Banker: Goes Without Saying Detroit Must Cut Pensions - Reuters?MSNBC

[WillyT]

Banker: Goes without saying Detroit must cut pensions
Reuters?CNBC
Published: Friday, 25 Oct 2013 | 2:33 PM ET

<snip>

Cuts to Detroit's public pensions and retiree healthcare were inevitable given the city's sagging finances, a top consultant for the city testified on Friday during the third day of a trial to determine whether the city is eligible for bankruptcy.

Money owed to Detroit workers and retirees is a key factor in the case, which will also hear testimony by Kevyn Orr, Detroit's state-appointed emergency manager. Orr is expected to explain efforts to negotiate with the city's numerous creditors, including retirees and pension funds, before deciding to file for the largest-ever Chapter 9 municipal bankruptcy on July 18.

A key claim made by attorneys representing the city's unions, retirees and pension funds is that Orr and his team were intent on filing for bankruptcy and did not make best efforts to negotiate with them prior to the bankruptcy filing. They also claim that plans to cut pensions would violate the Michigan Constitution.

On Friday, city financial consultant Kenneth Buckfire said he did not have to recommend to Orr that pensions for the city's retirees be cut as a way to help Detroit navigate through debts and liabilities that total $18.5 billion.
<snip>

More: http://www.cnbc.com/id/101144718

[raging moderate]

1. And then will he pretend that these pensioners did not save for retirement?

Will we hear that it is their fault they have to live under a bridge and eat garbage? That they should have been putting a little money aside from each paycheck and investing it? And will everybody studiously ignore the fact that these workers had been doing just exactly that: it is called a pension program. Back in the old days, briefly in our history, there used to be rules about the management program to prevent financial sharks from blithely stealing the money from lower-income workers' pension programs.