Unfunded Pension Plan

Just see: Unfunded Pension Liabilities.

This very bad situation happens when companies and governments aren't thoughtful about budgets. A school teacher works for 30 years at what she feels is "below market wages," i.e., below the market of what she thought her talents would bring, so that she could do good things for smart, curious brains. She works for $42,000 a year for a long time, with the mitigating financial event being that the state for whom she works is contributing $6,000 a year in pension money for her, so that when she retires, she has well over half a million bucks in an index fund sitting around for her.

But, in fact, many states won't have nearly enough money to pay out the dough she is due. So...what then happens? If the state goes bankrupt, does the federal government bail them out? That would be highly unfair to states who were responsible with their money, right? Like...if you gave each kid $50 a week to put away for a college fund and 3 of your 4 kids dutifully did so...but the 4th just spent it all on candy and meth...why would it be fair, when that 4th kid is ready to go to college, for you to then just give her the dough she spent? How would kids 1, 2, and 3 feel then?

Tough political issue. Bad moon a-risin'.