This provides a dramatic illustration of what has for years been political business as usual for liberals in public office. To save their own jobs, they cut deals with your money, offering premium benefits and exorbitant salaries to public workers. Much of the cost is deferred until these employees retire, and so the unfunded liabilities of public pensions have become enormous, threatening states and cities with imminent insolvency. By some estimates, state and municipal governments will have to come up with $3.5 trillion in new funds just to keep the pension checks going out. Things are so bad in California that state officials had to commission an independent Stanford University study just to get a handle on its pension liabilities, which turn out to be a staggering $535 billion.
The true total of unfunded liabilities is not clear because many public pension systems -- including that of Illinois -- are not held to basic standards of transparency. To solve this problem, Rep. Devin Nunes, R-Calif., along with House Oversight Chairman Darrell Issa, R-Calif., and House Budget Chairman Paul Ryan, R-Wis., have reintroduced a novel solution first reported in these pages a month ago. The Public Pension Transparency Act would require states and municipalities to hand over complete information about their pension funds to the U.S. Treasury Department as a condition of receiving federal tax exemptions for the bonds they issue. Treasury will then make the information public, so that taxpayers and investors can see what's really going on with state and local government public pension systems.
Predictably, the public employee unions don't like this one bit. They know that once the public gets wind of how badly liberal politicians have overpromised on public employee retirement benefits, officials will be forced to reform the systems. Genuine transparency could bring a sudden end to decades of sweetheart deals, free health insurance, and overly generous defined-benefit retirement plans for public employees. America's well-compensated professional civil servants deserve the same treatment as their private-sector counterparts, who typically contribute to their health plans and fund their own 401(k) retirement plans. As with any addiction, the first step to recovery is admitting that you have a problem. Nunes' bill is a good place to start.