We have posted several times about the pension problems in the US. Particularly state and city funds. Caused by (1) extravagant promises, and (2) underfunding.
Read the rest at the link.Along with the student loan debt bubble and other major financial factors, the looming pensions crisis is bound to be the death of us all.
Because itís based on a future promise to pay, it has long been a benefit dangled to solve strikes and union disputes Ė because, in the end, it is just more debt, whether private or public.
With tens of trillions in unfunded liabilities, the weight of an avalanche remains dangling over our heads. An aging population is cashing in on needed retirement benefits while the younger generations must support multiples that are unsustainable financially.
Somewhere between the retiree that needs clothing, food and lodging, and the bankruptcy of cities and state governments is the makings of the next economic crisis.
This is one of those things that few will pay attention to until itís a 5 alarm fire. Then the policymakers will run around with their hands in the air saying they didnít see it coming.
Of course they did. But addressing the problem is hard and will make people unhappy in the short term.
This blog pointed out the sad, and quiet fact that entities like the government of South Carolina are deep in debt over pensions. Everywhere there are failing social systems.
And somewhere, the rubber is going to met the road, and people are going to get hurt.