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FBN’s Lou Dobbs on the factors that led to San Bernardino, California’s bankruptcy.
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And -- I was just admiring her title here tonight belly up.
In San -- you know it's almost lyrical isn't going to be a very proper term perhaps.
San -- I was now the third -- in California to go bankrupt in under a month.
That's city of just over 200000.
People is basically broke.
It won't be able to make -- payroll by the end of the summer the the city fathers and mothers paper variety of reasons including.
And I'm not gonna write these down but it seems to be pretty clear that those reasons would include incompetence.
Stupidity.
Fiction based accounting crony corruption.
And in different citizenry and -- -- Out of control and I mean wildly out of control public employee pensions.
-- that it's fair and how to control -- be.
-- San Bernardino is setting a standard for how out of control it can be think about this.
9000.
Former employees.
All laws.
-- taken down 300.
Million.
Dollars.
And tensions here.
Oh.
You know -- -- think that's pretty -- right.
They're ready to have supply because.
-- 500 of these votes.
500.
We're gonna rabbit.
500 of them.
Are taking on more than 100000.
Dollars in the year.
100000.
Dollars.
A year.
Impressive.
If you think that's well what's -- generous.
-- -- -- The jackpot.
They're making more in retirement.
And they hurt when they were actually a market which is it may be a little bit right.
Well there -- making on average.
60000.
Dollars.
A year.
More.
If retirement but it won't want to.
-- a better perspective the average American worker is making about 41000 dollars a year 41 grant.
But in being stupid and -- competent and in different.
San Bernardino is not alone -- every -- three California cities to file for bankruptcy.
Or planning to file for bankruptcy and just this past month including Stockton in the mountain resort town of mammoth what.
-- stock and get into trouble.
They offered extremely generous pensions that allow public safety employees to retire at the age of fifty.
-- write this down because it's.
At its soul.
So easy not to believe it and what you see.
To retirement age of 51.
What I consider to be a fairly generous pension.
You ready.
90%.
Them pay.
-- -- On a national level many believe that these -- these tensions and these public employee.
Time bombs are in a rare.
But the fact is Moody's Investors Service -- states and municipalities in this country run up.
More than two trillion dollars of unfunded pension liabilities a report by JPMorgan Chase says the real number there.
The real number there we're talking about its three point nine trillion.
-- That's because governments aren't setting aside enough money obviously do.
On those benefits.
Fortunately many cities and states are feeling the pressure to take action last month voters and San Diego San Jose -- steps to pare back public sector retirement benefits.
Manageable problem.
Because we got fifty states.
Fifty states.
And then we have -- -- local jurisdiction that creates tension football problem.
40000 up 40000.
State.
Counting.
Townships and cities.
40000 municipal government 161000 township 3000 county government.
Who knows what's gonna happen next.
One thing and guarantee that when it does happen you'll hear about it here.
It's something to think like -- -- people in San -- -- -- -- not to upset with me I gotta say.
You really need to get upset with somebody.
