Page 845 - Pensions News Today

Approximately another $3.5 million is unfunded pensions. only $2 million roughly of that $12 billion or so is related to unsecured bond debt, the vast majority of it has to do with pensions and health care. >> why not seek a bailout? new york city in the 70s got a bailout from the federal government. why not try to seek a bailout from the state or the federal government? >> that was a different time, first of all. these are problems of detroits own making. if we go back and look at the jen sus o...

Is this the beginning of the larger conversation about cities and states who are worried about long-term debt issues on pensions and sort of becomes a come to jesus moment for public sector movement and cities to say we have to deal with this crisis? >> i think so. some will use this as an example to needing to talk about these issues. that being said, your government you made -- you made promises to your people and i dont think that can be swept under the rug. i understand why detroit is going ...

On police calls. thats absolutely unacceptable. in the big picture there are a lot of wonderful things going none detroit in terms of the business community, young people moving in to detroit. being excite things going on outside of city government. we need to resolve this issue with city government and detroit. thats the last obstacle to saying now we can grow detroit. we can get back to being the great city it deserves to be again and thats critically important to making michigan a great state...

It has been going on for decades. youve had a huge population decline, population down 63% in the past six decades, fewer people paying taxes, the decline of the auto sector, corrupt politics, wasted money. the governor issued this letter that just came out saying that he does not see any alternative for detroit other than to file for bankruptcy saying it the only reasonable choice at this point in time because the financial situation has gotten so dire in the city of detroit. he also, though, p...

Someone whos living their retirement on a pension. as a practical manner, the bankruptcy process is a better process in the sense that they can have more thoughtful representation. so one of the first things they ask for is to get representation for the retirees that really wasnt possible without being in the bankruptcy situation. >> do you have a ballpark number? how many people, directly, are going to either lose their pensions, their medical benefits, other guarantees that they thought they h...

Ask you about this. when we look at wall street, you had record highs today for the dow, dow jones industrial average, as you know, highest close for the nasdaq since september of the year 2000, on the same day that we have the biggest citi bankruptcy in american history. those two things seem like they cant be happening in the same country, but they are. fed chief ben bernanke was testifying to congress saying he thinks things are getting better. the dow plunged more than 560 points in just two...

So while negotiations with representatives of these pension funds and with representatives of the unions to bargain down that debt were going poorly. you had some of these representatives trying to restrain the city from filing bankruptcy. the emergency manager was forced to rush this paperwork in and get it into the courthouse which did he this afternoon the real dispute unfunded portion of the liability. until they are funded those benefits continue. comes downtown funded portion and for detro...

And health care benefits have put -- have been put in front of other liabilities. so bankruptcy is a possibility. i wont go that far. ill only suggest, in terms of the stock market and in terms of its relationship to how the united states is doing, the united states is growing at a 2% rate. its better than most developed countries, but its not growing as we once were. its not a 3% to 4% growth rate, and so stock prices at historical levels that expect a return to those growth rates are bound to,...

Upon year -- >> right. >> -- eventually youre going to run into a buzz saw. >> absolutely. each governmental administration thought that the hour of reckoning would come on somebody elses watch. i would not imagine that anybody dreamed that this would happen. now its in the hands of a federal bankruptcy judge and he will decide who is going to get paid what. >> how much authority for that judge? >> almost absolute authority and rarely interfered with an appellate court. he will take all of the o...

Thank you, sir. >> my pleasure. >> back to detroit. the biggest u.s. municipal bankruptcy in history, how big of a deal this really is. this is big news. >> its huge news. if you want to become that detroit, michigan -- and im from clevelanding ohio so very similar -- in 1950, detroit had a population of 1,850,000. today the population is a little over 650,000. the income tax came into michigan in 1970 under governor romney and this state has literally imploded. the first of many that will happe...