Up to 3,000 Billion bailout for pension funds looming

Up to 3,000 Billion bailout for pension funds looming

www.ft.com

Joshua Rauh, associate professor of finance at the Kellogg School of Management at Northwestern University said that, without reform, some state pensions might run out within the decade. By 2030, as many as 31 states may not have the money to pay pensions. And, if these funds exhaust their assets, the size of payments for the benefits they have promised will be too large to cover through taxes, putting pressure on the federal government for a bail-out that could potentially cost more than $1,000bn, he says.

“It is more than a local problem,” Mr Rauh said. “The federal government could

(visit the link for the full news article)

"Estimates put the unfunded liabilities at between $1,000bn and $3,000bn after years of states promising benefits but not contributing enough in both good times and bad to cover them."



[edit on 21-5-2010 by Ex_MislTech]

You got to love a new bailout that is quadruple the
$700 billion one !

As some economists warned the era of the never ending
bailouts has begun.

The debt will blossom to untold levels as more piling on
is piled on.

The only thing keeping the dollar from tanking totally is
that the Euro is not fairing much better.

Combined this with naked shorting of precious metals
with tax payer money and the collapse is becoming
more and more likely myself and many others have been
saying for years now.

This is just a slow motion disaster as the pirates are
using smoke and mirrors and paid off politicians to
see thru their plan to the bitter end.

As Mr. Perkins said, this is all by design.

Good Luck to you all !



www.ft.com
(visit the link for the full news article)

Could you post the entire article?

I'm not a member at FT and I can't see a thing.

Thanks...

But yeah, no way in hell those pensions will be paid. Here in Canada it's the same thing, basically we're like Japan, WAY too much old people collecting pensions and WAY too little young people to pay for those in taxes.

Originally posted by Ex_MislTech



As Mr. Perkins said, this is all by design.

Misltech
it is good the you quoted Perkins.
As it is all by design, I must ask if a politician were to have the stones to go after those who did the design, and carried it out, who would they be?

Originally posted by Vitchilo
Could you post the entire article?

I'm not a member at FT and I can't see a thing.

Here's another article from CNN Money, ...

Why State Pension Funds May Need a $1 Trillion Bailout

Even if they continue to rake in the projected 8% in annual returns, pension funds in at least seven states -- Illinois, Louisiana, New Jersey, Connecticut, Indiana, Oklahoma, and Hawaii -- could dry up by 2020, and 31 states could be in trouble by 2030, according to a recent study by Northwestern University economist Joshua Rauh.

Promised benefit payments are so astronomical that raising taxes would still fall short. The only solution would be to call on the federal government for a bailout, according to the study.

"This is a problem of monumental proportion," said Rauh, an assistant professor of finance at the Kellogg School of Management. "Given that we see the same issue in many states, the total size of a federal rescue plan could exceed the seriousness of the recent economic crisis and potentially cost more than $1 trillion total."

Is it ever gonna stop?

[edit on 5/21/2010 by Keyhole]