Even if we reform pensions today, there's already a time bomb of unfunded liabilities that will force a combination of severe tax increases and drastic cuts to services:
An August report by the Kellogg Graduate School of Management at Northwestern University found government pension programs in as many as 31 states are headed for financial disaster by 2030 and that taxpayers will likely wind up paying for unfunded liabilities.
“Even if states uniformly eliminated generous early retirement deals and raised the retirement age to 74, the unfunded liability for promises already made would still be more than $1 trillion,” Kellogg associate professor Joshua Rauh said in prepared remarks.
“Assuming states don’t start defaulting on their bonds and other debts, it seems that taxpayers will be footing most of the multi-trillion dollar bill for the pension promises that states have already made to workers,” he added.
We're in a huge hole and Dan Dalager, Jerome Stocks, and Maggie Houlihan are still digging.