Pension systems on the brink
A train wreck waiting to happen. That’s the only way to describe the mess that state pension systems are in right now, according to a report published today by the Pew Center on the States. According to Pew, there’s a $1 trillion gap between the $3.35 trillion in pension, health care and other retirement benefits states promised their current and retired workers as of fiscal year 2008 and the $2.35 trillion they have on hand to pay them.
What’s worse, the gap may be even higher given that the study was conducted prior to the market collapsing in 2008 and given the way most states allow for smoothing of investment gains and losses over time.
How did this come to pass? And more importantly, what can be done to solve it?
Ditto….interesting article. It would be nice to see all states broken out.