Unfunded Pension Liability and Bailing Out Blue States

[Elliott]

The proposed Biden $2 Trillion Pandemic bill includes about $350 billion for "states." I doubt the detail of the distribution to the states is specified, but here is an older chart of the pre-pandemic amounts. I think the question is how small states with smaller debt feel about their children's money going to states who did a poorer job in creating un-funded pension plans.

 

[glenn walker]

The Basement Man has to do it he has no way- Maybe a "Virtual Bailout " )

 

[alebrewer]

Cuomo has estimated NY's deficit at between $14B and $61B through 2024 - this should help immensely!

 

[IlliniApp]

Hasn't the Fed already said they are simply going to monetize all of this new COVID borrowing? After a long absence, inflation is a-coming. Many years ago I foolishly believed that there was a chance that the federal debt could be reduced. Now, in the short term does it really matter if the debt is 27 or 30 trillion $? Some day there will be a day of reckoning, it's just a matter of when.

 

[OSU Beavers]

Oregon has been kicking the PERS can down the road for decades. We are not in the top 10 but I am sure that Harris / Biden will bail them out.

 

[Mejappz]

Oregon has been kicking the PERS can down the road for decades. We are not in the top 10 but I am sure that Harris / Biden will bail them out.

No doubt. A good crime family protects its own.

 

[Alsie35]

These states should be forced to go bankrupt. The pain their mismanagement would cause downstream (aka to the holders of ridiculously large pension obligations) is the only thing that MIGHT force a change in government policy.

Except - that will never happen unless the whole economy is going down the tubes - because they will drag all of us down before they will reform these pension plans. As Jefferson adroitly observed, democracy ends as soon as people learn they can vote themselves $$$ from the public treasury. We are now seeing the same "government by bribe" that has been one of the historical hallmarks of the downward spiral of every great nation since history was invented.

 

[Charles West]

I doubt these states get bailed out. Joe's proposal has to pass the congress and that's going to be heavy lifting with the current configuration.

 

[Riick]

Joe's proposal has to pass the congress and that's going to be heavy lifting with the current configuration

Do you remember:
"You've got to pass it, to find out what's in it!"

It's the very same folks, just a different date on the calendar. There are even a few RINO members of the House & Senate to smooth the way, down the cattle chute, to the killing floor. All done in the name of equity and fairness.

 

[Fernando]

Pensions here take a big part of city's budgets. Years ago, government gave generous pensions. Maybe it was a way to attract employees from the private sector.
Now we are paying for it with most of city revenues paying the retirees leaving what's left for city services.
It's a problem that won't go away.