craschworks

But funding of public pensions has been woefully short of what’s needed to make good on those promises. The shortfalls are “off balance sheet” liabilities that run into the trillions of dollars.

Here’s the bad news as reported by Professors Robert Novy-Marx (University of Rochester) and Joshua Rauh (Northwestern’s Kellogg School of Management):

* Unfunded liabilities for public pensions run by the 50 states total $3.23 trillion — $21,500 per household.

* Underfunded pensions for municipal and local government employees add another $574 billion of hidden debt — $14,000 per household.

The data from federal sources is also grim:

* Unfunded US military-retirement obligations now amount to $30,000 per household.

* Unfunded federal civilian-employee pension obligations represent another $16,000 per household.

That means every US household (including the half that normally pay no taxes) would have to kick in $81,500 today to enable federal, state and local governments to meet just their cur rent pension commitments.