July has been a tough month for public-sector pension apologists who have denied, and continue to deny, that there is a nationwide pension crisis. Ratings agencies, bond buyers, academics, journalists, legislators and taxpayers alike are finally beginning to grasp the magnitude of the public pension debt tsunami that will, over the next several years, swamp state and local governments. For those of us who have been actively involved in the pension reform movement — including the tireless publishers of www.pensiontsunami.com — this awakening to the very real perils we collectively face is both a welcome and a sobering development.
Traditional defined benefit pension plans make long-term, guaranteed commitments to public employees and then fund those commitments through a combination of annual contributions and investment returns. The higher the assumed investment return, the less money is required upfront to pay for the benefits. And there’s the rub.
To continue reading RSI Board Member Dan Liljenquist's special commentary to the Deseret News, click here.