Pension feedback again

California Policy Center does the numbers on pensions:

–  To summarize, for every sustained 10% drop in the value of pension fund assets, California’s state and local government pension funds will require another $7.0 billion per year. In reality, however, it could be worse, because a serious market correction could trigger another reassessment of the projected earnings.

The bold face is the negative feedback, that drives hiring freeze and pension stampede.  This is second time through the loop, so the loop cost is marked to market earlier in the downturn.