This article was first published at TheNewAmerican.com on Monday, Augusts 4, 2014:
In a nearly 4,000-word lead article on Sunday, the New York Times clearly articulated exactly what is wrong with the city’s five separate pension plans: too-optimistic investment assumptions, excessive fees, overly generous pension benefits, and political interference. Mere tweaking on the margins will only delay the inevitable Detroit experience: drastic benefit cuts for retirees and higher taxes on taxpayers.
In 2000, the city’s contributions to its five pension plans (general city workers, police, firefighters, teachers, and other school personnel) consumed just two percent of the city’s budget, and the plans were considered to be adequately funded. For instance, the plan insuring the city’s general workers was actually overfunded by 36 percent. Today those pension plans soak up more than