DAVID BIANCULLI

Founder / Editor

ERIC GOULD

Associate Editor

LINDA DONOVAN

Assistant Editor

Contributors

ALEX STRACHAN

MIKE HUGHES

KIM AKASS

MONIQUE NAZARETH

ROGER CATLIN

GARY EDGERTON

TOM BRINKMOELLER

GERALD JORDAN

NOEL HOLSTON

 
 
 
 
 
PBS' 'Frontline’ Examines Pension Promises and — Spoiler Alert — Finds the Math Doesn’t Add Up
October 22, 2018  | By Alex Strachan  | 204 comments
 

Picture if you will, a corporation that makes a product people not just want but need, a corporation that puts all its efforts into boosting this quarter’s profit statements, with little thought for what comes afterward.

Picture that you’re a shareholder who has contributed to the corporation’s portfolio your entire working life. You’re counting on your shares to keep you comfortable when you’re old and infirm, and no longer able to work.

Picture that, one day, with little warning and without your knowing it, the corporation reveals it has amassed massive debt, much more than its stock is worth, and you’re facing financial ruin at that exact time in life when you’re least able to deal with it. What do you do? What can you do?

That’s the question that drove veteran PBS' Frontline correspondent Martin Smith when he began research on his latest investigative report The Pension Gamble (Tuesday, 10:00 p.m. ET, check local listings).

Don’t scoff. For “corporation,” substitute “state government;” for “stock portfolio,” substitute “government pension.”

Among the sobering details Smith and longtime Frontline producers Marcela Gaviria and Nick Verbitsky discovered straight out of the gate is that nearly half of state governments across the U.S. haven’t saved enough money to pay the pension benefits they’ve promised their workers.

The cumulative red ink adds up to trillions of dollars — not billions, but trillions.

You don’t need an advanced degree in economics — a grasp of basic math will do — to realize that the potential fallout could equal the effects of the 2008 subprime mortgage crisis, which cost the economy $12.8 trillion (according to the non-profit financial reform advocacy group Better Markets in 2013).

As with past Frontline investigative programs, The Pension Gamble doesn’t have any silver-bullet solutions; it’s more of a step-by-step, painstaking account of how the perpetrators of a crisis got themselves into a mess, more often than not of their own making. The Pension Gamble is about the process, not the solution. If Frontline’s producers had any answers, they probably wouldn’t be making investigative programs for PBS.

Still, the news is about telling us things we didn’t know before. The best news programs — and Frontline is up there — tell us what we need to know, not necessarily what we want to hear. To know a thing, you have to know where it begins and ends, and where its edges are.

And the story Smith uncovers in The Pension Gamble is worrying. (Why we have to learn about this on PBS, rather than, say, Fox News, is a question for another day. An entire graduate course in journalism could be based on that one issue alone.)

The Pension Gamble focuses on Kentucky, an ardently — and unapologetically — conservative, Republican-voting state that prizes family values, hard work and making personal sacrifices to make ends meet. Hard work is rewarded, or so people are taught from an early age. Laziness will not be countenanced. “Work shy” are not words you often hear in Kentucky.

As Smith points out in The Pension Gamble’s opening moments, though, “This is a story about gambling, and making bad bets.”

It’s about having a retirement that you thought was secure go south — and not to the sunny climes of Florida and Arizona, where retirees flock to get away from the brutal winters of the urban Northeast and rural Midwest.

To dismiss government workers — as some do — as being somehow less worthy, less deserving than those who choose to work for private industry is lazy and disingenuous. Government workers aren’t just paper pushers — they include teachers, police, firefighters, paramedics and other first responders. Frontline producers chose Kentucky, Smith says, because the Bluegrass State’s pension scheme is among the most underfunded in the country.

As a gag, but also to illustrate a point, Smith places a $100 bet on a horse named “Promises Fulfilled” in the Kentucky Derby. He doesn’t expect much: The horse is rated a 50:1 long shot.

“On the other hand, if it won, I would win $5,000.”

Spoiler alert! You can guess the rest. (Though not how: In the grand tradition of TV, the actual race turns out to feature more twists and turns than you might expect.)

What happens in Kentucky doesn’t stay in Kentucky. “It matters what happens in Kentucky,” says Kentucky Gov. Matt Bevin (R). “Because what is Kentucky’s problem is New Jersey’s problem, is Illinois’ problem, is Connecticut’s problem, is California’s problem, and just on and on and on.

“This is a crisis of epic proportion in the United States of America, and it’s time to wake up and address it.”

The social contract lies at the heart of The Pension Gamble — the unspoken idea that, in exchange for lower pay than they might get in private industry, government workers will be looked after later in life, and have money deducted from their paychecks along the way to help pay for it.

Over time, though, faced by one crisis after another, state governments took money set aside for pensions and assigned it to general revenue. The trouble with that, as more than one economist notes in the program, is that one day the bill will come due. Kentucky was hit hard in the 2008 market crash, but it was not alone.

Wall Street hedge funds jumped into the fray, pushing the familiar line, “No risk, no gain,” eager to prey on gullible state governments desperate to recoup their losses in the market crash.

In the end, one of several experts cited midway through The Pension Gamble cites a familiar refrain: There were abuses. No laws were broken, but disclosure rules were shuffled aside and overlooked, where they weren’t ignored entirely.

With state pensions, as with so many other things in life, the law and the spirit of the law don’t always meet.

As with other Frontline programs, The Pension Gamble might not seem like entertaining viewing at first glance. Anyone interested in pension funds and how they work — or don’t work — should give it a look, though. Every so often, a fishing expedition lands a big one.

 
 
 
 
 
Leave a Comment: (No HTML, 1000 chars max)
 
 Name (required)
 
 Email (required) (will not be published)
 
SRPBC
Type in the verification word shown on the image.
 
 
 Page: 1 of 11  | Go to page: 
204 Comments
 
 
Skylight Pro is the preferred choice for a full array of all skylight-related services on Long Island. Call 631.319.7888.
Feb 6, 2023   |  Reply
 
 
Just before you decide to create your own checklist to incorporate an idea associated with what camping checklist ought to. Really … A listing can be well over what you need.
Feb 5, 2023   |  Reply
 
 
Your music is astounding. You have some exceptionally skilled specialists. I wish you the best of achievement.
Feb 4, 2023   |  Reply
 
 
This is the first time that I visit here. I found so many exciting matters in this particular blog, One thing I would like to request is you that pls keep posting such types of informative blogs.
Feb 3, 2023   |  Reply
 
 
This is such a nice useful resource that you are supplying and also you meet the price of it away for forgive. I hero reward seeing websites that take at the value of supplying a setting useful resource for set wandering. it’s far the primeval what goes on the order of comes almost about recurring.
Feb 2, 2023   |  Reply
 
 
Thanks, are you looking for real estate in Longwood, FL? Learn where the deals are, getbank owned property lists and find homes for sale in Casselberry.
Feb 1, 2023   |  Reply
 
 
I really love the theme on your web site, I run a website , and i would love to use this theme. Is it a free vogue, or is it custom?
Feb 1, 2023   |  Reply
 
 
I really love the theme on your web site, I run a website , and i would love to use this theme. Is it a free vogue, or is it custom?
Feb 1, 2023   |  Reply
 
 
Artificial Grass Liquidators
Travelling is normally described as the act of traveling from one specific region to every other for a special cause. Although this definition includes folks that tour often with a purpose to advantage understanding or revel in themselves, it also has an academic value.
Jan 31, 2023   |  Reply
 
 
Thanks for the blog loaded with so many information. Stopping by your blog helped me to get what I was looking for.
Jan 31, 2023   |  Reply
 
 
Thanks a lot for sharing this with all folks you really understand what you are talking approximately! Bookmarked. Kindly also visit my web site =).
Jan 29, 2023   |  Reply
 
 
I couldn’t refrain from writing comments. “Diversity the art of thinking independently together.” by Malcolm Stevenson Forbes..
Jan 29, 2023   |  Reply
 
 
I couldn’t refrain from writing comments. “Diversity the art of thinking independently together.” by Malcolm Stevenson Forbes..
Jan 29, 2023   |  Reply
 
 
The content is top character, you can easily find numerous exclusive. There is something special about them.Thanks for sharing this valuable information with all of us and if you are searching for the best. Please do keep up the great work.
Jan 26, 2023   |  Reply
 
 
Your article has really similar opinion to mine so we can discuss well together, and finally our lives will be much happier in the future.
Jan 26, 2023   |  Reply
 
 
I’m happy I located this blog! From time to time, students want to cognitive the keys of productive literary essays composing. Your first-class knowledge about this good post can become a proper basis for such people.
Jan 24, 2023   |  Reply
 
 
There's a problem with your site in chrome, and you may want to check this... The browser is the market leader and a huge component of other people will omit your wonderful writing because of this problem.
Jan 22, 2023   |  Reply
 
 
Thank you for some other informative website. The place else may just I get that kind of information written in such a perfect method? I have a venture that I am simply now running on, and I've been at the glance out for such info.
Jan 19, 2023   |  Reply
 
 
The content is top character, you can easily find numerous exclusive. There is something special about them. Thanks for sharing this valuable information with all of us and if you are searching for the best. Please do keep up the great work
Jan 18, 2023   |  Reply
 
 
We Provide Nationwide property and appraisal services easily communicate with all their clients in a single website rather than having multiple window for each client. We designed site for all lenders in a way to communicate with real estate appraisal near me vendors in a single medium.
Jan 18, 2023   |  Reply
 
 
 
 Page: 1 of 11  | Go to page: