Posted on 09/13/2010 5:29:11 PM PDT by Libloather
How to Cheat a Retirement Fund
By ORIN S. KRAMER
Published: September 10, 2010
A FEW weeks ago, at the insistence of the Securities and Exchange Commission, New Jersey agreed never again to fraudulently hide its underfunding of the state’s public pension system. Meanwhile, in Albany, Harry Wilson, the Republican candidate for state comptroller, has asserted that — if you do the math the way any ordinary financial analyst or economist would — New York’s pension system is underfunded by tens of billions of dollars and that, as a result, the state is essentially insolvent.
These little tempests are likely to soon recur in many other states and cities nationwide, because so many governments have invested far too little money in their public pension funds. Retirement promises made to public employees represent a huge hidden liability for future taxpayers — helping ensure recurrent deficit crises for state and local governments.
The S.E.C. is now making inquiries about the underfunding of other public pensions, and its assertiveness is welcome. But this effort cannot ultimately fix the problem, because all the S.E.C. can do is force states to follow the budgeting rules that are set by the Governmental Accounting Standards Board. These rules offer, at best, only the illusion of transparency, because they allow governments to base their budgets on economic fictions.
Consider, for the sake of comparison, how private corporations, in measuring the value of the assets in their pension systems, are required to use real portfolio market prices. Government accounting standards, in contrast, allow public pension systems to measure their assets based on average values looking back over a period of years. In most instances those average values add up to a figure that is much higher than the amount of money the pension plan actually has.
(Excerpt) Read more at nytimes.com ...
*cough*socialsecurity*cough*
Want to know why the SEC went after NJ? Chris Christie.
Odd they never went after Schumer’s friend Bernie Madoff.
The taxpayers are BROKE. Good luck on collecting. These LIBTARDS are sooo stupid.
If I was a state worker...age forty...in any of these states with under-funded episodes, I think I’d be asking questions. There’s zero chance in twenty years that your state fund will be able to pay you. The unions are going to have serious issues in keeping their folks in line over this.
...and you can also thank service unions.....
Shouldn’t somone hang or at least do hard time for establishing these pensions, not funding them, and spending the money on everything else? Wasn’t this political thievery?
The biggest corruption in this country is all perfectly legal.
public unions have gotten themselves darwin awards.
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