It’s a threat nearly everywhere in the world: that unsustainable public pension debt, promised to government employees in response to perceived flush times or under duress from unions, will bankrupt states and municipalities, forcing taxpayers or investors to foot the bill. Sovereign pension obligation is a major factor threatening the viability of the euro. And American states and cities—still coping with a stagnant economy and indebted by runaway entitlement spending during the so-called boom years—are faced with the choice of raising taxes, cutting services popular with constituents, or, as in the case of Detroit, Michigan, bankruptcy court. The scary thing is, in their desperation for a way out, governments are crafting so-called solutions to the problem of unsustainable pensions based on the same falsehoods and poor choices that got them there in the first place.
By silveristhenew | Published April 30, 2014
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