Can California be far behind in wanting a public pension bailout too? Apparently Illinois Governor Pat Quinn thinks the federal government should just go ahead and pony up the $200 billion or so the Illinois public pension system needs to remain solvent.
Moments ago we saw the following amusing headline:
Illinois teachers’ pension fund cuts rate of return to 8% from 8.5%
It’s amusing because these are the same teachers who were demanding, and received, higher pay – 17% higher over four years in fact – following a several day strike.
Public pension funds have special lax rules which allow them to project fanciful rates of return and then pretend to be gobsmacked when the return doesn’t materialize. Private pensions have much stricter rules and can’t pretend they’ll make an 8% return.