The factors that led to Dallas pension fiasco are all too common. Politicians and their administrations often make decisions that are politically beneficial without taking into account financial reality. A generous pension scheme keeps workers and their unions onside, helping the politicians win re-election. However, the bill for the generosity is deferred beyond the current political generation, with unrealistic assumptions of future returns enabling the problem to be obscured. As financial markets tend to go up the escalator and down the elevator it is not until a market crash that the unrealistic return assumptions are exposed and the funding ratio collapses.
You May Also Like
One of the favorite arguments of the establishment is that Texit supporters are “fringe,” and our movement doesn’t represent a majority. New polling by...
Dan Patrick has been on a tour campaigning for Lieutenant Governor throughout Texas. A Texan put him on the spot about his support for...