Say Good-bye to Pensions for City Workers

If you happen to know anyone who works for the city (or state, or government)...this is a shot across the bow of their dreams for security.  ...Dennis

Detroit not alone under mountain of long-term debt 

Early this year, the Pew Center released a survey showing that 61 of the nation’s largest cities — limiting the survey to the largest city in each state and all other cities with more than 500,000 people — had a gap of more than $217 billion in unfunded pension and health care liabilities. While cities had long promised health care, life insurance and other benefits to retirees, “few ... started saving to cover the long-term costs,” the report said.

But, barring a settlement now with public-sector unions, it’s hard to see cuts not being part of Orr’s plan in Detroit: relying on a bankruptcy judge to rule that federal law trumps the state constitution. 

And such a ruling, once made, could change how public employees across the country see their futures, how their unions negotiate contracts, and how their retirees — some of whom, like police and firefighters in Michigan, don’t contribute to or receive Social Security benefits because their pensions were expected to be guaranteed — pay the bills.

The Pew Center calls it “the widening gap” and says it’s not going away anytime soon, and there won’t be any quick fixes.