In May 2006 the Kentucky Long-Term Policy Research Center released a short summary on Retiree Crisis Looms as Pension and Health Care Benefits Vanish. In that summary, an aggregate unfunded liability of nearly $296 billion was reported in a survey conduced by the National Association of State Retirement Administrators and National Council on Teacher Retirement. Failure to make actuarially sound investments was cited as the root of most shortfalls. Since the time the investment market has suffered severe declines and our financial infrastructure is in question.
In an April 6, 2009, Kentucky.com article, State pension funds feel hit, the Center for Retirement Research at Boston College estimated that pension funds now need $270 billion in additional contributions over the next year and more than $100 billion annually for two decades. States' pensions have collectively lost over $1 trillion in the market over the past year. Kentucky's pension shortfall is estimated around $27 billion.
Millions of private sector workers are unemployed. The public sector workforce has not been proportionally reduced. Is it right or fair to expect Kentuckians to shoulder through more taxes the ever increasing burden of the rich benefits enjoyed by the state and local public workers, police and teachers?
Isn't it time for Kentucky's leaders to really address the rich public employee benefit problem like they were accountable to keep Kentucky fiscally viable?
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