Public Pensions, Public Disasters

This week we will look with fresh eyes at an old problem: US pension funds, both public and private, are under-funded, and the situation is getting worse. And the US taxpayer is going to get to fund the difference. The recent slew of data on pension funds suggests that little is being done to correct the huge and mounting problems I have written about for years. Even the recent market upturns of the past few years have not been as big a help as it should have been. I wrote this over two years ago:

"...there is something north of $1 trillion dollars in equity assets in the 123 state pension funds covered in this [Wilshire] study. My back of the napkin analysis shows that pension fund estimates assume that the equity portion of the pension fund assets will grow by 10% or around $100 billion per year.

"That means in 7 years and at 10% compounding, they are assuming there will be approximately $1 trillion dollars…