California's Brown Raises Prospect of Pension Cuts in Downturn - Bloomberg

California's Brown Raises Prospect of Pension Cuts in Downturn - Bloomberg:
"California Governor Jerry Brown said legal rulings may clear the way for making cuts to public pension benefits, which would go against long-standing assumptions and potentially provide financial relief to the state and its local governments.
... The state’s Supreme Court is set to hear a case in which lower courts ruled that reductions to pensions are permissible if the payments remain “reasonable” for workers.
...Across the country, states and local governments have about $1.7 trillion less than what they need to cover retirement benefits -- the result of investment losses, the failure by governments to make adequate contributions and perks granted in boom times..."
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