The U.S. can have sound public pensions or sound infrastructure. Choose one.
States and municipalities face the twin crises of collapsing bridges and underfunded pensions and public-sector retirees’ medical costs. The result is that those retirement expenses are crowding out critical infrastructure needs, according to Bank of America Merrill Lynch municipal-finance analysts.
The numbers are so huge that they numb the mind. Unfunded liabilities of state pension plans total $5.96 trillion, or about six times the federal budget deficit, according to a 2018 estimate by the American Legislative Exchange Council, or ALEC, a group of conservative state legislators. At the same time, there are more than 47,000 structurally deficient bridges in the U.S., according to the American Road & Transportation Builders Association—and at the rate we’re going, it would take over 80 years for us to make the needed repairs.
Barron’s
By Randall W. Forsyth
April 4, 2019 8:00 a.m. ET