Are Collapsing Pensions "About To Bring Hell To America"?

Tyler Durden's picture

Authored by Mac Slavo via,

The toxic dollar is bringing hell in a handbasket.

Along with the student loan debt bubble and other major financial factors, the looming pensions crisis is bound to be the death of us all.

Because it’s based on a future promise to pay, it has long been a benefit dangled to solve strikes and union disputes – because, in the end, it is just more debt, whether private or public.

With tens of trillions in unfunded liabilities, the weight of an avalanche remains dangling over our heads. An aging population is cashing in on needed retirement benefits while the younger generations must support multiples that are unsustainable financially.

Somewhere between the retiree that needs clothing, food and lodging, and the bankruptcy of cities and state governments is the makings of the next economic crisis.


This is one of those things that few will pay attention to until it’s a 5 alarm fire. Then the policymakers will run around with their hands in the air saying they didn’t see it coming.


Of course they did. But addressing the problem is hard and will make people unhappy in the short term.

This blog pointed out the sad, and quiet fact that entities like the government of South Carolina are deep in debt over pensions. Everywhere there are failing social systems.

And somewhere, the rubber is going to met the road, and people are going to get hurt.

As SHTF previously reported:

In 2014 a new Federal law made it possible for pension funds to cut benefits for their recipients.


[I]n October of [2015] the canary in the coal mine fell over and died when Illinois announced that the State was posting pension payments because it ran out of money.


Fast forward a few more months and things have been taken to the next level. The Central State pension fund in Kansas became the first such fund to take advantage of the 2014 law as 400,000 Americans who depend on their monthly pension income to pay for such things as their mortgage, groceries and medical expenses saw an average of $1,400 per month sliced of their monthly benefits.

Unfortunately, there may be no avoiding some very painful lapses in checks in the difficult years ahead.

As Market Watch reports:

But take a look South Carolina’s government pension plan, which covers roughly 550,000 people — one out of nine state residents — but is a staggering $24.1 billion in the red.


This is not a distant concern, but a system already in crisis.


Younger workers are being asked to do much more to support the pensions of retirees. An analysis by the The Post and Courier of Charleston noted recently that “Government workers and their employers have seen five hikes in their pension plan contributions since 2012, and there’s no end in sight.” (Most now contribute 8.66% of their pay, vs. 6.5% before the changes.) At the same time, the pension fund has been chasing more stocks and alternative investments instead of relying on stable investments like bonds that may be much less volatile but generate only meager returns.


And if that’s not troubling enough, South Carolina’s pension fund is far from alone.


California’s Calpers public retriree system is notoriously underfunded and doomed to implode. Chicago, Detroit and other urban wastelands are sagging under abysmal debt. Dallas, Texas pensions went insolvent. Puerto Rico is nothing but a propped up holding corp(se).

Something massive has been swept up just under the carpet.

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crossroaddemon's picture

A  revolution that won't be forthcoming. You can't organize without being found out anymore, and whoever fires the first shot will be made a bloody example of. And face it, a population that can't survive a week without JIT grocery store delivery is in no position to revolt.

just the tip's picture

let's ask LaVoy Finicum his opinion of your comment. 

oh, wait ..............

skinwalker's picture

I think you're forgetting something.

A desperate man with nothing left to lose doesn't care if he's made an example of. He just wants to spill blood. All the threats in the world can't stop him.

When their kids are starving and they are still forced to pay outrageous taxes, many men may decide that a blaze of glory is preferable.

crossroaddemon's picture

That's why the starving kids won't happen so long as the fed has a printing press. 

northern vigor's picture

When the revolution starts, remind everyone to not use credit cards or cell phones or the government will be able to follow where they are.

But I suppose no one can live like that anymore...Oh well, just  call the revolution off and everyone go home.

just the tip's picture

please remember your cousins north of the red.

northern vigor's picture

I plan to sign a reverse mortgage, and then sign the "I'm 65 and too poor to pay taxes" paper. Then watch the shtf.  I plan on taking the reverse mortgage money and buy silver, then give it to my kids so they can avoid inheritence taxes. I may even burn the place down just before they take me away.

bankbob's picture

My pension plan is death.  I cannot worry about the People who did not see this coming.

Here is the solution: You only get back what you put in.


That would Frost a lot of people's asses.

silverserfer's picture

anyone who drools over the prospects of incurred compound interest( a taste of the ponzi pie) from theire pension  deserves this reckoning. 

just the tip's picture

Here is the solution: You only get back what you put in.

your comment shows a lack of understanding and/or comprehension of the definition of the word "ponzi".

you only get back what others put in.


that is how and why they call it ponzi.  while you were working and putting money in, they were paying out to other current retirees.  it's called a compact between the generations.  you may have paid into an account, but once that account is paid, all the money, check merriam-webster for the definition of the word "all", goes into a common account, think mortgage backed securities, that are now this one big yuge investment, or as we used to say "kitty".  rub is, anyone can in turn draw from the "kitty".  as in, you may pay your share, but anyone can draw from the "kitty".

please refrain from drawing any references between kitty and pussy?   you can't grab either.

leeteam's picture



I know someone who earned $90,000 per year and retired with a $120,000 per year pension with an automatic 5% cost of living increase every year.

Transparent California

 Salaries and Pensions by position or name.

silverserfer's picture

do you know anybody making 7k a month from home part time on the internets? If so do you have a link?

New_Meat's picture

just hang loose  and MDB's bot will wake up with that detail.

just the tip's picture

no one gives a shit about someone you know.

silverserfer's picture

I swear they do these articles just for the rothschild ilk to jerk off to.

silverserfer's picture

.paying extra to your monthly house payment is the same as putting money in a saving account at the interest rate of your mortgage. For me its 3.75% thats not bad at all. 

ToSoft4Truth's picture

Some people contribute to 401K plans while paying 18%+ on credit cards.

ipso_facto's picture

That's because they have a wife.

crossroaddemon's picture

What kind of idiot keeps a wife around?

ToSoft4Truth's picture

"I'm poor."


'Why are you poor?'


"I let a woman spend all my money."

user2011's picture

Make America great depression again!


MagicalUnicornFarts's picture

If you are under 45 years old and have never worked for the govt or a Public service type job, you not only do not have a pension, you probably barely make enough to save for retirement. I could give a crap if these pensions collapse. I pay 33% of my pay to taxes and entitlement payments and Il'll have nothing to show for it when I turn 70. After that I pay another 15% on State and local property taxes in PA. Govt is taking 50% of my income and thats BEFORE I have to pay my fucking Obamacare forced wealth redistribution program for which I derive no benifits.

Our country is fucked. 

Aubiekong's picture

dont forget sales tax and gasoline tax for another 10-30% of your income...

Ruger556's picture

I lived in PA most of my life, it sucks there, the local gov't are like vultures, they will chase you down and you have to prove to them that you were in the right.  After a while I learned that certain cities do not have a local tax, and that is where I lived. I got tired of all the libs taking my money.. I moved to TX where there is no local or state taxes.  Got a raise right then.  

Shift For Brains's picture

Turn 65 and fill out a one-page form and you can quit paying property taxes, too.

HRH Feant's picture
HRH Feant (not verified) Shift For Brains Mar 16, 2017 2:09 PM

As long as you have no or minimal income.

DarthVaderMentor's picture

If you're married, divorce your wife quietly, give her no income but give her the house instead. Then she pays no taxes cause she has no income.

crossroaddemon's picture

Better still to write marriage off as the terrible idea that it is...

withglee's picture

. I pay 33% of my pay to taxes and entitlement payments

Re-run your numbers. The 33% you refer to is really closer to 50%. But you ultimately pay more than 75% of the fruits of your labor to governments.

Directly and slightly indirectly (e.g. fuel and electricity and communications ... and on and on ... taxes), everything you buy has paid the same tax load you do. Say that's 50%. So you pay 50% outright, and then everything you buy (with the remaining 50%) has a 50% tax load on it ... so 0.5 x 0.5 = 0.25 plus the 0.50 you pay direct is 0.75 or 75%.

What "was" your definition of slavery?

Shift For Brains's picture

As someone who is over 65 and benefiting from the present system, I agree with you 1000%. It is wrong. But I am not giving up my goodies until the parasites are squeezed until the blood runs out of their eye sockets. Why should I? You'll never see it.

Come up with something that takes it ALL back from the parasites and is fair and if I have to take a hit, so be it, I'm down for that. Until then, there's no reason for me to go all altruistic for the younger ones. They are the LAST people who would see a dime from my generousity.

agstacks's picture

Yeah, keep sticking it to those young'ns and make them pay for your retriement. I hate boomers. The entitlement never ends.  Sorry you were robbed, but robbing me is not the answer. 

withglee's picture

I totally agree with you. I actively and passively fought the socialization of our companies and country all along the way (for over 50 years).

Companies have no responsibility to provide for people's retirement. Governments have no ability to provide for people's retirement. People should "always" be expected to provide those things they can achieve themselves. They should only resort to collaboration when they can't do things themselves (e.g. obtain right of way and build roads).

I failed with the companies, the governments ... and with fellow citizens. To not do what I can to recover the loot stolen from me is stupid. Doing that in no way concedes my support of these unworkable and unfair processes.

To each according to his abilities and his proof of value in trading ... from each "nothing"! His needs are his own perception and none of the public's business. If someone doesn't make the cut, help them out if you're so inclined (and we are all inclined to help those who will help themselves). But don't contribute to those who claim to help others ... and then take 80% of your contributions in organization and operating costs ... while taking full credit for the good done. It's a racket ... a really really ugly racket.

Iterative secession is the only alternative I see. If after that, my fellow citizens still want that Ponzi scheme, fine. Let them have it in their own space and leave me and mine out of it.

One Ton Lady's picture

and now baby boomers. all of your pension funds will be rescued by the good old uncle sam who will glady redeem your funds with us treasury notes.  isn't that nice?  its all good.  your lovable government has your back. honest.  

ipso_facto's picture

It may be 'under the rug' but it still stinks.

Herdee's picture

Goldman Sachs was behind the looting of Detroit just like settingup a fake structure for Greece. Both were successful for the Goldman Good Ol'Boys Club. Too many others to list but here's a former employee who knows the inside. What are the next big economic set-ups for the biggest world con-artists?

Aubiekong's picture

1. Retire - after taxes and missing out for free shit like health insurance it is really not worth going to work...

2. Buy a paid for cash house in the panhandle of Florida for 30-60K.  Remodel the inside myself (25K) with wood floors, granite counter tops, high end appliances, no permits, inspections, or any other property tax increasing activities thank you.  Chain link the yard around the entire house and have 3-4 large breed attack dogs that are free to roam the outside yard. Go for the poor and you better not fuck with me look.

3.  The only income will be passive rental properties with income below 20K per year  so no federal income tax.  Under the table income is fine and encouraged for any opportunists that come my way...

4. Sign up for every free shit program I can find

5.  Garden, fish, hunt, and cut the cable and internet as life is too short to worry about anything.  TV antenna gets 15 channels anyway and is free...

6.  Drive a new paid for Prius 60-70 miles per gallon carry only liability, replace car with cash every 10 years...

7.  Monthly bills including food for two Less than $1000.00.

crossroaddemon's picture

Your model is not entirely unlike mine, except my house cost less and I don't buy new cars.

Aubiekong's picture

2-3 year old used cars can be a great buy.  I recently bought a new 2016 Prius because I could, in the future I would probably do the used car route...

crossroaddemon's picture

Well, I have to have a truck that can pull a gooseneck so it costs a bit more for me. My truck is about ten years old. My car is actually older, but I managed to find a '90 honda accord with less than 100k miles on it. That fucker has at least 200k left to roll and i got it for a grand...

Aubiekong's picture

Sounds like you have a great plan and more importantly you are living it... Keep it up!

mattfriend88's picture

How is that you can post on ZH if you cut your internet? 


Aubiekong's picture

Its just my shit hit the fan plan and I am tired of this crap and want out, not yet there haven't pulled the plug on closing my business as it still is making money.  In this scenario I would use free wifi at restaurants or the library or truly if I could find decent internet speeds for less than 40 per month might even keep it as a luxury...

crossroaddemon's picture

You can't run a business anymore without the internet. When I moved to town 18 months ago I had to get my teaching business rolling quick quick and I'm guessing the net saved me at least two years worth of hard advertising, and a shitton of cash to boot.

Aubiekong's picture

I would probably keep internet as it is also the way my adult kids communicate...

crossroaddemon's picture

There's that, too. I have two young kids at home that I am largely educating myself, and the internet makes that job about a zillion times easier. It's funny how the kids take the net for granted; you and I are old enough to appreciate what a marvelous thing it is.

Aubiekong's picture

I would probably keep internet as it is also the way my adult kids communicate...

Spungo's picture

I love watching this slow motion car crash. People have been warned for decades that their pensions may not be fully funded, but nobody cares. The people who rely on those pensions seem to care the least, which I think is hilarious.

mary mary's picture

Amazing how many Millenials here have such a deep understanding of finance.  I guess they have owned their own businesses for decades, owned houses and rental property, employed many, been active in local government, spent a lifetime learning the difference between stock investing and stock speculation.  I am amazed and impressed.  They are... gods!