A New History For U.S. Pension Funds

As many Americans celebrate the Fourth of July with sparklers and picnics, it is notable that public pension plans in the United States are undergoing radical changes. From their original inception as rewards for civil servants and military personnel, retirement plans are often now seen as costly drains on municipal and state coffers.

A few days ago, the Atlanta City Council voted unanimously to reform its pension plan and thereby "generate $22 million to $30 million in savings over the next 10 years and $500 million over the next 30 years."

Jurists in Colorado and Minnesota recently said "no" to public retirees who sued to reinstate reduced benefits on the basis of alleged contractual guarantees.

While Monday is an official day off for many individuals, it's back to work on Tuesday July 5 with continued debates in town halls throughout the nation (and abroad) about employee benefit plans.

Related Links For Readers:

• A History of Public Sector Pensions in the United States by Robert Louis Clark, Lee A. Craig, and Jack W. Wilson, University of Pennsylvania, March 2003;
• "Atlanta City Council Approves Pension Reform," WSBTV.com, June 29, 2011;
• "Gary R. Justus et al v. State of Colorado...," June 29, 2011;
• "Howard Swanson et al vs. State of Minnesota..." March 22, 2011; and
• "Two Rulings Find Cuts in Public Pensions Permissible" by Mary Williams Walsh, New York Times, June 30, 2011.

Source: http://feeds.lexblog.com/~r/PensionRiskMatters/~3/Y_83p5wcK2o/

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