Author Topic: Are Collapsing Pensions "About To Bring Hell To America"?  (Read 691 times)

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Offline SirLinksALot

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Are Collapsing Pensions "About To Bring Hell To America"?
« on: March 16, 2017, 06:13:13 PM »
SOURCE: ZERO HEDGE

URL: http://www.zerohedge.com/news/2017-03-16/collapsing-pensions-are-about-bring-hell-america

Authored by Mac Slavo via SHTFplan.com,



The toxic dollar is bringing hell in a handbasket.

Along with the student loan debt bubble and other major financial factors, the looming pensions crisis is bound to be the death of us all.

Because it’s based on a future promise to pay, it has long been a benefit dangled to solve strikes and union disputes – because, in the end, it is just more debt, whether private or public.

With tens of trillions in unfunded liabilities, the weight of an avalanche remains dangling over our heads. An aging population is cashing in on needed retirement benefits while the younger generations must support multiples that are unsustainable financially.

Somewhere between the retiree that needs clothing, food and lodging, and the bankruptcy of cities and state governments is the makings of the next economic crisis.

via AgainstCronyCapitalism.org:


Quote
This is one of those things that few will pay attention to until it’s a 5 alarm fire. Then the policymakers will run around with their hands in the air saying they didn’t see it coming.
 
Of course they did. But addressing the problem is hard and will make people unhappy in the short term.


This blog pointed out the sad, and quiet fact that entities like the government of South Carolina are deep in debt over pensions. Everywhere there are failing social systems.

And somewhere, the rubber is going to met the road, and people are going to get hurt.

As SHTF previously reported:


Quote
In 2014 a new Federal law made it possible for pension funds to cut benefits for their recipients.
 
n October of [2015] the canary in the coal mine fell over and died when Illinois announced that the State was posting pension payments because it ran out of money.
 
Fast forward a few more months and things have been taken to the next level. The Central State pension fund in Kansas became the first such fund to take advantage of the 2014 law as 400,000 Americans who depend on their monthly pension income to pay for such things as their mortgage, groceries and medical expenses saw an average of $1,400 per month sliced of their monthly benefits.


Unfortunately, there may be no avoiding some very painful lapses in checks in the difficult years ahead.

As Market Watch reports:


Quote
But take a look South Carolina’s government pension plan, which covers roughly 550,000 people — one out of nine state residents — but is a staggering $24.1 billion in the red.
 
This is not a distant concern, but a system already in crisis.
 
Younger workers are being asked to do much more to support the pensions of retirees. An analysis by the The Post and Courier of Charleston noted recently that “Government workers and their employers have seen five hikes in their pension plan contributions since 2012, and there’s no end in sight.” (Most now contribute 8.66% of their pay, vs. 6.5% before the changes.) At the same time, the pension fund has been chasing more stocks and alternative investments instead of relying on stable investments like bonds that may be much less volatile but generate only meager returns.
 
And if that’s not troubling enough, South Carolina’s pension fund is far from alone.


Yeah.

California’s Calpers public retriree system is notoriously underfunded and doomed to implode. Chicago, Detroit and other urban wastelands are sagging under abysmal debt. Dallas, Texas pensions went insolvent. Puerto Rico is nothing but a propped up holding corp(se).

Something massive has been swept up just under the carpet.

Offline Weird Tolkienish Figure

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #1 on: March 16, 2017, 06:45:09 PM »
NO BAILOUTS!
I am not a conservative.

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #2 on: March 16, 2017, 06:59:47 PM »

Can you say "Haircut?"
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Offline InHeavenThereIsNoBeer

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #3 on: March 16, 2017, 07:23:57 PM »
This is a great example of why I don't believe in governments taking on long term obligations.

If you or I take out a 30 year mortgage, we're on the hook for the next 30 years. 

If a polician (and by extension, the taxpayer) "guarantees" a public worker a benefit in 30 years, the ones making the promise generally aren't the ones on the hook politically or financially when it comes due.

If my grandfathers' generation made a promise to defend, say, South Korea, I don't see how my grandchildren can be expected to honor it.  They didn't make the promise, or even have met the people that did.

Online IsailedawayfromFR

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #4 on: March 17, 2017, 10:09:09 AM »
The #1 goal in this is that there is no such thing as a budget item being sacrosanct, including pensions.

It is just another line item, as countless employees of private companies have learned over the years in failed companies.
« Last Edit: March 17, 2017, 10:09:26 AM by IsailedawayfromFR »
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Offline Weird Tolkienish Figure

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #5 on: March 17, 2017, 10:17:46 AM »
The #1 goal in this is that there is no such thing as a budget item being sacrosanct, including pensions.

It is just another line item, as countless employees of private companies have learned over the years in failed companies.


If they had been given 401(k)'s or 403(b)'s instead of pensions they'd have little (or less) to worry about.
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Offline mirraflake

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #6 on: March 17, 2017, 10:26:04 AM »
A friend of mine is a school teacher and so is his wife. They were making approx 65k per year each.  Retired at age 53-54  and both receive approx 85-89% of their post retirement pay.

The husband after waiting for one year got another job  teaching so he gets his new salary plus his pension..

And they wonder why the system is going broke.

If I was dictator I would require all gov't employees to work to in age 62





Online IsailedawayfromFR

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #7 on: March 18, 2017, 04:06:56 PM »

If they had been given 401(k)'s or 403(b)'s instead of pensions they'd have little (or less) to worry about.
and neither would taxpayers as they would not absorb the obligation beyond the initial contribution
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geronl

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #8 on: March 18, 2017, 04:22:57 PM »
Public Sector Pensions: Government over-promised and under-delivered on these pensions. Not only did they promise too much but they refused to even fully fund them at the time. Taxpayers should not be on the hook for this, these contracts and the way they were handled are criminal offenses in my opinion.
« Last Edit: March 18, 2017, 04:23:21 PM by geronl »

Offline Weird Tolkienish Figure

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #9 on: March 18, 2017, 05:53:08 PM »
Public Sector Pensions: Government over-promised and under-delivered on these pensions. Not only did they promise too much but they refused to even fully fund them at the time. Taxpayers should not be on the hook for this, these contracts and the way they were handled are criminal offenses in my opinion.

They could, right now, take whatever cash is in the fund, divide it proportionally, convert it to a 401k, and call it a day. But they won't do that, they will kick the can as long as they can.
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Offline Elderberry

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #10 on: March 18, 2017, 06:12:13 PM »
A friend of mine is a school teacher and so is his wife. They were making approx 65k per year each.  Retired at age 53-54  and both receive approx 85-89% of their post retirement pay.

The husband after waiting for one year got another job  teaching so he gets his new salary plus his pension..

And they wonder why the system is going broke.

If I was dictator I would require all gov't employees to work to in age 62

I worked for 30 years as a NASA Subcontractor. I retired at 62 and my pension is approx 22% of my final salary. The company froze the pensions some ten years ago. Employees after that don't get pensions.

It makes me sick when I hear how cushy public pensions are.
Do not unto another that you would not have him do unto you. Thou needest this law alone. It is the foundation of all the rest.(Confucius)

geronl

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #11 on: March 18, 2017, 06:25:35 PM »
A friend of mine is a school teacher and so is his wife. They were making approx 65k per year each.  Retired at age 53-54  and both receive approx 85-89% of their post retirement pay.

Some of these public employees don't even have to contribute their own earnings to the pension either.

Online bigheadfred

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #12 on: March 19, 2017, 10:17:53 AM »
Some of these public employees don't even have to contribute their own earnings to the pension either.

I would say most. They are welfare recipients. And I object.

Offline Joe Wooten

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #13 on: March 20, 2017, 02:21:05 PM »
Some of these public employees don't even have to contribute their own earnings to the pension either.

And darn near all public pensions give out annual COL raises to those getting the pensions. No private sector pension still in existence does that.

Offline Free Vulcan

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #14 on: March 20, 2017, 02:48:23 PM »
Short answer is yes, yes they are. Studen loans too.

And keep an eye on the ag sector now that land prices are falling.
And a country boy will survive.

Offline thackney

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #15 on: March 20, 2017, 03:35:37 PM »
Short answer is yes, yes they are. Studen loans too.

And keep an eye on the ag sector now that land prices are falling.

Land prices are falling?
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Online IsailedawayfromFR

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #16 on: March 20, 2017, 05:38:32 PM »
Land prices are falling?
I subscribe to Progressive Farmer Magazine to stay on top of current farm and livestock news.

It conducts a farmer confidence survey and results are below.  With this level of confidence, I would not be surprised if land prices fall, at least on average for the ag sector.

Yearning to stay free takes place in many ways at many different times, whether by withstanding planes or bayonets

Offline Free Vulcan

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #17 on: March 21, 2017, 12:32:01 AM »
Land prices are falling?


Yep. Keep in mind that at least in Iowa, local and state govts derive revenue from property taxes, of which ag land is a significant part of that. Lower ag values, lower tax revenue.

And the banks of course are heavily tied in with the ag sector, particularly with small towns. Falling land prices erode their financial position.



Iowa farmland values fall for third year

http://www.thegazette.com/subject/news/business/iowa-farmland-values-fall-for-third-year-20161227
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Online Smokin Joe

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #18 on: March 21, 2017, 03:17:02 AM »
Land prices are falling?
Happening in boom towns, for sure. With 80% reduction in drilling rigs, rents have dropped significantly, and locally they overbuilt housing so the price is dropping. Typical post-boom curve so far. Minerals won't go with the land, but that's a given any more here.

Wages are dropping, too. Grandkids and their friends are informing me the burger flippers who once got 15/hour are down to 12-13, no sign on bonuses, and no housing allowance. (IOW, things are getting 'back to normal' in town). Walmart is the hot job, at $16/hr in the non oil patch sector for entry level folks.
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Offline thackney

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #19 on: March 21, 2017, 08:11:48 AM »
Yep. Keep in mind that at least in Iowa, local and state govts derive revenue from property taxes, of which ag land is a significant part of that. Lower ag values, lower tax revenue.


While in some areas the prices are in multi-year declines, in others multi-year increases in value.  Overall, the average US farmland price has risen until last year, with a very slight decrease.  The average price is up nearly 20% from just 4 years ago.

@Free Vulcan , @IsailedawayfromFR , @Smokin Joe ,

Farm Real Estate, Average Value per Acre
http://usda.mannlib.cornell.edu/usda/current/AgriLandVa/AgriLandVa-08-05-2016.txt

2012:  $2,520
2013:  $2,730
2014:  $2,950
2015:  $3,020
2016:  $3,010
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Online Smokin Joe

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Re: Are Collapsing Pensions "About To Bring Hell To America"?
« Reply #20 on: March 21, 2017, 08:29:40 AM »
North Dakota: 1,160     1,550     1,820     1,920     1,830

It's dropping now, nearly $100 in the last year.
« Last Edit: March 21, 2017, 08:30:23 AM by Smokin Joe »
How God must weep at humans' folly! Stand fast! God knows what he is doing!
Seventeen Techniques for Truth Suppression
And I looked, and rose up, and said unto the nobles, and to the rulers, and to the rest of the people, Be not ye afraid of them: remember the Lord, which is great and terrible, and fight for your brethren, your sons, and your daughters, your wives, and your houses. Nehemiah 4:14 (KJV)

About the only "Big" Liberals don't revile is "Big Government"


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