New Jersey is on the cusp of a public pension crisis that could dwarf the $3.5 billion to $4 billion funding shortfall projected by Gov. Jon Corzine in October. Although the figures are obscured by current accounting rules, a detailed examination shows that New Jersey actually faces a potential $80 billion pension shortfall (not even counting the more than $20 billion in losses from the current stock market free-fall) and $50 billion in unfunded post-retirement medical and prescription drug benefits.
This total unfunded liability of $130 billion is more than four times the state's 2008 fiscal year budget, and represents a shortfall of around $44,000 for every household in the state. It's fair to conclude that sooner or later, someone -- almost certainly the taxpayer -- will be forced to shoulder this staggering fiscal burden.
Tuesday, August 4, 2009
In The Hole
Following up on today's earlier post, I found this post on NJ's underfunded pensions from Harvard University's Kennedy School of Government lecturer and former assistant secretary in the U.S. Treasury Department Thomas J. Healey interesting:
Posted by Jack at 2:31 PM