favorite quote is: “But what if it’s New Jersey, Illinois, New York City and Philadelphia defaulting in the next recession? These are all high-tax jurisdictions with declining middle-class services. When you toss in another reform since 2008, the restriction of federal income tax deduction for state and local taxes, it seems unlikely that taxpayers and citizens can kick in much to solve the problems; or that elected officials will ask them; or that they will stay put if asked. Their pension funds won’t run out of cash… Read more »
A largely unasked question is becoming glaring: Is Illinois doing all it should to use artificial intelligence to make government cost less and work better? So far, the evidence says no.
Just read this article linked through another source. Great article, interesting points. My favorite quote is: “But what if it’s New Jersey, Illinois, New York City and Philadelphia defaulting in the next recession? These are all high-tax jurisdictions with declining middle-class services. When you toss in another reform since 2008, the restriction of federal income tax deduction for state and local taxes, it seems unlikely that taxpayers and citizens can kick in much to solve the problems; or that elected officials will ask them; or that they will stay put if asked. Their pension funds won’t run out of cash… Read more »