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OpenMarket: Pensions

  • Cheers to Department of Labor for Protecting Retiree Investments

    July 29, 2020
    At the end of last month the Department of Labor published a new notice of proposed rulemaking on the investment choices that private pension fund managers are allowed to make on behalf of their beneficiaries. The most proposed rule would clarify when it is possible to use environmental, social, and governance considerations when investing on behalf of pension fund beneficiaries.
  • How Accounting Reform Can Help Address Public Pension Underfunding

    August 27, 2019
    By deferring compensation, in the form of pensions, and pushing those costs well into the future, politicians can gain favor with government employee unions, which are major political players and donors, while passing on the pain of paying for said compensation on to their successors.
  • Underfunded Public Pensions Put Future Taxpayers on the Hook

    August 9, 2019
    One of the most well-known and enduring lessons of public choice economics is the dynamic of concentrated benefits and diffuse costs. Well-organized groups have both the incentive and ability to lobby government for benefits for themselves, paid for by taxpayers at large, who lack organization and whose individual payouts toward said benefits aren’t large enough to prompt them to expend much effort opposing this arrangement.
  • California Supreme Court Upholds Pension Reform, Punts on 'California Rule'

    March 7, 2019
    On Monday, March 4, the California Supreme Court, in a unanimous decision, upheld a major provision in the state’s 2012 pension reform legislation, but punted on the broader question of whether pension benefits are protected as contracts under the state constitution—and therefore cannot be altered.
  • Pension Obligation Bonds No Panacea for State Budget Liabilities

    February 27, 2019
    Illinois has a new governor and Chicago will soon have a new mayor—and the same old underfunded public pensions. Inheriting a predecessor’s debts is never fun, but the need to address them is unavoidable. The question is how, and there is both a right way and a wrong way.
  • Warren Buffett Warns about Unfunded Public Pension Liabilities—Again

    February 27, 2019
    Would you invest in a state with large unfunded pension liabilities? Warren Buffett likely wouldn’t. In a long interview with CNBC this week, the famed billionaire investor was asked by viewer, “How do you see the unfunded pension liabilities across the United States affecting our economy over the next 10 years?”
  • Real-World Effects of Pension Debt

    February 21, 2019
    Debates over public pension finance often have an abstract quality, taking place outside most people’s immediate concerns. Yet, the real-world effects can be quite tangible. That’s because underfunded pension plans can take up taxpayer dollars that could have gone to public services.
  • Wishful Thinking Is No Way to Address Public Pension Shortfalls

    May 22, 2018

    More state revenue but less money for public services?

    That’s the situation in which states with large unfunded pension obligations can find themselves if they don’t take significant steps to address those shortfalls. And that situation, bad as it is, could quickly get worse.

  • Could Janus Ruling Open the Door to Pension Reform?

    February 27, 2018

    This week, the U.S. Supreme Court heard oral argument in case Janus v. AFSCME, which could significantly impact unions representing government employees. A ruling in favor of plaintiff Mark Janus, an Illinois social service worker, would free public employees across the country from being required to pay for union representation as a condition of employment.

  • In Illinois, Public Pension Funding Cannot Keep up with Pension Benefits' Growth

    February 6, 2018

    Public pension shortfalls result from too little money being paid into the pension funds. Or so government employee unions and their political allies would have you believe, when they ask taxpayers to pony up more to pay for pension benefits. Yet left out of this picture is the growth of those benefits.

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