Once Safe, Public Pensions Are Now Facing Cuts - New York Times

These obligations are going to demolish city budgets around the country. It will be impossible to overlook this coming wave when tax-payers are directly responsible for these obligations. The best solution would be to nationalize the municipal and state pension with the federal pension system. That way you could avoid the population/tax base problem (assume that the tax payers are moving within the U.S.) and spread the risk over many different people. It would probably take the bankruptcy of a few major cities or states due to pension obligations for this to happen, but its coming. Here in Illinois, the problem is really bad with one of the must underfunded pensions in the nation. The Trib wrote an article up last week on the issue. No more pension holidays and build up the reserve. A ounce of prevention is worth a pound of cure.