1 Aug
New Jersey has updated their listing of retirees in the state pension system. As of March, 2017 there were 325,937 retirees getting annualized benefits of $10,465,934,978. As of June, 2017 there were 328,932 retirees getting annualized benefits of $10,562,840,926.
Breaking down these retirements by year* we see an interesting pattern:
30 Jul
Watchdog.org had a piece on the Bernie Madoff story as told in the HBO documentary “The Wizard of Lies“:
A strong case can be made that public pensions are eerily similar to a Ponzi scheme, and that a similar collapse in some of the most underfunded systems in the country might be inevitable. That would mean an untold number of new victims that would make the Madoff case seem relatively minor by comparison.
The difference between a Madoff-like Ponzi scheme and the public pension crisis is that government is complicit in the latter, and that dedicated public servants, state retirees and taxpayers are the ones at risk.
I have been making that case for years and I see parallels between this:
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and this.
25 Jul
Pensions & Investments covered it but no other media outlet seems to take the institutionalization of theft by government bureaucracy as newsworthy. The sad part is that the participants in the United Furniture Workers Pension Fund A are hardly alone. According to a spreadsheet created from 1,234 Schedule MB filings for 2015 there are 333 other multiemployer (union) plans with larger deficits.
The Pension Benefit Benefit Guaranty Corporation (PBGC) keeps track of troubled multiemployer plans and form 5500 filings have these MB actuarial certifications but you have to know what to look for. Here it is….
21 Jul
On August 17, 2016 trustees of the United Furniture Workers Pension Fund A out of Nashville, TN became the eighth multiemployer (union) plan to file for benefit cuts under MPRA in an attempt to avoid insolvency. That application was withdrawn on February 21, 2017 and resubmitted on March 15, 2017. Yesterday they got their letter.
20 Jul
Governing calls it creative:
In New Jersey, the state is pledging its lottery — which an outside analysis determined was valued at $13.5 billion — as an asset to state pension funds. The action would reduce the pension system’s $49 billion unfunded liability and improve its funded ratio from 45 percent to about 60 percent, according to State Treasurer Ford Scudder.
It is also a gimmick testing the limits of stakeholder credulity.
Continue reading
18 Jul
This time it is in the Pew Charitable Trusts long-term analysis of how well state revenues matched expenses between fiscal years 2002 and 2015 which concluded:
New Jersey had the largest deficit, with aggregate revenue able to cover only 92.4 percent of aggregate expenses, followed by Illinois (94.3 percent). They were the only two states with aggregate shortfalls exceeding 5 percent of total expenses, and the only ones with annual deficits in each of the 14 years.
The Pew report went on to clarify:
16 Jul
Ranking states by fiscal condition, as the Mercatus Center has done for FY12, FY13, FY14, and now FY15 based on state data reports, gives us a clue as to what an apathetic public might owe for public pensions, retiree health care benefits (OPEBs), and regular debt but since factors for calculating the values of pensions and OPEBs are questionable (and likely understated) while repudiation is probable to varying degrees the public remains mostly in the dark there.
Whereas borrowing by states in the bond market is relatively transparent, benefit costs fall prey to the actuarial/political delusion machine resulting in this trend:
Union County Watchdog