New Facts About The State Pension Funds

Morningstar recently did a review of the US State Pension Funds for their investors (here and in the video above). The review found that the Wisconsin Retirement System (WRS) was the strongest fund in the country with a funding ratio of 99.8%. This means that Wisconsin's unfunded liability per resident is $23, the lowest of any public pension fund in the US. The results beg a lot of questions: How is Wisconsin able to have a solvent Public Pension Plan? Why can't the other States?

Before answering these questions, there is a simple takeaway from these findings: States can afford to offer solvent Pension Funds for their employees. What is more, States could offer solvent Pension Plans to all their citizens. And, corporations could also offer solvent Pension Plans to their employees. The Right Wing simply does not want to provide pensions (the same Debt Alarmists that would think $23 is too large an unfunded liability) and any other form of social security to workers.

Watch Henry Ford Preview on PBS. See more from American Experience.

If you want some insight into why the Right Wing opposes solvent Pension Plans (Public or Private) watch the PBS American Experience documentary on Henry Ford (here). Ford is one of the Titans of Industry and had opinions befitting his class: anti-union, anti-worker, anti-Semetic, etc. The Ford River Rouge Complex was run like a police state, a model for Right-Wing US industry. The Ford Pension Plan was the result of UAW labor disputes and bargaining, not enlightened, financially adept management.

Why are the State Pension Plans in trouble? Two reasons: The Subprime Mortgage Crisis and years of underfunding or outright stealing from Pension Plans by politicians. The goal of all this is to wake up one day during a financial crisis and claim that the State can no longer pay its pensions even as the real reason is years of deliberate fund weakening. Why is Wisconsin able to provide its employees a solvent Public Pension Plan? By law, politicians cannot touch the WRS. It's that simple. One more thing, it's not because the Public Sector cannot afford to provide pensions. Wisconsin currently has a $484 million surplus (here) none of which is needed to provide continued Pension Plan support.