Buffett says more bad news on pension funds during next decade

Comments (3)
JohnKrats wrote:

Thus sprach the billionaire who says we should pay more in taxes, yet, he fights the IRS tooth and nail at every turn.

Mar 01, 2014 3:12pm EST  --  Report as abuse
jw_collins wrote:

So then, if I read the article correctly, we have fiscal issues?

Mar 01, 2014 4:26pm EST  --  Report as abuse
JoshWeinstein wrote:

Warren Buffet is absolutely right. Just look at Illinois and Pennsylvania. Illinois pensions are underfunded by $100 billion and Pennsylvania by $50 billion.

Blaming the employees for this is a joke! The politicians promised the pensions, then they decided for decades that rather than contribute the state’s share, they would use that money to balance their budgets instead, leaving an IOU in the pensions. Well, guess what, those IOU’s are coming due.

The Republican response seems to be to blame the employees and specifically the unions for this whole mess. But how is it their fault? The politicians agreed to the pensions and then they didn’t properly fund them – they kept pushing the payments into future years. Now there are no more future years to push them into.

That is the whole problem with the way that government operates. The politicians currently in office can make all kinds of promises and borrow money to fund them. When the loans come due, they are long gone and someone else is left to deal with the problem. This worked for a few decades, but the financial crisis and aging population means this method will no longer work.

What now? Cities can go bankrupt, but states cannot. That leaves two options. Let the retired employees starve in the streets or raise taxes. Or a federal bailout??? The problem with that is that the federal government would almost no chance of ever recovering the money like they did with the TARP money (most of that has been paid back).

Mar 02, 2014 2:43am EST  --  Report as abuse
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