Uncle Sam has an unfunded pension liability of $800 billion.
Corporate pension funds have an unfunded liability around $400 billion.
State and local pension funds have an unfunded liability in the tony neighborhood of $3 trillion.
That's over $4 TRILLION in UNFUNDED pension funds.
And if you're not lucky enough to be in a "defined benefit" pension plan (which fewer and fewer people are these days) there's undoubtedly an "unfunded liability" in your own savings – in other words, you haven't saved enough to retire.
It's a huge problem and it's getting worse. And there's one individual to blame for all that $4.2-plus trillion of money we need to find – Ben Bernanke.
The Killer of Nest Eggs
Bernankeism exerts a double whammy on pension funds, because of the accounting.
To determine the cost of all the pensions that must be paid, the actuary makes assumptions about people's lifespans (another problem – they're lengthening), gets a future stream of cash flows, then discounts the cash flows back to the present at an assumed rate, based on what he thinks the fund can earn on its money.
If the discounted amount is less than the current value of the fund, the fund has a surplus; if it's more, the fund has a deficit.