Plenty of blame to go around -- read some of the comments. State and city governments are very culpable here as are the public unions. Should not be allowed to have public unions it's a total conflict of interest as this crisis shows.

Munis got hurt bad in the crisis in 2008 and basically had to have government administer them if I recall correctly. What a mess that was. I didn't know what was going to happen to my munis for several weeks.

I agree. It is hard to have sympathy for most of the people receiving reduced pensions. They obviously did not pay attention 30 years ago to know that the math did NOT add up and demand accountability. Nor did they save and invest like they should have. I know retirees who are receiving upwards of $10k per month from the local electrical workers union. While new hires will receive no more then $4k for the same time worked. Think about this disparity adjusted for inflation in 30 years! This is a consequence of the Baby Boom generation living in large off the backs of their children. Unconscionable and unacceptable.

I also have a hard time feeling sorry for most teachers who either explicitly or tacitly supported these corrupt public teachers unions and have spent us into oblivion with their pension benefit schemes. If they had been reasonable and not layered in millions of bogus administrative jobs I would have more sympathy. Also re teachers US test scores are terrible and the youth are much less competitive than 20-30-40 years ago.

Totally agree. The politicos just steal anything stashed in a government-controlled account like they have with pensions. Better to have the person in control and to get rid of defined benefits.

Once the real pension crisis hits they will print like crazy. Only way to save the Federal pension schemes I would think. City and state governments might face the reckoning sooner and have to make benefit cuts. Any way you slice it if you are a private sector 401k investor or a government pensioner you're going to get back less than 50% of what you put in, inflation-adjusted, and it might eventually be pennies on the dollar.

On top of that they layered in countless comfy but needless administrative jobs for their cronies who get even bigger benefits putting pressure on the entire state funding programs.

I don’t think Raoul is a boomer! :)

haha...We are squarely Gen X as founders.

GenX...the Forgotten Generation :))

They are almost exclusively Democrats, correct?

You got it. Public services unions think the money gravy train just goes on forever and they can just tax the state residents to make up any shortfalls. And the that government is the solvers of all problems when it clearly is not, and in fact is a wasteful, inefficient and bloated bureaucracy that one should be very Your point #2 is very important. It used to be that public workers exchanged lower current income and benefits for long-term job security. While the private sector had better salaries and benefits. Now that is clearly not the case as public workers have job security, the same healthcare benefits, pension schemes...whereas private workers have zero job security & can be fired on a whim, generally have no pension, and have similar (if not worse) healthcare benefits and salaries.

Defined benefit schemes are exactly the problem here. 401ks are vastly superior for the state and the citizens who own them. What this video leaves out is how the public unions end up pulling the strings re who gets elected, then have these usually Democratic politicians award themselves big pension and benefit schemes and layer in administrative layers of bureaucracy everywhere. This creates a huge, bloated system that cannot possibly afford all the benefits promised. I feel sorry for these people, but given the poor performance in schools and crazy social policies they have implemented in the school systems it's not hard to see that drastic changes in the system need to be made, including the elimination of defined benefit schemes (to be replaced by defined contribution). But all the public unions will NEVER allow that -- watch the RV video on the California state pension. They will always push for more salary raises and pension benefits until the taxpayer literally can't pay anymore.

Just paid my 3 year plus subscription but did feel that I should have bee grandfathered until my subscription ran out in April. Real vision is worth the money but I feel that the product was reduced after I already paid for it.

Yes, this format used to be Grant’s bread and butter, but sadly he appears to have disengaged.

It sounds like people literally stole this money. I’m all for laying hate where it is due, I don’t think this is an example.

You forgot to mention that working population will also have to pay back their mortgages 10 times the average income. Hello from Auckland :)

I'm sympathetic to what you're saying, but I think it's painting with a broad brush. I think of my in-laws who have lived essentially their entire lives in a small town in Alabama. A teacher and a Vietnam Vet / worked his entire career at the Army Depot. These people aren't big spenders and their kids are all hardworking productive members of society. My wife is one of the more frugal people I know because that's how she grew up. They do have savings, but a chunk of that was lost when they got in and out of the market at the exact wrong time in the last cycle. Not to mention the fact that their banker had shoved them into a market fund this cycle with stupid fees, but they don't know anything about the market so they didn't know any better. When I talked to my father in law about the pension problems, he was glad that they were on a government pension so they wouldn't have anything to worry about. So now, they're living in a dying small Alabama town, relying on a government pension and their savings which would probably be much higher if they were more financially savvy. It's so easy to look at the extremes and say the whole group got what they deserved, but I'd imagine far more are like my in-laws than those that are living high off the hog expecting the world to take care of them. Fortunately for them, they have 3 kids who are responsible successful young people that when push comes to shove will be there for them, but not everyone is so lucky.

One more thing... and this isn't a direct response to you but one of the other posts, but I wanted the response to be near my other post for context. The post said that these people have benefited from the financialization through their home equity. That's definitely true for parts of the country, but come to small town Alabama and tell me where housing prices are benefiting from low interest rates. Trust me, they're not.

Agree. It would be wise for Gen X, Millennials, Gen Z, and future generations not to rely on Social Security. We talking with my financial adviser I always tell him NOT to include Social Security. If I get some of it great but not planning on it. Should be the same for anyone in a Pension. Need to provide for yourself.

I'm exactly the same way. A prodigious saver opposed to taxes. At the same time, I know we're going to pay one way or the other. Either the economy goes completely to hell with all of these folks living under a bridge, many committing crimes to make ends meet, or we bail them out. What I want more than anything is some serious strings attached to the bailouts to prevent the future moral hazard.

Careful not to conflate the teachers with their union. When I worked for the government, the union policies/positions were usually exactly opposite to mine. Keep in mind that unions can only make more money when they have more members. That means the unions support proponents of big government (typically Democrats but not always). It's the unions that need to be sued for acting in their own best interest versus the best interest of their members. Even a big government guy like FDR of "new deal" fame was opposed to government employee unions. They really need to be legislated out of existence. There should be no public employee unions - period. Even FDR would agree.

lol