The Economist has a recent article discussing the severely underfunded Illinois pension plans. Illinois has over promised, under funded and does not have the political will to deal with this issue.
The implementation of Government Accounting Standards Board Statements 67 and 68 over the next two years will convert these promises (liabilities) from obscure measures buried in the foot notes of audited financial statements into full blown long-term liabilities.
The Economist quotes Hal Weitzman of the University of Chicago Booth School of Business, “Illinois is like Greece in one obvious way: it over promised and under delivered on pensions and has little appetite for dealing with the problem.”
