Skip to comments.The Little State With a Big Mess
Posted on 10/22/2011 4:56:39 PM PDT by reaganaut1
After decades of drift, denial and inaction, Rhode Islands $14.8 billion pension system is in crisis. Ten cents of every state tax dollar now goes to retired public workers. Before long, Ms. Raimondo has been cautioning in whistle-stops here and across the state, that figure will climb perilously toward 20 cents. But the scary thing is that no one really knows. The Providence Journal recently tried to count all the municipal pension plans outside the state system and stopped at 155, conceding that it might have missed some. Even the Securities and Exchange Commission is asking questions, including the big one: Are these numbers for real?
Were in the fight of our lives for the future of this state, Ms. Raimondo said in a recent interview. And if the fight is lost? Either the pension fund runs out of money or cities go bankrupt.
All of this might seem small in the scheme of national affairs. After all, this is Little Rhody (population: 1,052,567). But the nightmare scenario is that Ms. Raimondo has seen the future of America, and it is Rhode Island. As Wall Street fixates on the financial disaster in Greece, a fiscal wreck is playing out right here. And the odds are that it wont be the last. Before this is over, many Americans may be forced to rethink what government means at the state and local level.
Economists have talked endlessly about a financial reckoning for the United States, of a moment in the not-so-far-away when the nations profligate ways catch up with it. But for Rhode Island, that moment is now. The state has moved to safeguard its bond investors, to avoid being locked out of the credit markets.
(Excerpt) Read more at nytimes.com ...
14 billion dollars?
Nothing to say, but wow.
“Before this is over, many Americans may be forced to rethink what government means at the state and local level.”
I decided that DECADES ago!
I want police & fire protection and EMTs. I want the trash picked up (but that’s optional; I’m able-bodied and can go to the dump, compost & recycle stuff) and I want the roads safe. I don’t mind funding a library with my tax dollars.
I want all public employees funding their own health care and retirement funds just as we do in the private sector. I want honest, legal and transparent elections at my Town Hall. I can live without a post office when the private sector can move packages and mail for me cheaper and more efficiently.
And that’s about all I need from government. That’s all anyone should need, IMHO.
The World is out of $$, principly because Western politicans made far more promises than they could keep. The Policy Wonks have known this for some time. In a few years it will be painfully obvious to everyone, including Joe Sixpack and his kin.
Rhodent Island only has so much cheese to go around for the destructive ‘Rats who greedily milked it dry. Or was it the Koch bros? (:
perhaps, given the level of utter stupidity among most politicians, your last sentence should read
it is painfully obvious to Joe Sixpack and his kin now.
In a few years it will be painfully obvious to politicians.
Oh, trust me, all the politicians know. But they want to keep getting re-elected, so they will do whatever it takes to keep the status quo going. But those measures are getting ever more ridiculous and extreme. They are pi$$ing in their pants hoping it won’t all blow up on their watch.
You left out the public school system — which is one of the biggest expenses for any state.
And will the residents of RI hold the Democrats responsible for this sham accountable and boot them out? Sincerely doubt it.
From the beginning, Rhode Island was a bad idea. Let’s give them back to Britain.
The decreased standard of living for many Americans is how the bill is coming due and being paid.
What will the retirees in Rhode Island do when there is no pension at all or when inflation turns it into a pittance?
That means defeating the union thugs, which as we see in Ohio and Wisconisn, is a bitter and bloody matter. The only thing that may bring reality home is to see some pension funds just go dry, like the city in Rhode Island and a few other harbingers around the country.
8.5% or 7.5% return ... get real, try about 1.5% if you are lucky.
It’s a Union state, for both private and public employees. Not surprising they’re running out of money, the state’s as liberal as they come.
Let's not pussy-foot around: it's a Catholic state. there's just something about Catholicism and corruption.
Just wait until Social Security and Medicare collapse. How many private sector plans include significant contributions from those?
And how many plans will survive the collapse in Treasuries and other prime securities after they are inflated into oblivion?
And how many of the remaining plans are going to survive government confiscation? After all, isn't it fair that we all share in government caused misery together?
$15B pension system?
Little Rhode Island?
Hey,cut it out. I guess people should have stayed in Ma and been persecuted by the Puritans.
No there isn’t.
What kind of people would name their colony Rhode Island when it’s joined to the mainland on three sides? :)
You eventually run out of Other Peoples’ Money.
It’s going to be ugly. Very, very ugly. These programs are totally unsustainable...but we’ve all known that for a long time and can’t get our legislators to do a flippin’ thing about it.
Your Average Joe is totally under-funded to live out the rest of his life as he’s used to - either via government or personal savings.
The same thing holds in MA; non-Catholic Dems, as well as Catholics are wedded to their political ideas, which they learned from the crib, and don't seem to want to challenge, in any way. I think some of it has to do with the fact that they're from immigrant families which came here in the late 1800s and early 1900s. When they arrived, it was Democrat groups that helped them assimilate, get jobs, and 'guided' their votes, so naturally, they felt more beholden to the Dems than the Republicans, and kept that loyalty all these many years. They still have the notion that it's the Democrats who are for the 'working man', and can't see that the policies of the modern Democrat party work against those who truly DO work hard and want to succeed and create some wealth for themselves.