The effect of adopting proper accounting methods reveals why so many governments are reluctant to do so: combined U.S. public pension debt would rise from $1.7 trillion to more than $5.6 trillion!The cost to service this debt would most likely cause a wave of defaults, like what has already happened in the commonwealth of Puerto Rico and cities like Detroit, Michigan and Stockton, California.Exactly correct.
Most of the recovery was about keeping the pension fiction alive, and it is culminating in a conspiracy of the Cal pension funds to melt up the market. The plan, as near as I an tell, is to push all the reforms into the next recession, in 2018. Then, suddenly have a California debate of enormous proportions.
Jerry has figured out the melt up plot and is facing a catastrophe. Hence his sudden desire to rig the courts here and over rule perfectly legal pensions. But with housing now facing a mortgage crises, it is too late for Jerry.
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