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I don’t see anything in that about cutting accrued benefits, which require bankruptcy to change, and would be huge news as it was for Detroit and Rhode Island. NJ has hundreds of billions in unfunded accrued benefits, I.e. debt.

It’s designed to seem that way.

Arizona: Retired and current active members Replaced the Permanent Benefit Increase (PBI) with a compounding COLA to be based on CPI for the Phoenix region, with a 2% annual cap. This was done to save money over time, even if people see the same check today it’s noticeably lower in 10 years. Over a possible 40+ year retirement the difference is huge.

Arkansas: Current retirees Reduced automatic COLA from 3%, compounded, to the lesser of 3% or CPI, compounded. Again a single year at 2% compound vs 3% compound reduces outstanding debt by 1%. Over 20+ years it makes a huge difference.

Colorado: (2018) Retired and current active state employees. Suspended COLA for two years(2018 and 2019) They did more, but that alone reduced their liabilities by around 5%. They had already done a similar thing in 2010 by requiring retirees to wait over 1 year for their first COLA and reducing the cap from 3.5% to 2%.

I could go on but you find a lot of these changes that often add up to a 10+% reduction in benefits and thus costs.

Yes, while those states are doing a better job, that won’t do anything to lower the unfunded accrued liabilities. It’s going to come out of future tax receipts, effectively giving future taxpayers the option of paying more taxes and/or accepting reduced services. Other solution will be for Fed to print more dollars and inflate away some of the debt, which I’m sure they will do as they always have.

Lowering long term benifits for current retirees directly reduces liabilities.

If I sell a bond paying 5% interest, then say sorry only paying 4% that’s a lower liability.

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