Unfunded Public Pension Liabilities Exceed $8.2 Trillion

“Unfunded state pension liabilities total $8.28 trillion or just under $25,000 for every man, woman and child in the United States. This is an unprecedented amount in the history of this report, but most of the change is the result of a decrease in the risk-free discount rate, caused by the decrease in U.S. Treasury note yields. State governments are obligated, often by contract and state constitutional law, to make these pension payments regardless of economic conditions. As these pension payments continue to grow, revenue that could have gone towards tax relief or essential services like public safety and education is spent paying off these liabilities instead.”

Published by markskidmore

Mark Skidmore is Professor of Economics at Michigan State University where he holds the Morris Chair in State and Local Government Finance and Policy. His research focuses on topics in public finance, regional economics, and the economics of natural disasters. Mark created the Lighthouse Economics website and blog to share economic research and information relevant for navigating tumultuous times.

Leave a Reply

%d bloggers like this: