Every decade or so, we get a new “gap”. You remember the “missile gap”? Now, we have the “pension gap” — the difference between what sits in pensions funds and what is owed to retirees. But, who caused that gap?
It isn’t surprising that The Wall Street Journal would write:
Major U.S. cities emerged from the financial crisis with increasingly underfunded pension and retiree health-care plans, according to a study released Tuesday.
Cities employing nearly half of U.S. municipal workers saw their pension and retiree health-care funding levels fall from 79% in fiscal year 2007 to 74% in fiscal year 2009, using the latest available data, according to the Pew Center on the States. Pension systems are considered healthy if they are 80% funded.
The growing funding gulf, which the study estimated at more than $217 billion for the 61 cities in the study, raises worries about local finances at a time when states are also struggling to recover from the recession. Property-tax revenue dipped during the housing crisis, straining city finances amid a weak national economy.
Ah, wait a second, about that financial crisis…how did that happen? Oh yes, a small elite of greedy Wall Street financiers and bankers decided to run a very risky operation so they could get rich quick. And, boom, the whole thing came crashing down — though most of them walked away with millions and still have their jobs.
And you kind of wonder: why hasn’t there been a huge demand for those same people to fill in the gap they created? Take profits, including right out of their personal bank accounts, and put it into the pension funds that were robbed by their behavior. Sure, there is more that has to be done. But, that would be a fine start.