The CalPERS cow has mastitis.
The CalPERS cow has mastitis.
Texas is trying to get a handle on its pension problems before it turns into a California situation. For years, the legislatures did pension planning with an assumed 8% return on investment. There's no safe investment that can guarantee that kind of return, but it allowed legislatures to balance the budget by putting less into pension funds. When facing a budget shortfall, legislatures would often up the projected rate of return on pensions until they could balance the budget. GM did the same thing, promising great pensions, but not securing the money when the debt was incurred.