Risky Business: Hoping High Returns Fund The Pension Gap

A Video Infographic for Hoover Institution

#Education

PART 3

In order to keep taxes low and prevent cuts to services, state politicians effectively borrow massive amounts of money from their pension systems and make risky investments to offset the budget shortfalls. They claim that there are no budget shortfalls as long as investment returns remain high. When investment returns don’t materialize, they turn to taxpayers to pick up the shortfall.

See Part 4 of the “Pension Pursuit” series here.