Broken Promises: Pensions All Over America

ilene's picture

Michael Snyder discusses the growing need for pension cuts across the states and cities. Any so-called solutions (like raising taxes) will inflict pain in the other places, while cycling right back to the same place anyway. Another vicious cycle: Of the 10,000 baby boomers headed for retirement - how many won't be able to? How's this going to effect the lack of jobs for younger people? A stock market crash would be disastrous, so the "printing money" method (with consequent devaluation of savings) seems like a way to slow our economic demise, but I can't envision any way out of this. Can you? ~ Ilene 

Broken Promises: Pensions All Over America Are Being Savagely Cut Or Are Vanishing Completely

How would you feel if you worked for a state or local government for 20 or 30 years only to have your pension slashed dramatically or taken away entirely?  Well, this exact scenario is playing out from coast to coast and in the years ahead millions of elderly Americans are going to be affected by broken promises and vanishing pensions. 

In the old days, things were much different. You would get hired by a big company or a government institution and you knew that the retirement benefits that they were promising you would be there when you retired in a few decades. Unfortunately, we have now arrived at a time when government institutions and big companies have promised far more than they are able to deliver, and "pension reform" has become one of the hot button issues all over the nation. 

Many Americans that have been basing their financial futures on their pensions are waking up one day and finding that their pensions are either gone or have been cut back dramatically.  According to Northwestern University Professor John Rauh, the latest estimate of the total amount of unfunded pension and healthcare obligations for state and local governments across the United States is 4.4 trillion dollars.  America is continually becoming a poorer nation and all of that money is simply not going to magically materialize somehow.  So where is that 4.4 trillion dollars going to come from?  Well, either pension benefits are going to have to be cut a lot more all over America or taxes will need to be raised dramatically.  Either way, we are all going to feel the pain of these broken promises.

There simply is not enough money out there to keep all of the pension commitments that have been made.  Something has got to give.  In the end, millions of elderly Americans will likely be plunged into poverty as pensions disappear.

Some local governments around the nation are already declaring bankruptcy and are either eliminating pensions or are cutting them very deeply.  Just check out what just happened in Central Falls, Rhode Island....

For years, city officials promised robust union contracts and pensions without raising revenue to pay for them. Last August, the math caught up with them. Central Falls was broke, its pension fund short $46 million. It declared bankruptcy.


"My daughters grew up here, went to school here. It's all gone," said Mike Geoffroy, a retired firefighter.


He said he could not make the payments on his house after his pension was cut by $1,100 a month.

When will the math catch up with the city where you are living?

For years and years most of our state and local politicians have been ignoring this problem.  But eventually a day comes when you simply cannot ignore it any longer.

Check out what Pensacola Mayor Ashton Hayward said about the situation in his city recently....

"When our annual pension liability is more than our yearly property tax revenues, we have to do something"

Keep in mind that taxpayers don't get any new services for money spent on pensions.  It is money that goes straight into the pockets of retired workers.  State and local governments are desperately trying to pay retired workers what they are owed and fund ongoing government functions at the same time, but many have reached the breaking point.

All over the country, state and local governments are going broke.  The following is from a recent article by Duff McDonald....

Alabama's Jefferson County has actually gone bankrupt. Stockton, California is all but ready to do the same. And all you have to do is look to Detroit—or any of the nearby auto towns named after a Buick model of one sort or another—and you see fiscal crisis playing out right now. Look in your own backyard—or at the potholes on your neighborhood roads—and you will likely find the same.

Things are so bad in Stockton, California that they are actually skipping debt payments....

The city of 290,000 that rode the wave of the housing boom in the late 1990s and early 2000s now finds itself littered with foreclosed homes, saddled with pension, health care and other obligations it can't afford, and unable to pay its bills.

The City Council voted last month to suspend $2 million in bond payments and begin negotiations with bond holders, creditors and unions.

And did you notice what is being blamed for the financial problems in Stockton?

Pension and healthcare benefits.

Sadly, we are seeing pension nightmares erupt all over the nation right now.

For example, check out what is happening to the Public School Employees' Retirement System and State Employees' Retirement System in Pennsylvania....

PSERS had an accrued unfunded liability of nearly $26.5 billion, the amount of money the fund is short to cover existing retirement benefits. That hole is expected to grow to $43 billion by 2019. SERS is $12.5 billion in the red, and that shortfall is expected to climb to nearly $18 billion by 2018. Unless the stock market makes giant sustained gains, taxpayers will have to refill those funds.

That doesn't sound good at all.

In California, the Orange County Employees Retirement System is estimated to have a 10 billion dollar unfunded pension liability.

How in the world can a single county be facing a 10 billion dollar hole?

This is madness.

The state of Illinois is facing an unfunded pension liability of more than 77 billion dollars.  Considering the fact that the state of Illinois is flat broke and on the verge of default, it is inevitable that a lot of those pension obligations will never be paid.

In fact, there are going to be a whole lot of broken promises all over the country.

Pension consultant Girard Miller told California's Little Hoover Commission that state and local government bodies in the state of California have $325 billionin combined unfunded pension liabilities.

That comes to about $22,000 for every single working adult in the state of California.

So where is all of that money going to come from?

But at least most state and local government employees are still covered by pension plans, even if they are failing.

In the private sector, pension plans are vanishing at lightning speed.

According to the Boston College Center for Retirement Research, the percentage of workers in America covered by a traditional pension plan fell from 62 percent in 1983 to 17 percent in 2007.

That isn't just a trend.

That is a tidal wave.

And many of the private pension plans that still exist are massively underfunded.  For example, Verizon's pension plan is underfunded by 3.4 billion dollars.

So what should Americans do in light of all this?

Well, the number one thing to realize is that the pension plan you have been counting on could disappear at any time.

We live in an economic environment that is extremely unstable, and about the only thing you can count on in this environment is rapid and dramatic change.

Do not plan your financial future around a pension plan.  If you do, you are likely to be bitterly disappointed.

Americans that plan to retire in the coming years should do their best to try to fund their own retirements.

Unfortunately, most Americans are not putting away much of anything for retirement.  As I have written about previously, one study found that American workers are $6.6 trillion short of what they need to retire comfortably.


Over the next 20 years approximately 10,000 Baby Boomers will be retiring every single day.

A lot of them are going to be blindsided by empty pension funds and broken promises.

We are facing a retirement crisis of unprecedented magnitude, and there is not much hope in sight.

And if there is a major stock market crash, things are going to be much, much worse.

Most pension funds and retirement plans are heavily invested in the stock market.  If we were to see a major financial crisis like we saw back in 2008 it would be absolutely devastating.  Millions of Americans could see their retirement plans wiped out in short order.

Once again, please do not place your faith in the system.

If you do, you are likely to end up holding a bag of broken promises.

A gigantic tsunami of unfunded pension obligations is coming.  A lot of state and local governments are going to go broke. A lot of promises are going to be broken.

If you hope to retire any time soon, you better plan on being able to take care of yourself.


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johnjb32's picture

From 2004 on I was warning that pension funds were already being looted. It's clear that the process has accelerated. Anyone counting on a pension now should be lumped with those waiting for the Tooth Fairy, or abiotic oil, or free energy from aliens who will be here any minute now. -- Michael C. Ruppert

windcatcher's picture

Such poetic justice, the government drones (as in bee drones) who supported NAFTA, globalization and New World Order; the BLM and Forest Service bastards that ruined our forest and kissed corporate butt; the sworn oath members to the Constitution who aided and abated the Treason to the sovereignty of the USA: They all deserve to starve for their complicity in the destruction of America. Now, maybe they will realize that the globalization plan included the end of the government precipitators as well.

Quaderratic Probing's picture

7 trillion for BANKERS 0 trillion for Grandpa

G-R-U-N-T's picture

Just a reminder...

State's pension liability tops $500 billion, Stanford study finds

California will become Jefferson County soon...



squexx's picture

Debt is unsustainable from the top down. The US Government will default, just like state and local governments will.


Gold and silver, DAMMIT!

The They's picture

Making unkeepable promises seems to be an american tradition at this point.

Seer's picture

Been going on since the beginning, just ask the original American natives.

Perpetual growth on a finite planet, whether managed under "capitalism" or "socialism," IS a Ponzi.  We mustn't fool ourselves.

Omen IV's picture

they have plans to murder by neglect 160,000,000 over the next 50 years -

this is cumulative objective based upon higher Medicare premiums, deductability, qualification restrictions, lower SS benefits, stop SS at 55 years old, limit pensions - higher utilities  -----  people will drop out and not be able to afford to sustain their health so they will die faster

johnnynaps's picture

And, people are too stupid to be proactive about anything. Because working 60 hours a week and living on mcdonalds to have the latest cancer causing icrap does wonders for one's health and premiums!

SmittyinLA's picture

actually CA's liabilities are far worse, well over 500B-before the 08 collapse and before CA enhanced the pensions of thousands of CA workers-which they did even knowing pensions were underfunded by hundreds of billions of dollars.

and what's worse is what assets CA is holding, no doubt its chok full of MBS toilet paper.

nmewn's picture

Ummm, who get's pensions anymore? Cry me a river.

Papasmurf's picture

No difference between pension and savings.  Both are disappearing. 

sun tzu's picture

Math is mean and heartless

nmewn's picture

Yes it is.

I see ObamaCare will wind up costing twice as much as advertised...who didn't see this one coming...

Today, the CBO released new projections from 2013 extending through 2022, and the results are as critics expected: the ten-year cost of the law’s core provisions to expand health insurance coverage has now ballooned to $1.76 trillion. That’s because we now have estimates for Obamacare’s first nine years of full implementation, rather than the mere six when it was signed into law. Only next year will we get a true ten-year cost estimate, if the law isn’t overturned by the Supreme Court or repealed by then. Given that in 2022, the last year available, the gross cost of the coverage expansions are $265 billion, we’re likely looking at about $2 trillion over the first decade, or more than double what Obama advertised.”

Continue reading on Obamacare costs twice as much as Democrats claimed; Stimulus drives up debt - Washington DC SCOTUS |

cranky-old-geezer's picture



Much of the problem can be solved by terminating city governments and turning those fuctions over to county governments.  

City governments simply aren't needed.  Shut 'em all down, terminate those city pension plans, city retirees can live on the street, nobody cares, they're hated anyway, worthless leeches on taxpayers.

PulpCutter's picture

City governments simply aren't needed.  Shut 'em all down..."

Absolutely.  Check out Somalia.  NO government there - and it's a paradise!

Central Bankster's picture

Typical strawman argument from a fascist.

CH1's picture

Right... and our magical, holy city governments keep us all from being monsters?

Have you ever met the people who work in city governments?

sun tzu's picture

While I agree that most city governments are 80% bloated, I don't think you can dissolve those entire governments without dissolving the cities themselves. Tons of city positions are nothing more than employment programs and revenue generators. 

cranky-old-geezer's picture



When you dissolve a city government you dissolve everything associated with it, city limits, city ordinances, city zoning, city taxes, all of it.  The city no longer exists.

The area goes back to being an unincorporated town, what it was before the city government was chartered by the state.

Any services provided by the former city government are taken over by the county government or simply elimininated. 

For example there are no more city police.  That function is taken over by the county sheriff and deputies.

JimS's picture

Geezer: I think they did a movie about that a number of years ago, I believe it was called Mad Max.

Lester's picture

Bruce Williams and all the pop media shills convinced the boomers and middle-class that they could better manage their money with 401k and profit sharing versus relying on a defined benefit or defined contribution pension plan.  Congress, SEC and other regulators could've taken action against the Frank Lorenzos and other corporate raiders that took over corporations with pension funding in excess of liability.

Understand that ERISA opened the door to the raiders as much as it put onus of testing compliance on plan sponsors. As we saw with Arthur Andersen, opinions were for sale and all that mattered was having the attest of an enrolled actuary to certify "testing" and fudge the leeway either way, depending upon who was paying them.

The looting has gone on for more than 30yrs.  Law always structured to enable theft and diminishment of stockholder position, equity and longterm viability.  Written by attorneys for attorneys...

Promises To Pay.  None worth a tinker's damn.

The best conceivable benefit plans always went to Congress and Federal Employees.  Guy earning $10m in qualified compensation can't get the deal Congress wrote for itself.  To be sure, all their liabilities remain unfunded. (See Laurence Kotlikoff's 8/09 WSJ article detailing the $207 Trillion actual Federal Unfunded Liability & Debt level).  Those fucks know where to get the money and how to take it from you (hint: at gunpoint!)...

The trillions from public coffers continue to go somewhere.
To be sure, they're just being looted and US Citizens derive no benefit from them.

The Big O and his cabinet minions are boldly espousing to The Citizenry that they have the right to do anything, by any rationalization necessary; even committing murder.  Really think your pension is ever going to be paid? 

Just wait till TPTB have O declare Martial Law and watch life insurance proceeds be removed due to the "act of war" clause that will be found to prevail.

William Cooper used to say the honest folk were just "steaks on the table" to these scumbags.  Looks to me like the time of the big, sit-down dinner has come to visit US all...

sun tzu's picture

I would rather have a 401K than a pension. How many pensions do you think will be paid out over the next few decades? At least if I fuck up my 401k, I did it to myself. With the pension, I know that somebody is fucking me up the ass

Papasmurf's picture

Who's holding your 401K for you?   Corzine Capital Managment?'s picture

You think the gov't won't hesitate to "nationalize" your 401(k) when they begin to run out of other options? 

One option they may exercise would be to require you to use the balance in your 401(k) to purchase treasury bonds.

Or, if things get really bad, they may seize it and call it a "progressive" tax so they can continue to doll out money to the perenially unemployed or baby boomers who are counting on Social Security to fund their retirement (but haven't saved a penny of their own). 

Keep your $$ out of 401(k)s and out of IRAs - cold, hard cash stuffed in a jar and buried in a backyard might suffice, but gold coins and guns would be a better bet.

Winston Churchill's picture

They already passed legislation to do just that.

It was tucked into the stimulus bill,which nobody in Congress bothered to read.

blunderdog's picture

This claim can't be verified.  There's a very obscure and sidelong reference to 401K legislation in the stimulus bill, but nothing that suggests what you just implied.

Winston Churchill's picture

According to a site I went to.

The wording gave the Treasury the power to tax 401k funds at a rate to be determined by the Treasury.

If that site was wrong,I stand corrected,but I would prefer to see your source data myself if we disagree,so I can

make my own decision.


blunderdog's picture

I can't produce a quote that doesn't exist.  I've tried to track down all the sources of this claim since I first started seeing it in '09.  It would make sense if it were the 2009 stimulus act that you're referring to.

All the changes to policy on 401K plans are right in there.  Just point out what you're talking about, or find the guy who did for you.

(EDIT: To be clear, my issue is with the stronger claim, that there've been plans/mention about confiscation of 401k, not that they can choose a rate to tax your withdrawals from it.  They've already done that part, I think.)

nmewn's picture

From my gal Theresa, just to give you an idea of how she thinks...

"But the nudges are expensive. Before proposing a $50 Billion saver’s tax credit, the Obama administration should analyze whether the nearly $170 billion in tax subsidies for 401(k), IRA and other retirement accounts are as effective as they could be in promoting savings."

I believe what she's talking about here is deferment of taxation, not a tax credit or subsidy as she implies. It is taxed at withdrawl, not when it's earned. It comes out of gross earnings before taxes.

 I can't find where she testified on converting 401k's/IRA's to government sponsored annuities but I know she or someone up in DC did. Many of these things disappear down the internet memory hole...but I do remember the uproar over it.

 Just coming back around because you seemed interested in the topic.



blunderdog's picture

Thx, but that's nothing.  What that quote means is that she's thinking that government subsidization of saving may not require 2 separate and competing sets of legislation.

401K is a CURRENT mechanism by which the Feds subsidize "saving"/investment for much of the public.  A "saver's tax credit" is a PROPOSED mechanism (although it's not really a bill yet--it's just noise) for the Feds to subsidize saving.

There's one tiny aspect of the subject that interests me. 

It has been oft-repeated over at least the past 3 years that: there is text in the stimulus bill that sets up framework by which the Feds may (or will) become able to confiscate your current 401K holdings.

I have traced about 40 of these claims back to the original sources (as best possible on the Internet, I ain't got time to sit in a library and I can't afford lexis-nexis), and in every case, it was a throwaway comment attributed to a non-authoritative source that such text exists. My bar for "authoritative" on this source is pretty high--it would have to be either the text in the bill itself, or one of the committee-members who helped draft the bill and then voted for it.

I do not believe the claim to be technically accurate--I think someone either misheard, misread, or otherwise misinterpreted something, but it was broadcast widely enough to have become a very prevalent comment.  NO ONE knows the source, or can point to the text of the legislation they're referring to.

It's just a hobby interest.  Some folks might wonder where the first Bigfoot sighting was--I wonder where the first publication of that meme was.  Like etymology or sitcoms or sports statistics, it's probably a useless thing to care about.

Maybe one day someone will quote me the text of the law that does this, and I'll be able to die happily corrected.

nmewn's picture

"I have traced about 40 of these claims back to the original sources (as best possible on the Internet, I ain't got time to sit in a library and I can't afford lexis-nexis), and in every case, it was a throwaway comment attributed to a non-authoritative source that such text exists. My bar for "authoritative" on this source is pretty high--it would have to be either the text in the bill itself, or one of the committee-members who helped draft the bill and then voted for it."

Well, that's a pretty damned high bar seeing as how it hasn't Like I said, they're eyeballin it...and "my gal" Teresa is right in the middle of it.

"But the Chairman has also signalled greater ambitions. At a hearing last month, Mr. Miller put the 401(k) system into play. Under the current system, employers match employee contributions that aren't taxed until redeemed, an indirect subsidy worth some $80 billion today. "We have to start to think about in Congress . . . whether or not we want to continue to invest that $80 billion for a policy that's not generating what we now say it should," Mr. Miller said. "For a taxpayer investment of this size, we must ensure that the structure of 401(k)s adequately protects the nest eggs of participating workers."

His committee listened to possible reform proposals. Most eye-catching was an idea from Teresa Ghilarducci at New York's New School for Social Research. Her plan would end the tax breaks for 401(k)s; she proposes instead to give all workers an annual $600 inflation-adjusted tax credit for retirement and force them to invest 5% of their pay into a government-run retirement account managed by the Social Security Administration. She called the 401(k) "a failed experiment." A McDermott spokesman called her proposals "intriguing" and "part of the discussion." Mr. Miller hasn't so far endorsed the plan.

The main liberal objection to 401(k)s seems to be that they let average Americans control their own investment decisions for retirement. As Shlomo Benartzi, a professor at UCLA's Anderson business school, told Mr. Miller's committee, "Individuals have a tendency to buy at the peak, and then panic when the markets drop and sell at the bottom." Better to have the government do this instead."

Your tolerance bar appears pretty high...mine is very low.

This is sort of thing is exactly why no one trusts the "system" and have stashed/hidden untold amounts away from they should.

It's their saved earnings, not governments...and definitely not some chick from New School who shares the same office building with Soros.

blunderdog's picture

I have no idea what you're trying to communicate.  This is a very simple issue--either the stuff is in the bill or it's not.

You're throwing out a lot of related bullshit, but again, it has nothing to do with the question as to whether the stimulus bill contains such provisions or not.

I guess you didn't understand my previous post.

nmewn's picture

Well, I guess I didn't understand your previous post ;-)

"(EDIT: To be clear, my issue is with the stronger claim, that there've been plans/mention about confiscation of 401k, not that they can choose a rate to tax your withdrawals from it."

Me now...nmewn...Ex-Chairman Miller of the House Education and Labor Committee had Teresa Ghilarducci from New York's New School for Social Research in front of his committiee doing more than just "mentioning" it. It was a presentation of her views which is batshit crazy.

They/she were talking about abandoning and/or confiscating private 401k accounts in favor of running a defined benefit system simliar to SSI which is, as you know, completely bankrupt itself.

A ponzi must have "fresh" money in order to continue or it collapses.

Now I'm not trying to start a shit storm with you here BD...but if you refuse to acknowledge Teresa Ghilarducci's appearence (and her background) in front of a Congressional Committee stating that 401k's are "a failed experiment"  there's not much more to say.

Even while, yet another congresscritters spokesman, who presides over yet another subcommittiee (of the House Ways and Means Committie), calling her proposals "intriguing" and "part of the discussion" would certainly stands up to your measure of editing clarity...I would hope.

I have grown to respect your opinions (even though I sometimes disagree with them) so I would hope you would afford me the same. You can run from one semantic theme to the next (from proof of mentioning "in the bill") all you want...I said eyeballin...and that is exactly what I just laid out for you. 

I'm not much on the parental tone you're taking with me here BD.

If you want to believe they are not "eyeballin" (my word) every pool of funds beyond their control you can. Just don't expect others to do likewise and don't expect any sympathy after putting your faith (and money) in proven scoundrels.

blunderdog's picture

Don't get riled, I just don't care what Theresa says.  It doesn't bear on the issue, nor my statement that Winston's claim above can't be verified.

Are there politicians "thinking about" confiscating 401Ks?  Probably, sure.  We agree completely on that.

Who cares?

I see the cause of your confusion, by the way.  That sentence from my reply to Winston Churchill was intended in-context to refer to the text of the bill.  Taken out of context, ie: ignoring the bill, sure it sounds like I might care what the politicians say.

Are we clear now?

nmewn's picture

Well I think that is the issue.

We have a "group" of pols that pretend to care, who have convinced more than a few people they do, when they really don't. Afterall theirs is guaranteed if they can continue to kick the can.

The only ones who really care are the ones who watch for this sort of theft. The ones who did save, who weigh the real risks of owning common stocks, the ones who only move in when a severe selloff has occured and then leave again.

Because they know what it is.

"Don't get riled, I just don't care what Theresa says."

My opinion is you should. You should also care that Commiittie Chairmen are even giving her the time of day. Some "options" are still non-negotiable.

It's ours, not theirs to fiddle around with.

blunderdog's picture

I've just given up on Federal government completely as an institution.  I'm pretty certain it will *never* do anything right again.  That's why I'm an anarchist--my goal (and suggestion) is to live as far as possible from Federal activity.

If you own a 401K, you're playing the Feds' game--it's a tax break.  Any time the government offers you something like a tax break, you can be damn sure there's a cost that they're not telling you.  Most of the time they're not telling you because it doesn't exist YET, but it's still a cost.

Caviat emptor.  Render to Caesar those things that are Caesar's.

nmewn's picture


Well, it is Caeser's Coliseum in a monetary sense, of course.

While we can agree Caesar laid claim to many things, still many things were well beyond Caesar's grasp and were destined to always be so. Just as they are now. He knew this more than anyone.

The petty players who claim that authority now will learn the same thing.

nmewn's picture

It's not like they ain't eyeballin it BD...

"The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams, according to Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry, who are spearheading the effort."

Google up Theresa Guilarducci.

Winston Churchill's picture

Carbon copy of the UK system coming.

You're made to take 50% as a compulsory purchase annuity.

When I vested mine the compulsry annuity only got me half the income of an open market one. of your money to the banks and insurance lobby.

cranky-old-geezer's picture



Yep, just like I've been saying, they're gonna confiscate  all the 401ks, IRAs, pension funds, etc.  

It's the next logical step in Wall Street's national looting spree, grab sheeple's retirement assets and replace them with (worthless) IOUs, just like the government did with social security trust fund assets.

Wall Street needs more assets to hypothecate (and re-hypothecate over and over again) so they can keep their casino ponzi scheme going a while longer.  

There's a few trillion dollars worth of retirement account assets sitting right there under their nose.   They can't resist the temptation much longer.

So go ahead, leave that 401k alone, trust the government. 

I love watching stupid sheeple get sheared.  I'll laugh my ass off when they take it away from you.

Winston Churchill's picture

They already looted it once with the ' AAA'  RMBS schemes and walked free.

Second times a charm !

847328_3527's picture

I agree with you ilene, The most common "way out" historically is devalue the debt payments just as we did post-WWII at the rate of 8%-12% per year so our nation's debt was paid off with cheaper dollars.

CPL's picture

Tsunami Warning for Japan as of 5:58 EST

Cathartes Aura's picture

Japan & New Zealand are certainly having active flashbacks over the last 24 hours. . .

jimmyjames's picture

So where is that 4.4 trillion dollars going to come from?  Well, either pension benefits are going to have to be cut a lot more all over America or taxes will need to be raised dramatically.  Either way, we are all going to feel the pain of these broken promises.

but I can't envision any way out of this. Can you?


Maybe we should try something that hasn't been tried and in fact it has been countered by every means available-

Let the market work-let deflation/default happen-

If prices were allowed to fall-less money would be needed and that money would have buying power-

There will be pain-there has to be-but cutting pension benefits and low prices would be much easier to tolerate than no pension and high prices-

If the cost of living fell by 2/3--pensions could be cut by 2/3 and likely taxes would not have to increase-

Of course it will never be allowed politically-but the market would sort this mess out quickly and sure-there would be bodies floating but sometimes bodies need to float-

Seer's picture

"Let the market work-let deflation/default happen-"

When can I stop laughing?

The "Market" is CONTROLLED by the big banks!  It is doing EXACTLY what it wants to do.

If you're talking about some mythological honest market, well... about as likely as JC returning.

Besides, it's still an issue of The System, not how it's run.  Perpetual growth on a finite planet is NOT a working model.  As long as growth is a target we're going to have a Ponzi.

jimmyjames's picture

The "Market" is CONTROLLED by the big banks!


Oh really? Tell us all about it--

I might have been born at night--but it wasn't last night-

sgt_doom's picture

Outstanding blog posting, Madam Ilene, but have you read Ellen Schultz's Retirement Heist ???

Truly an outstanding fountain of information she and her team did on that!