Is Rick Perry’s $92,376 pension a harbinger of a major fiscal crisis? – The Washington Post

Is Rick Perry’s $92,376 pension a harbinger of a major fiscal crisis? – The Washington Post.

Is Rick Perry’s $92,376 pension the harbinger of a major fiscal crisis?

at 04:51 PM ET, 12/19/2011

Critics of government aid to public employees have a new favorite target for the system’s largesse to retiring federal workers: Governor Rick Perry. This year, the 2012 Republican hopeful took advantage of Texas’ generous pension rules to begin receiving a $92,376 annual pension even before leaving office and giving up his $150,000 annual salary as governor.

Texas’s “early retirement” rules allow for state employees with many years of military and public service to receive pension benefits even before they retire, the Texas Tribune explains. Perry insists that his early benefits are nothing “out of the ordinary.” Critics say that’s precisely the problem, arguing that such perks to government workers are bankrupting taxpayers and saddling states with pension obligations they won’t be able to meet.

[…]

A vocal cadre of Republicans, led by Sen. Jim DeMint (R-S.C.), are arguing that state public pensions are now the country’s next great “debt crisis.” In a new report titled “States of Bankruptcy,” they point out that 11 states are projected to run out of money to pay for pensions by 2020 if they don’t take further action. And they argue that special accounting rules that states use grossly underestimate the liabilities they actually face. By the private sector’s accounting standards, states are actually facing a $3 trillion total pension gap—more than twice the standard estimate. DeMint claims that the funding gap could lead to major tax increases and possibly “the Mother of All Bailouts” by the federal government as unfunded pensions come due.

[…]

Read the full story here: The Washington Post

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