Tuesday, May 04, 2010
Debate on the other debt crisis Our view: Ugly truth about state pensions begins to emerge
...Last month, a panel from Stanford University concluded that California's public employee pensions were underfunded by $500 billion. That's about $35,700 per California household. Nationally, the American Enterprise Institute estimates that state pension funds are more than $3 trillion short.
The problem is twofold. Many states have lavish programs that allow workers to retire in their 50s with ample pensions — and health insurance to cover them until Medicare kicks in. Second, regardless of how generous their benefits, some states have simply failed to put away adequate funds to cover them.
These lavish programs are a good deal for public employees and politicians seeking their votes. But the deal is a bitter pill for taxpayers, most of whom are private sector workers without the types of benefits that state and local workers see as their right.
The first thing that must be done is to acknowledge the colossal irresponsibility of lawmakers who have engineered a massive transfer of wealth from non-unionized workers to unionized ones....