No American Will Be Spared From Impending Public Pension Bailouts

by | May 13, 2020 | Retirement

After the 2008 financial crisis, huge companies like AIG asked for billions in public pension bailouts, claiming they would close up shop if they didn’t get the funds. The truth of the matter is that they had screwed up and wanted U.S. taxpayers to foot the bill. This situation left a bad taste in the mouths of most Americans.

Fast forward to today’s chaotic COVID-19 market, and it looks like history may be repeating itself. This time, the U.S. is on the verge of bailing out airlines. And soon to follow could be public pension funds. An article in the Wall Street Journal shed light on the first U.S. state to request bailout funds:

Illinois has requested a federal bailout of its struggling public-employee retirement plans, which had unfunded liabilities topping $469 billion in 2018, according to a Federal Reserve study.

Specifically, according to Chicago’s Daily Herald, Illinois Senate President Dan Harmon requested $44 billion in bailout cash.

The problems in the state’s public pension fund are well known, and the fact that Harmon requested emergency funds should only serve to make those problems more obvious.

The Daily Herald lamented, “Despite pumping more and more into the pension systems each year, Illinois continues to slide deeper into debt.” And, the article goes on, Illinois may not be able to get financial help from the private sector any longer:

Excessive debt driven by the pension crisis has left Illinois with the lowest credit rating in the nation, just one notch above junk status. That means private investors may not be willing to lend Illinois money much longer.

It would seem that asking taxpayers who are already concerned with their own situation for more money would be a bad idea. But that’s what Illinois is doing.

Worse, Illinois isn’t the only state with big pension problems. In fact, quite a few others could soon be seeking bailouts. Consider the map from the American Legislative Exchange Council, which ranks state pension funding from worst (50) to best (1).

Each of the lowest ranking state pensions (in darker shades of blue) could be a candidate for a bailout at some time in the near future.

And regardless of whether strings are attached to this funding, Forbes says bailing out pension funds isn’t a good idea:

The pension crisis has been the result of a long line of politicians refusing to take responsibility for pension funding. A set of mandates from the federal government will motivate Illinois politicians, to be sure — they will become all the more innovative at finding loopholes and seeking waivers, rather than taking responsibility.

But perhaps even more important is the fact that bailing out state pension funds during this crisis could affect everyone.

Pension or Not, Here’s How No American Will Be Spared

If state governments start getting bailed out, the first and most obvious way you would be affected is through increased taxes.

But even if states don’t get a bailout, they aren’t likely to just let their pensions wither and die. So, they could start looking for ways to cut back on services.

One example, according to a different Forbes piece, shows that states may begin prioritizing failing pensions over infrastructure:

Berkeley city council is taking criticism for prioritizing pension payments ahead of public works projects. Voters approved bond issues supposedly dedicated to infrastructure but the city is apparently not doing the work.

States could even cut emergency services like police, fire, and medical response.

Protect Yourself While Politicians Beg for Pension Bailouts

Even though you may not have a say when the pension crisis might strike your wallet, you can still make your retirement portfolio more resilient.

You can consider adding some stability to your portfolio by shifting a percentage of assets into precious metals like gold and silver.

But whatever you do, don’t wait. The ripple effects of public pension failures aren’t going to wait for anyone.

Consider Opening a Gold IRA

One strategy for protecting your wealth is diversifying your portfolio with a Gold IRA. Oakhurst Metals specializes in Gold IRAs and can help you convert your traditional or Roth IRA or 401(k) into a Self-Directed IRA, capable of investing in IRA eligible precious metals. To get started, give us a call at (888) 260-4749 or fill out your information here.

This article originally seen on Newsmax.

3 Ways To Survive Devastating Dollar Collapse

The U.S. economy is unstable, as is the future. Learn how to protect your wealth from the dollar collapse and discover viable ways to grow your wealth as well. Introduction The period of the U.S. greenback’s “exorbitant privilege” because the world’s major reserve...

New Jersey Local News, Breaking News, Sports & Weather

Get the latest New Jersey Local News, Sports News & US breaking News. View daily NJ weather updates, watch videos and photos, join the discussion in forums. Find more news articles and stories online at

Buy The Dip In Silver

View Original Article Consider a Gold IRA One strategy for protecting your wealth is diversifying your portfolio with a Gold IRA. Oakhurst Metals specializes in Gold IRAs and can help you convert your traditional or Roth IRA or 401(k) into a Self-Directed IRA, capable...

Gold And Silver Are Getting Ready To Explode

Volatility in gold is increasing as we deal with trying to resolve the political, health and economic crises.

Fed’s Esther George cautions that inflation could rise faster than expected

Long-dormant inflation could rebound more quickly than anticipated, Kansas City Fed President Esther George said Tuesday.

Warren Buffett’s favorite market indicator hits 13-year high, signaling global stocks are most overvalued since the financial crisis

The global version of the ‘Buffett Indicator’ has surged past 120%, its highest reading since October 2007.

Communists Come Out in American Media

RUSH: Now, I want you to remember, CNN, for whatever else they are, they are a media outlet. Now, obviously they’re Democrat hacks.

China Could Force Donald Trump And The Fed To Destroy The U.S. Banking System

The Federal Reserve has warned central bank digital currencies might one day replace commercial banks, creating “a deposit monopolist” and playing “havoc” with the system…

Will the FED destroy the dollar?

Just thinking about that question should put dread in your heart. Shouldn’t the goal of the Central Bank of a country protect the currency of that cou

Gold prices log gain to start week, even as dollar stages mini rebound

Gold prices settle modestly higher Monday, as investors opportunistically buy gold after a withering downturn Friday. The solid gain for bullion comes…

Opinion | Welcome to the Era of Nonstop Stimulus

Spending didn’t speed the last recovery, but Biden’s team is keen to keep the money flowing endlessly.

Election Year

Live Gold Price

Live Silver Price

Skip to content