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With all the good economic news — stock market highs, record employment and consumer optimism, rising wages, and falling poverty rates — there is on the horizon a dark cloud that could endanger everything.
Multi-employer pension plans have more than $600 billion of unfunded liabilities and are dangerously close to failing. Once these endangered plans fail, others may not be far behind.
State - Governments - Pension - Promises - Failures
State and local governments have about $6 trillion in unfunded pension promises. If these potential failures come to fruition, it could be a disaster far worse than the 2008 housing bust. Before that housing bust, the economy appeared strong and few anticipated an economic meltdown.
But even if one is determined to ignore the trouble signs, any pension plan failure will have a very real human cost and an obvious cost to taxpayers. As pension plans fail, Americans who have worked and been taxpayers their entire adult life will be forced onto welfare rolls — food stamps, welfare payments, housing aid, and disability benefits.
Welfare - Programs - Aftermath - Housing - Bust
We saw welfare programs dramatically grow in the aftermath of the 2008 housing bust. Vast numbers of Americans becoming welfare recipients rather than taxpayers would be a real tragedy.
The good news is that this situation is entirely preventable — if Congress makes the necessary pension reforms in a timely fashion. Conservatives would be foolish to do nothing and allow this pension problem to become a crisis because once the crisis hits, it will be used to exponentially grow big government and waste trillions in bailouts and giveaways.
Advocates - Government - View - Dire - Circumstances
We can never forget how the advocates of big, bloated government view dire circumstances. Remember Rahm Emanuel’s words, “You never want a serious crisis to go to waste.”
It would be short-sighted for conservatives to do nothing or to delay. Once the crisis hits, the herd mentality will be too strong, and the...
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