There’s a post I found genuinely interesting at Reason.com on the gulf that separates most people’s opinions about public pensions from those held by public workers. I recommend reading the whole thing.
Here in Illinois I believe the issue is moot. Under the state’s constitution the legislature doesn’t have the power to correct a problem that’s completely out of control. As I see it there are only two, equally politically impossible solutions: amend the state’s constitution or stagger along until the state takes the unprecedented step of declaring bankruptcy.
At the very least, they should put new hires into 401ks. That aside, assuming they go into bankruptcy. Where would pension holders rank amongst the creditors?
Steve
PD or Dave will correct me if I’m wrong, but I believe it has been determined that unlike a private corporation their claims are top of the heap and not with the unsecureds. If there are other equivalent claims I don’t know if they would be pro rata recipients.