Far left blog fails Accounting 101
The far left Eclectablog recently criticized Michigan Capitol Confidential for reporting on the unfunded liabilities of teacher pensions and retiree health care. The post was in response to a CapCon story that showed the skyrocketing cost just to catch up on the underfunded costs for public school employees — taxpayers now spend more on that than the corrections system.
"[CapCon] like[s] to call retirement pensions and the health care of teachers 'liabilities'. ... Calling them 'liabilities' is, of course, intentional. It makes teachers look like parasites, demanding more than their share of the pie at the expense of everyone else."
For the Record says: Calling them "liabilities" is using a basic accounting term. An “unfunded liability” used in the context of a story on MPSERS is the value of pension benefits promised to employees in which employers have not set aside adequate funds to cover. It is NOT referring to the pensions and health care benefits received by retirees. Those are “benefits.”
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.