Eric Boehm on the Worsening Pension Crisis

Edward Betts

A new assessment of state pension obligations suggests the problem is even worse than it already appears. How much worse? Using a more conservative method of accounting for financial gains in the marketplace, there is a $4.1 trillion gap between assets and liabilities — known as the "unfunded liability" — of all state-level pension systems in the United States, according to State Budget Solutions, a fiscally conservative think tank that deals with tax and spending issues at the state level. On a per-capita basis, writes the Franklin Center's Eric Boehm, each American would have to fork over about $13,100 to fill that gap and fulfill the promises made to current and retired state workers.