The Public Pension Crisis
Jack M. Beermann

Boston University School of Law Working Paper 12-48 (September 14, 2012)
Washington & Lee Law Review, vol. 70, no. 1

Abstract

Unfunded employee pension obligations will present a serious fiscal problem to state and local governments in the not too distant future. This article takes a looks at the causes and potential cures for the public pension mess, mainly through the lens of legal doctrines that limit public employers’ ability to avoid obligations. As far as the causes are concerned, this article examines the political environment within which public pension promises are made and funded, as an attempt to understand how this occurred. The article then turns to ask if states could implement meaningful reforms without violating either state or federal law. In particular, the article looks at state balanced budget requirements, state constitutional provisions regarding public employee pensions, and federal constitutional law, and asks whether states could significantly reduce their pension promises to public employees without violating the law. The entire analysis must also be informed by the concerns of the employees and retirees whose perhaps sole source of retirement income would be reduced by changes in benefit levels. The article concludes with remarks placing the matter in that context, raising the possibility of a bailout to ameliorate the possibly disastrous consequences of reform to public employees and retirees.

Number of Pages in PDF File: 83

Keywords: public pensions, contract clause

JEL Classification: H72, J32, K12, K23, K31

Accepted Paper Series


Size: 300 KB


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Jack M. Beermann Contact Information:

beermann@bu.edu
Professor of Law and Harry Elwood Warren Scholar, Boston University
Boston University School of Law
765 Commonwealth Ave
Boston, MA 02215
USA
(617) 353-2577

SSRN Site:

http://ssrn.com/abstract=2131481

Presentation and Publication Information:
Jack Beerman, "Midnight Rules: A Reform Agenda," SSRN No. 2121796, Michigan Journal of Environmental and Administraive Law, forthcoming, Boston University Public Law & Legal Theory Research Paper No. 12-46.


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