A brief article in this week's Forbes explores the mounting debt crisis facing state, local and national governments worldwide; the title suggests one possible cause, "The Economic Incompetence of The Political Class." One startling factoid: The city of Chicago's unfunded pension liabilities are $25 billion, or $40,000 for every city household.
For comparison, the nominal unfunded liability figure for Michigan is around $50 billion, but this falls to just $11.5 billion after deducting the "politician promise" of state retiree health benefits that taxpayers are not legally obligated to pay. Michigan has more than three times the population of Chicago.
The blame here and elsewhere ultimately falls on citizens who enabled politicians to rack up the massive liabilities, and the piece aptly describes the false assumption at the root of this and countless other government dysfunctions:
In the U.S. at least, the looming debt crisis among states and municipalities also reflects a lack of diligence on the part of the citizenry. This can be attributed in part to a naïve assumption by the electorate that those in government, freed from the profit motive, could be trusted to do what was 'right' for the community as a whole.
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