This year, judges in California and Michigan approved the exit plans of two of the largest municipal bankruptcy filings in the country’s history. In California, Stockton upheld its obligations to the state’s pension system behemoth, Calpers, while paying its other creditors as little as pennies on the dollar. Detroit, meanwhile, was able to restructure its obligations to all of its creditors, including city pensioners. While the exit plans differed, both judges ruled similarly: public pension obligations could be shortchanged like any other debt.
Stockton and Detroit aren't alone. Cities and states across America are facing catastrophic budget shortfalls. After decades of promising municipal employees pensions and healthcare benefits, municipalities do not have the savings to pay them out. According to a Pew report released last year, some cities had only 50 percent of the funds needed to cover pension promises, and Charleston, West Virgina, had only 24 percent funding. Now, paying off these shortfalls—and serving the debts incurred—is taking up a growing portion of municipal budgets, at the expense of essential public services.
1 comment:
And the budget-breaking pensions are mostly going to cops, who get between twice and four times what other civil-service pensioners get.
Leaving aside factors that kill the rest of us too, nearly every cop will live to collect that wonderful military-style - in some case even better - pension.
Is it any wonder that they'd rather shoot us than take even the least risk?
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