But by one estimate, state and local governments owe their current and future retirees roughly $375 billion more than they have committed to their pension funds. And that may well understate the gap: Barclays Global Investments has calculated that if America’s state pension plans were required to use the same methods as corporations, the total value of the benefits they have promised would grow 22 percent, to $2.5 trillion. Only $1.7 trillion has been set aside to pay those benefits. (New York Times, Tuesday)
Imagine if a private company did this.
FEE Timely Classic
Political Accounting by James Bovard