Saturday, June 16, 2012

Rats on the West Side, Bedbugs uptown !!!!

Ok, go to the video at the bottom of this post, hit play, ignore the annoying ad, crank up your speakers, and start reading.  Here's something from Reason magazine, via a link from Glenn Reynolds:

Tacking on overtime is only one of a long list of union-won perks behind New York's rising pension burden. To dodge a federal law capping public pensions to $195,000 a year, in 1997, Albany created a second fund for "excess benefits." Twenty-eight New York employees, nearly all teachers, exploited the loophole, leaving taxpayers with a $6 million check this year alone.

A prediction....  Next on the list will be Illinois and California.  They're going to go broke.  Shattered, Shattered.  Shadoobee, etc.... 

These and other sweeteners are part of the reason why the city's annual pension payout has increased 900% since 2000. And that's before health care benefits are included. For every dollar police officers contribute to their retirement, taxpayers contribute nine. Mayor Bloomberg's office warns that if one thing pushes New York City into bankruptcy again - 35 years after the last time - it will be pensions.

A prediction.... Next on the list will be Illinois and California. They're going to go broke. Bloomberg isn't worried about that as much as he's concerned about your right to purchase more than 16 ounces of Coca-Cola at once.  Rats on the West Side, Bedbugs uptown !!!  Shattered, Shattered....Go ahead, bit the Big Apple. 

As Gov. Paterson pins budgetary balance partly on more federal money, and lawmakers throughout the state struggle to balance the books, they have no further to look than their own legislative records for the cause of New York's growing fiscal stress. What is perfectly legal in New York's pension systems is also not fiscally sustainable. [...]

No, retirements that last longer than employments are not "sustainable".  And yet NPR's "Sustainability Desk" remains curiously quiet on the subject.  BTW, Illinois and California are going to be broke as the 10 Commandments in a few years....

Technically estimated at $452 billion as a result of flawed accounting, the real unfunded pension obligation in state pension plans is closer to $3 trillion.

The bill is now coming due.

It's also coming due in California and Illinois, BTW.  They're going to go broke. 

Professor Joshua Rauh of Northwestern University projects that even if public sector plans earn 8% on their investments, four states - Illinois, New Jersey, Connecticut and Indiana - will run out of assets to pay retirees by the end of the decade. States and local governments will soon find themselves up against a painful tradeoff: between closing schools and libraries and cutting other essential services or paying inflated pensions to 50-year-old retirees.

Here's the Stones.  Rats on the West Side, Bedbugs uptown, this town's in tatters.  Even if New York, California and Illinois are going broke, this stuff here, the soundtrack to my high school years, it'll give you a great case of Happy Feet. 


Hot Sam said...

The 8% rate of return on plan assets is a farce, defended only by politicians in denial and the CBPP.

Most private sector pension funds use the rate of return on investment grade corporate debt - more around 4-6%. At that rate, many of the states are already bust beyond repair.

The Whited Sepulchre said...

Yeah. I'm just wanting to get my money down on NY, CA and IL.
I got really frustrated with all the pols and economists claiming that they "predicted the housing crisis".
It was as predictable as the "Beanie Baby Crisis". (Those haven't held their value either.)

There seems to be a good market for those who have a good grasp of the obvious and can prove it afterwards.

BTW, the Eurozone is dead, the U.S. is going to have a major fiscal upheaval, historians will look back on Obama as a silly person, if Republicans take the presidency and Congress their spending level will be higher than Obama's, and Quentin Tarrantino's next movie will be awful and dull but I'll go see it anyway.