States Take Action to Combat $1.26 Trillion Shortfall

Mike Brownfield / April 26, 2011

States are facing a whopping $1.26 trillion shortfall in funds to pay pension and health-care benefits for public sector employees, according to a new study by the Pew Center on the States.

Wisconsin and Ohio, both of which made headlines for working to get pension costs under control, aren’t the only ones taking action. According to The Washington Post, “Concern about underfunded pensions has prompted at least 29 states to either reduce pension promises to new employees or require workers to contribute more toward their retirement benefits.”

And in California, where the state is struggling to cope with its $25 billion budget shortfall, a new poll shows that public opinion has shifted in favor of cutting benefits from public sector employees, as the LA Times reports: (more…)