Skip to content
Catholic Online Logo

By Catholic Online (NEWS CONSORTIUM)

8/7/2013 (1 year ago)

Catholic Online (www.catholic.org)

Aging workforce putting strain on pensions as many plan to retire

The problems that plague Detroit may soon become the bane of all major U.S. Cities. As an aging workforce plan to retire, stress is being placed on the pension system across the United States. Years of underfunded retirement promises to employees, which sent Detroit into crisis mode could now plunge other cities into a financial hole.

In spite of the recent national economic recovery, most states are still falling behind in closing their pension funding gaps.

In spite of the recent national economic recovery, most states are still falling behind in closing their pension funding gaps.

Highlights

By Catholic Online (NEWS CONSORTIUM)

Catholic Online (www.catholic.org)

8/7/2013 (1 year ago)

Published in U.S.

Keywords: Pensions, budget cuts, Detroit, obligations


LOS ANGELES, CA (Catholic Online) - Questionable accounting practices coupled with overly optimistic investment assumptions, many U.S. Cities have unknowingly dug a financial hole for themselves. Due to a new set of government accounting standards, however, may send many officials waking up "to a house on fire." 

"Sadly, [Detroit] is not the only municipality in trouble," Glenn Hubbard, economist, Columbia University Graduate School of Business dean and Mitt Romney campaign adviser, told CNBC. "A lot of state and local governments have too much debt, too generous public pensions. We need a national conversation on how to fix this."

Among the most pressing questions that must be addressed is: who will pay to clean up these financial messes? The most likely candidates include millions of retirees owed trillions of dollars in benefits, the bondholders who lent states and cities trillions more or local taxpayers who will pay in order to see deeper cuts in public services.

The problem is not about to just go away. "Moving pension plans is like steering a blimp: You turn the wheel and you go six miles before it starts to turn," John Tuohy, Arlington County, Va., deputy treasurer says. Tuohy chairs the pension committee of the Government Finance Officers Association. "In the political process, that kind of patience is very difficult."

Thankfully, many state and local governments have set aside enough money to make good on promised retirement benefits. Seventeen states have funded more than 80 percent of their projected pension liability, a level that's generally seen as financially sound. Most of the rest have been scrambling to make up investment losses inflicted by the 2008 market collapse and the shortfalls in sales, property and incomes taxes produced by the Great Recession.

In spite of the recent national economic recovery, most states are still falling behind in closing their pension funding gaps. Thirty-four states have seen their pension funds stretched further as they've failed to make the full contributions needed to meet the obligation of retirement promises. Shortchanging those contributions increases the risk that the fund eventually will go broke.
Hawaii, Alaska, Kansas, Rhode Island, New Hampshire, Louisiana, Connecticut, Kentucky and Illinois have now set aside less than 60 percent of what they need. Illinois has saved just 43 cents to cover every dollar of what it needs to pay 350,000 retirees and 500,000 current plan participants who are counting on a pension check.

Unions are adamant that the City of Detroit needs to "man up" and make good on promises made to public employees.

"Our members were promised certain things," Tom Ryan, president of the firefighters' union in Chicago says."They enter dangerous situations every day, and the only thing they want to look forward to when they can no longer perform their duties is to be able to retire with some sort of security. People expect us to be there, and we are always there. We expect that the city holds up their end of the bargain when we signed on to be firefighters and paramedics for the city of Chicago."

Without a pension check, public sector workers face a bleak retirement as many are ineligible for Social Security.

"If we were talking about doing this to people with Social Security there would be rioting in the street," Ryan says. "But because it's public servants on pensions it seems to be OK to do this."

---


Pope Francis: end world hunger through 'Prayer and Action'


© 2014 - Distributed by THE NEWS CONSORTIUM

Pope Francis Prayer Intentions for September 2014
Mentally disabled:
That the mentally disabled may receive the love and help they need for a dignified life.
Service to the poor: That Christians, inspired by the Word of God, may serve the poor and suffering.



Comments


More U.S.

St. Michael the Archangel, Defend Us in Battle: Pope Francis Takes on the Devil Watch

Image of

By Deacon Keith Fournier

Now the new People of God is the Church. That is the reason she considers him her protector and support in all her struggles for the defense and expansion of the kingdom of God on earth. It is true that "the powers of death shall not prevail", as the Lord assured ... continue reading


Need milk? Eggs or flower? The Post Office may have you covered Watch

Image of Amazon partnered with the USPS to provide daily grocery deliveries to people in the San Francisco Bay area, a program the USPS wants to extend to the rest of the country.

By Catholic Online (NEWS CONSORTIUM)

The U.S. Postal Service has revealed a new plan to reverse its six-year streak of billion-dollar losses, which is as ingenious as it is simple. LOS ANGELES, CA (Catholic Online) - The USPS wants to deliver your groceries to you, and the agency sent this proposal to ... continue reading


Where the buffalo roam... Native Americans plan return of free range Bison on the American Great Plains Watch

Image of Bison calves are playful and eager to roam free.

By Catholic Online (NEWS CONSORTIUM)

Buffalo are part of the American west. Across the vast prairies of the Great Plains, herds grazed and migrated, crisscrossing the open grasslands in great, thundering tides. Each year, some of these buffalo were hunted by Native Americans who used everything, from ... continue reading


What did he drink to stay alive? Prison guards suspected of murder after inmate dies of thirst Watch

Image of Investigations continue into the death of a mentally ill man at a North Carolina prison.

By Catholic Online (NEWS CONSORTIUM)

A mentally ill North Carolina man died of thirst after being placed in solitary confinement for 35 and having the water to his cell shut down by prison officials. LOS ANGELES, CA (Catholic Online) - Michael Kerr, an inmate at the Alexander Correctional Institution ... continue reading


Who Are the Mother and Brothers of Jesus? We Are Watch

Image of The Father of Jesus becomes our Father also, as we enter, through Him, into the inner life of the Trinity. He underscores this truth right before He ascended when He instructed Mary of Magdala to tell the disciples

By Deacon Keith A Fournier

In this exchange, Jesus opens up for those with eyes to see and ears to hear the deeper interior importance and meaning of the motherhood of Mary  and the interior meaning of all family relationships renewed by the Holy Spirit. He gives to those with ears to ... continue reading


Oklahoma City beheader linked to radical Islamic groups Watch

Image of Alton Nolen, the Oklahoma City man who decapitated his coworker last week had attended a local mosque with ties to radical Islamist groups.

By Catholic Online (NEWS CONSORTIUM)

Alton Nolen, the Oklahoma City man who decapitated his coworker last week had attended a local mosque with ties to radical Islamist groups. Suharto Webb, an Imam with ties to former Al Qaeda mastermind Anwar al-Awlaki, had been the leader of the Islamic Society of ... continue reading


The Lesson of Herod: Developing Our Spiritual Senses Watch

Image of As we receive the Lord Jesus today - as we read and reflect on His Word and feed on His Body and Blood in the Holy Eucharist - let us enter into the communion of prayer. Ask the Holy Spirit to open the ears of our hearts. Ask the Holy Spirit to open the eyes of our heart. Then we will see the Lord with eyes of living faith and hear Him as He speaks.

By Deacon Keith A Fournier

In the Christian tradition there is a body of beautiful reflection on what are called the spiritual senses. These senses, in a way, parallel our physical senses. Through prayer and intimate communion with the Lord we can cultivate ears to hear the Lord speak to ... continue reading


Last year, Obama let 300,000 Muslim immigrants into the USA. Security concerns develop. Watch

Image of The Islamic State can easily sneak into the U.S. via the southern border, or tap into the growing pool of foreign born Muslims living in the United States.

By Catholic Online (NEWS CONSORTIUM)

Over the last three years the number of immigrants in the United States has jumped by 3%, a new study from the Center for Immigration Studies reveals. LOS ANGELES, CA (Catholic Online) - In 2013 there were a record high of 41.3 million immigrants in the U.S., and ... continue reading


Thousands of Catholics in Oklahoma City join procession against satanic Black Mass Watch

Image of A heavy metal rock band lent their support to the black mass in Oklahoma City -- which reportedly only drew about 42 worshipers.

By Catholic Online (NEWS CONSORTIUM)

Thousands of Catholics from across the United States gathered at the Saint Francis of Assisi Church in Oklahoma City to defy Satanists who were holding a "black mass" nearby. More than 600 people filled the church for a prayer service led by Archbishop Paul ... continue reading


Former Crystal Cathedral undergoing Catholic makeover Watch

Image of The Diocese of Orange purchased the Crystal Cathedral in February of 2012 from the Protestant community which founded it.

By CNA/EWTN News

The Diocese of Orange announced Wednesday the new design plans for Christ Cathedral, saying they are intended to transform the former Crystal Cathedral into a space that is "liturgically and intrinsically Catholic." (CNA/EWTN News) - "Through this innovative ... continue reading


All U.S. News

Newsletters

Newsletter Sign Up icon

Stay up to date with the latest news, information, and special offers

Daily Readings

Reading 1, Job 3:1-3, 11-17, 20-23
1 In the end it was Job who broke the silence and ... Read More

Psalm, Psalms 88:2-3, 4-5, 6, 7-8
2 may my prayer reach your presence, hear my cry for ... Read More

Gospel, Luke 9:51-56
51 Now it happened that as the time drew near for him ... Read More

Saint of the Day

Saint of the Day for September 30th, 2014 Image

St. Jerome
September 30: St. Jerome, who was born Eusebius Hieronymous Sophronius, was ... Read More

Inform, Inspire & Ignite Logo

Find Catholic Online on Facebook and get updates right in your live feed.

Become a fan of Catholic Online on Facebook


Follow Catholic Online on Twitter and get News and Product updates.

Follow us on Twitter