Question about the Detroit Pension ruling

[FreeJoe]

I heard on the radio that the judge ruled that they can cut the Detroit pensions under bankruptcy, despite the state's constitution prohibition on just that. The part that isn't clear to me is how this cutting business works. Pensions are pre-funded, at least partially. Are these cuts only looking at any unfunded portion of the pension or are they talking about using money already set aside for pension payments?

[littlewolf]

1. K & R for visability. nt

[pa28]

2. Orr offered around 20 cents on the dollar to pensioners previously.

From everything I've read on the subject it looks like they'll end up with a final figure between 15-20 cents.

Maybe somebody here who knows for sure can add but my understanding is the pension fund does have some cash from a 1.5b bond refinance a few years ago. It appears to me that funds left over would be raided and future benefits would be drastically cut even though the pension system is 90% funded.

Unlike private sector pensions public pensions are not federally insured. Worse still the recipients opted out of Social Security so many of them will be in serious financial peril and all will have skin peeled off to the tune of 80% of future benefits.

[loudsue]

3. To me, this is a fucking OUTRAGE!!! Where are the fucking BAILOUTS for the pension fund???

NOW is where we see how the rich and powerful get bailed out, and retirees who worked their whole life for a stipend get fucked over completely. They don't have any more years to build up a new retirement!!! This is a fucking outrage!!

This does it for me. There has to be some legislation to stop this from ever happening again to one more pensioner. It happened to my aunt in NC when BB&T got bought out/merged. She was like 78 years old, and her pension was CUT IN HALF. Tell me how in the hell anyone can deal with that kind of injustice and not demand some laws be changed.

And here the republicans DEMAND the post office fund their pension plan 75 years in advance. If it's good enough for the post office, it's good enough for all those companies who pay pensions.

Fuck fuck fuck fuck fuck. Goddamn this makes me furious!!!

We have to DEMAND that congress bail out the michigan pensioners. NOW!!

[badtoworse]

4. If it were just Detroit, you might sell the idea of bailing out a public pension fund

There are lots of other cities and at least one state (Illinois) in similar circumstances. Say yes to Detroit and you set a precedent. The feds don't have the money to absorb all the unfunded public pension liability in the country, so I doubt a bailout will happen.

Unfortunately, I see Detroit as the beginning of a huge problem. States and municipalities have made commitments to current and retired employees that they don't have the money to make good on.

[Festivito]

5. Part of the 18B$ debt is for 30? years of upcoming pension payments.

The city can no longer afford to make those payments and pay the people whose butts are seated at desks.

The pension fund used to not allow pension money to go into Detroit bonds. They just kept saying: no, no, no. The city not paying its obligation to the pension fund left the pension fund invested in the city.