In my last blog, I commented on a July 11 article by Mary Walsh of the New York Times on the crisis relative to horrifically large pension and retiree medical obligations for government employees. Coincidentally, as I traveled to and from Europe between July 15 and 20, I had an opportunity to catch up on reading, and I read Roger Lowenstein’s great book While America Aged.
In this book, Lowenstein details the history of three out-of-control pension and retiree medical commitments, the commitment by the Big 3 automakers to their employees and retirees, the commitment to the Transit Workers Union and other municipal unions in New York City, and the commitment to San Diego’s municipal workers. He draws broader conclusions from these analyses, consistent with Mary Walsh’s. As Lowenstein puts it on page 1: “America has a crisis of epidemic proportions. The fabric of the nation’s pension system is collapsing – at the very moment when the American population is rapidly aging.” (more…)