We Need to Talk About Public Pension Liabilities | Short Clips

I want to talk to you about three words that should scare the heck out of you especially if you're young public pension liabilities that's the reason this is so scary because almost no one is paying attention millions of Americans are in danger of not being able to maintain their standard of living in retirement and the problem is getting worse that's because fewer companies nowadays provide their workers pensions when they retire so what is a public pension liability a pension is a guaranteed lifetime payment to someone after they retire pensions used to be a big deal in the private sector every major American company had them but they became too expensive and companies have taken steps to phase them out fewer companies nowadays provide their workers pensions when they retire however pensions still live on in the public sector among employees of the government and they're eating city and state's budgets alive more and more money that could go to tax cuts or better services is instead being shoveled aside to pay for these benefits why is this happening over decades politicians have promised trillions of dollars intentions to government workers that includes police firefighters teachers and city and state officials you name a government job and there's a pension associated with it and many workers get such low paid during their working lives that they haven't been able to save for retirement [Music] now you may be wondering how big are these payments many pensions are quite large in California more than 62,000 retired public employees are receiving pensions of over $100,000 per year sometimes it's even crazier our retired New York City sanitation worker is getting two hundred eighty five thousand dollars per year a retired county administrator in California receives over four hundred thousand dollars per year remember these are guaranteed lifetime yearly payouts they haven't been able to save for retirement now we love our public employees they do vital work for our local communities and the wider society they deserve competitive pay and retirement benefits but currently many cities are in effect paying for multiple public departments at the same time the department is working now and because people are living longer a generation or two of retirees the system amounts to a self-perpetuating corrupt merry-go-round public sector unions give large donations to candidates who are then responsible for negotiating how much of your money goes to public sector workers these arrangements not only promise high salaries in the short term but they also hide the payments that will be due down the road when it will be much too late the results are predictable state and local governments across the u.s. openly admit to 1.4 trillion dollars of unfunded pension liabilities or eleven thousand dollars per household unfunded means dollars that have been promised but there's no actual money in the bank and that's just the amount they admit to the real number according to the Federal Reserve is much larger around four trillion dollars or $32,000 per household thank you for watching this video to help keep Prager you videos free please consider making a tax-deductible donation you