Biz

Government Pension Funds Are $2 Trillion Short

By FITSNews  ||  You may have missed this nugget last week, but a new report from Moody’s Investors Service reveals that America’s largest government-run pension funds are facing a collective shortfall of more than $2 trillion. The funds have performed fairly well over the last decade – averaging a return…

By FITSNews  ||  You may have missed this nugget last week, but a new report from Moody’s Investors Service reveals that America’s largest government-run pension funds are facing a collective shortfall of more than $2 trillion.

The funds have performed fairly well over the last decade – averaging a return of 7.45 percent from 2004 to 2013 (just below the expected rate of 7.65 percent).  The problem?  The funds’ liabilities have more than tripled – forcing taxpayers to redirect resources in an effort to cover the growing gaps.

“Despite the robust investment returns since 2004, annual growth in unfunded pension liabilities has outstripped these returns,” Moody’s report concluded. “This growth is due to inadequate pension contributions, stemming from a variety of actuarial and funding practices, as well as the sheer growth of pension liabilities as benefit accruals accelerate with the passage of time, salary increases and additional years of service.”

How is South Carolina’s pension fund doing?

Despite paying the highest fees in America, the Palmetto State’s fund consistently ranks among the bottom third of large pension funds in its rate of return.  The commission administering the fund is also notoriously corrupt.

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82 comments

CNSYD September 29, 2014 at 8:23 am

Are federal “pension” funds (e.g. Social Security) included in this total? If so, the culprit is Congress who has for decades “borrowed” from these funds to meet shortfalls in other programs.

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FastEddy23 September 29, 2014 at 10:19 am

SS “trust” funds are at risk, fur sure: 2.7 Million meskin nationals and other non-citizens collect SS benefits but do not contribute … No kidding. Source: US Embacy Social Security in Mexico City.

“No VC ever called me gringo”

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M326 September 29, 2014 at 10:41 am

I never heard the VC call anybody “gringo.” 99.999% of them have no understanding of the meaning of the word. So what’s your point?

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FastEddy23 September 29, 2014 at 2:18 pm

Exactly.

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M326 September 29, 2014 at 10:56 am

Normally, if you collect SS benefits you are not contributing. I collect benefits and am not contributing. You must retire to collect them. Lot’s of US citizens on SS live in Mexico because the cost of living is so much lower. Be sure you got your facts straight. “Embacy?” “meskin?” Eddy, you need spell check!

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FastEddy23 September 29, 2014 at 2:17 pm

Its a good thing I will never run for office … So I can be as politixatlly incorruptible (unaccountable?) as I want.

FARC you.

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Colombia September 29, 2014 at 3:11 pm

Oh my… Your intellect is way below the norm, FastEddy23. You need to go back to school.. You cannot spell and you cannot think. I suggest that you do not post on Fits. People will make fun of you.. Politixatly, Embacy, Meskin, .. Fuerzas Armadas Revolucionarios de Colombia = FARC= a terrorist organization opposed to the Unites States with strong ties to drug dealers. Revolutionary Armed Forces of Colombia= FARC. What in the world are you doing here and posting on Fits. Go back to Colombia, FastEddy23

FastEddy23 September 30, 2014 at 11:53 am

The FARC operates world wide and is very actively pursuing politically “correct”, newspeak spewing, phallicly challenged, “progressive” fascist est-holes. FARC you and the horse you rode in on.

M326 September 29, 2014 at 8:55 am

“… notoriously corrupt.”
I follow this Commission and its activities closely. It has had several extensive audits and investigations lately. There is no finding of corruption of any kind that I know of. Please present your sources. There is an actuarially projected rate of 7.5% return required to maintain the fund’s integrity and eliminate the unfunded liability. The return for the fiscal year ended in June is around 15% net of fees, roughly twice that required to maintain fiscal integrity. Why would you criticize that? Sounds pretty good to me. Watch the amount of Kool Aide you imbibe.

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Thought So September 29, 2014 at 9:57 am

You’re one of the corruption baboon, aren’t you?

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M326 September 29, 2014 at 10:26 am

Rather than use snide insults, why don’t you put some proven examples of corruption on the table? Four examinations, one a fiduciary audit conducted under the auspices of the SC Inspector General found no corruption. It is misleading to state corruption exists and have insults as your proof. If that is the quality of your argument, then who looks like a baboon? I get so tired of Kool Aide drinkers. Don’t you ever require proof for anything you say? Or is it if you say it, regardless of how foolish, it is, ipso facto, true? This baboon thing seems very contagious.

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James September 29, 2014 at 10:48 am

And we have proofs that the corruption and corrupted baboon is Curtis Loftis and his Saluda Foundation , which can be used to launder money….with the help of his 2 million dollars intimate attorney…

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Nick September 29, 2014 at 2:48 pm

Bold face lie.

Beverly September 29, 2014 at 8:13 pm

How do you know?

Beverly September 29, 2014 at 10:05 pm

Statement below sounds fishy to me

Kev September 29, 2014 at 3:03 pm

Not the first person testifying under oath. Not one subpoena. Just half-assed audits or inquiries, paid for by government to get the answers they wanted.

Bonnie and Clyde could run a government agency in SC and get awards for their management while stealing the place blind!

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Sandy September 29, 2014 at 8:57 pm

With this much corruption, somebody should have been arrested. Somebody should have been fired. Yet…nobody was. Could it be this is just some fiction in a twisted mind? Why are so many staff leaving the Treasurer’s office? Maybe they don’t like the loss of $18,000 per day Loftis is creating in the retirement fund by not approving an investment he voted for. Just a thought.

Nan September 29, 2014 at 9:06 pm

SC is a corrupt place. Crooks like Reynolds Williams have the upper hand because they are protected by powerful politicians. Loftis has made great changes just by being persistent, and staying on target and holding people accountable.
Indictments will follow. Just stay tuned.

Mildred Pierce September 29, 2014 at 9:16 pm

Yes indictments will follow. Just watch the treasurers office. This guy is a real nutcase waiting to happen.

James September 29, 2014 at 9:08 pm

I remember when DSS was sent to Bridgett’s house and she complained about her dad, exposing himself to her every night. The examination made by that government agency was half-assed. Her dad started screwing her not long after. Damn DSS has always been shit.

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Crap September 29, 2014 at 9:39 pm

Please, tea party ladies. Go help this very sick sorry man. Delinda and Co. Go help him! He is insane , too much for any person to take. Curtis Loftis is insane, no question about this. And he posts pictures of churches on his Facebook and he never goes to church.. An impostor , a liar and infected with incurable crap.

exposed September 30, 2014 at 12:43 am

Curtis, this is your lowest post ever. Make me sick .. Your are sick, very sick and I will challenge you to talk to me about this post. I challenge all your tea party ladies to talk to me about this . The tea party ladies will allow Curtis Loftis to post violent, insane and pervert statements about a father, a daughter, a mother. And Curtis Loftis does not spell the name correctly. Show you what a jackass we have in Curtis Loftis. The one exposing himself to the retirees trust fund is Curtis Loftis.. Every day, now $18 000 a day. When was DSS sent to .. Please, tell , we want to know.

Justice September 30, 2014 at 8:31 am

God have mercy on your soul, James = Curtis Loftis.

FastEddy23 September 29, 2014 at 10:13 am

G’ment auditing g’ment? No prob, right?

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Alex September 29, 2014 at 2:47 pm

And in 2012 when they made 60 basis points? That is 690 basis points less than they needed!

The long haul is the measure that is important. The Commission made 15.29%, in 2013 but is still in the bottom 30 % of their peers. They underperformed by $450 million dollars this year alone. This does not matter much in a bull market. However, it matters a great deal in a. Bear market.

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Mel September 29, 2014 at 8:38 pm

The annual report of the Investment Commission indicates they made 11.5% return on investments in 2012. Where do you get your figues? 60 basis points is less than 1%. Alex, I think your figures are wrong. Sorry.

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nitrat September 29, 2014 at 4:01 pm

The enormous California state pension plan Calpers recently dumped all hedge funds because they are such ripoffs.

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Mac September 29, 2014 at 4:27 pm

And so did the huge pension plan of Denmark, and several states are reconsidering their exposure too.

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vic September 29, 2014 at 6:30 pm

And several states are getting into hedge funds aggressively. Go figure. No two of these pension funds are the same and each have different needs. In Calpers only 1.5% of the fund was in hedge funds. They just decided the juice wasn’t worth the squeeze. To have the countercyclical effect hedge funds are supposed to have, their choice was to either dramatically increase that investment or get out entirely. They simply made a choice.

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sconset987 September 29, 2014 at 9:21 am

FITS I know you are Curtis Loftis’ lackey but in the interests of at least a semblance of journalistic accuracy you really need to stop repeating his crazy assertions that the SC pension fund is in the bottom third for performance and that it is corrupt. Everyone who has looked into his allegations have concluded they are absolutely untrue.

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Hehehe September 29, 2014 at 10:36 am

Curtis Loftis will never learn because He is not able to learn. His friend got 2 million dollars and he lost millions from the retirees trust fund. Money lost for ever. Curtis must be removed from the commission and be replaced by a person with credentials and qualifications, like the other members on the commission. A bug exterminator with the brain of a cockroach is not fit to be a good steward of our money. The legislature must take action in this matter. Loftis has lost so much of our money. Replace him!!

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Don September 29, 2014 at 9:03 pm

The people just spoke to this issue and reelected Loftis. He will be Treasurer till 2019. Haters hate, but voters vote, mainly to protect their wallets from big government scum like you.

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Bobby September 29, 2014 at 9:18 pm

Wait, they got Bobby Harrell, Sheriff Metts and … the Feds are here in Columbia, investigating violations.. Voters vote and people get put in jails. Curtis Loftis is next.

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Alex September 29, 2014 at 9:20 pm

Haha.
Dream on, hater, dream on.
I heard Reynolds Williams was next.

truthmonger September 29, 2014 at 1:38 pm

Actually, reading the news accounts (and being a member of the system), the “investigations” were whitewashing jobs more akin to Kevin Fisher investigating Leon Lott, or Warren Bolton looking at Mayor Benjamin….. brainless cheerleading at it’s finest.

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Smith September 29, 2014 at 2:43 pm

You are factually incorrect. RSIC is in the bottom 30% of public plans and that is a jump up from the bottom 20%, which is there usual place in the order of things.

Why would you lie about something that can be proven so easily?

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nitrat September 29, 2014 at 3:59 pm

And, similarly to Ag Commissioner Hugh Weathers making ‘home grown’ ads for IGA this campaign season, Curtis is all over the tube taking credit for the state’s college tuition savings program.

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College September 29, 2014 at 4:55 pm

I see that Curt went to NY last week. I want to hear about the Phoenix bar and Max. Hope that they had a fine time together. I wish that he would stay in NY and leave us alone…Good riddance..One less idiotic pol in SC! I sure wish.. The college tuition savings program that he is responsible for , is one of the worst performing program in the nation . He cannot be trusted…

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Hebron September 29, 2014 at 6:28 pm

College, your story reminds me of a girl named BridgettI that I used to date. She was from West Columbia and she was problematic. You see, she had an inappropriate relationship with her father, a grissley old fat ass named Sam. I think he had been pounding her since she was about 12 and it affected her in a lot of ways. She was a confirmed liar, like her dad, and she was was a zealot, in fact she was always going on about nonsense that nobody cared about. In the end, she faded into obscurity, and I think went back to banging daddy Sam. Sad story, but true.

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Wes September 29, 2014 at 8:35 pm

Yes, everyone in WC knew this story. Sam’s wife was the problem. She was a lazy as hell and ugly as hell. No wonder Sam took his little pencil dick to his daughter Bridget. A very disturbed family by the looks of things.

Oscar September 29, 2014 at 9:21 pm

Was this the same old state government hack they fought exposing himself at HHS some years back??

Crap September 30, 2014 at 1:18 am

You do not know Sam’s wife and it shows. You are a gay, homo, sick. infected man with crap. And you touch children, go to schools with your contagious crap.. Go away Curtis Loftis. What does you dick look like? I could care less and I know it is infected with a incurable crap.. Go away sicko..

Jan September 29, 2014 at 8:01 pm

I have two children in the SC Future Scholars plan and I can tell you the performance and service have been excellent. I don’t know where you get your information, but I wish you would post it because I am skeptical.

I have been an investor for many years and dollar for dollar, I could not be happier with the college savings plan.

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Letty September 29, 2014 at 8:28 pm

Curtis, you don’t have any children and never will given your propensities.

ODS September 29, 2014 at 8:59 pm

My son graduated from Clemson last year and it cost me less than $2000 because I had invested in the college savings plan. It is one of the best investments I have ever made.

Fool September 30, 2014 at 1:03 am

you are a fool .. You are Curtis Loftis

FastEddy23 September 29, 2014 at 10:12 am

Because They can?

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truthmonger September 29, 2014 at 1:32 pm

Don’t forget the ongoing fund “raiding” by government, which was conveniently overlooked in the report.

“Deferred Compensation”, or a pension, is simply money owed at a later date for work done today. It is why so many state and local jobs pay SO MUCH less than their private counterparts. It isn’t something extra, but rather part of the pay package. When pensions are cut, it is in reality a pay CUT, not simply a reduction in some nebulous benefit. Imagine a customer coming into your business, obtaining a product or service, then afterwards arbitrarily changing the price. THAT is what is being done to state and local employees every day.

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Thomas September 29, 2014 at 7:32 pm

Maybe this was true back in the day. In 2014 America, state and federal employees are the middle class. Their employment has grown by over 12% since 2008. Their salaries have grown 10-19% since 2008. Their healthcare plans are costing 26-63% more since 2008. Their pension plans evolved from giving our soldiers a lifetime salary after retirement in return for then lower wages into what economists call today the underfunded median or above wage with premium healthcare and lifetime payout of 3/4 of their salary after 20-28 years of having their snoots in the trough. Public worker defined benefit retirement plans are bankrupting cities, states, and the Federal Government. In essence, the defined benefit plans are stealing tax payer revenues for essential services. In SC, they fund the pensions, pay the healthcare costs, give public workers raises. Then they issue grants, fund pet projects, and pork spending. Of course nothing is left when unemployment is 20%, so they cut Corrections, road repairs, then they raise taxes for funding other cut services.

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Letty September 29, 2014 at 8:03 pm

Sounds like you need to go to work for the government.

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Beartrkkr September 29, 2014 at 8:34 pm

And enjoy all that fabulous pay? Maybe if you are one of the select few (with little qualifications), it might be worth it.

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well consider September 29, 2014 at 8:57 pm

TM, I can appreciate your point about govs raining the cookie jar, but to say its just delayed comepensation is inaccurrate also. Otherwise based on lifen spans, and often shorter government career times, the pay would be higher than civilian jobs. More to the point, most pensions are no longer tied to any economic, financial or realistic calculable formula. Hence why governments and unions – which don’t where to such meany weeny ideas – are the only places that still offed pensions. In reality they are unsustainable, and but for immigration the population of the us is going down, not up, so the ever expanding pyrimad of contributors to the pyramid scheme is falling apart on pensions too.

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True September 30, 2014 at 7:59 am

govs raining, comepensation, lifen, which don’t ..meany weeny ideas, offed the population of us, pyramid , .. Curtis Loftis you are very sick and from way back.. violence against women, false testimonies, impostor, a danger to the people of SC. The legislature will take care of this. You are an insult to the retirees. Honest, hard working people who deserve a voice and the pensions paid by their own money. Curtis, why are you taking a pay check from the State.? You hate the State, so go away and stop taking that pay check. Give your pay check to the retirees trust fund instead of stealing from it. Show your true colors!

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Kyle September 29, 2014 at 8:05 pm

Government pension are not the problem. Lousy management is the problem. The SC Commission is insular and has been sold every shinny new investment possible. Warren Buffet said it best…if you can’t describe the investment on the back of a napkin, don’t buy it!

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Vickie September 29, 2014 at 8:35 pm

Yes, it is indeed the lousy management and The treasurer has not been a positive force starting with the BNY and the lost of 200+ millions and millions paid to the attorneys. Why did the payments to the attorneys do not go through the state’s accounting system? Because there are no records and the transactions cannot not be seen. The treasurer is stealing from the fund and he refuses to sign a check and is costing us $18 000 a day. The average pension for retirees in SC is $19 000 a year!! He must be impeached now

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Mark September 29, 2014 at 8:57 pm

The 200 million dollars was lost by the SC Investment Commission in 2008 and 2009. The senior staffer Hershel Harper gave sworn statements saying he did not understand the investment, did not manage the investment, did not even balance the multi-million dollar account.
Loftis became treasurer in 2011, after the losses, and inherited the case from former Treasurer Converse Chellis.
Loftis has started speaking publically about this and spoke to my group recently. He brings documents, unlike the anonymous people making wild statements on the internet.
I am glad he has started talking about the losses and the negligent actions of the Commission. The truth about the Investment Commission’s failure to manage their investments is important.

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Vickie September 29, 2014 at 9:58 pm

Securities lending services were provided to the State Treasurer by the Bank of New York. The contract, consummated in 2000, gave that bank great freedom in its investment latitude but did prohibit the bank from making certain types of risky investments. The bank made some of those risky investments in violation of that contract. Some $200 million was lost because the investments bombed in 2007/2008 which resulted in a lawsuit against the bank. The Investment Commission really had nothing to do with this. It was all handled by the Treasurer. Loftis settled this suit prematurely for 12 cents on the dollar. This lost the retirement fund nearly $200 million. A cynical “Thanks”, Mr. Loftis, from a retiree. And we still don’t know why the attorneys were paid so much outside the state accounting system. Shame.

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Mark September 29, 2014 at 10:11 pm

The Treasurer’s office gave control of the Securities Lending account to the Investment Commission by letter from the then Treasurer. As has been proven by the $200,000,000 in losses, the investment Commission was not up to the task, and the retirees suffered from the negligence of the Commission. The retirees will be paying for the negligence of Reynolds Williams and Company for a long time to come.

Vickie September 29, 2014 at 10:15 pm

Lies.

Tammy September 29, 2014 at 10:17 pm

Reynolds, you know no one can lie as well as you. So don’t worry, your reputation as the best is in tact!

Mark September 29, 2014 at 10:22 pm

Curtis, I guess you are right. The only competition I have is you.

Tim September 29, 2014 at 10:26 pm

Haha,
Reynolds, you know better. You know who this is, just think a little harder.
Who is it that knows the secret of your hidden government billings? Who is it that remembers you as an awkward boy in Mullins
Reynolds, it is time for you to think hard!

Tim September 29, 2014 at 10:15 pm

$350 million dollars a year , or more, of investment commission fees are paid outside of the State accounting system. It is the single largest area of possible corruption in SC.

Vickie September 29, 2014 at 10:18 pm

Total BS. Our Investment Commission reports more on fees than any other such body in the USA. How do you tolerate continuing to get a paycheck working for government, Curtis?

Tim September 29, 2014 at 10:23 pm

“Reports?”
Hmmm, I thought we were talking about money being “in the system.”
80% of the fees paid by the Investment Commission are not in the state accounting system, and the Feds know it, thank God.
About a billion dollars of slushy, squishy retiree money, outside the accounting of the state, with simple gross reporting at the end of the year.
Negligence? Fraud? Corruption? Gosh, who knows?

JD September 29, 2014 at 9:17 pm

Attorney’s fees are typically paid from the defendant directly to the attys. The money would never go to the state so one would not expect to see records there.
The Judge’s order and settlement papers would memorialize the fees and other pertinent issues.
Vickie, I don’t know about the other issue you raise, but on the attorney’s fees you are just plain wrong.

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vickie September 29, 2014 at 9:37 pm

Curtis, this is just not correct. Attorneys fees are typically paid out of the complainant’s settlement. The original Litigation Retention Agreement approved by the Attorney General reflected this. The JUDGE’S ORDER indicated that attorney’s fees would be paid directly by each party. This was violated by the Treasurer, even before the order was sent to the court, who negotiated a payment by the Bank of NY directly to the attorneys yet reported to the court that each party paid their own attorney’s fees. Court documents don’t lie. They reflect what was reported to the court. Now just why did Loftis lie to the Court and keep these attorney payments out of the State’s accounting, monitoring and reporting systems? Could it be that he profited from this unusual arrangement? Most likely. Politicians like Loftis are corrupt. They create their own reality and try to convince the rest of us fools to believe it. I, for one, don’t. The official record shows I am right.

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JJ September 29, 2014 at 10:16 pm

Reynolds, you are slipping. You can do better.

Vickie September 29, 2014 at 10:25 pm

Tell me what is in error in the previous post. You are a fool, Curtis and it is becoming quite apparent.

Tim September 29, 2014 at 10:30 pm

Reynolds, Reynolds, who is it that knows about your failed attempt to hijack a bank? Who is it that knows about your indefensible actions harming your partners in a certain grocery store investment? Who is it that knows about a certain bank in Charleston that you have a “behind the back” interest in?
Reynolds, it is time for the roosters to come home. Reynolds, Reynolds, Reynolds.

Vickie September 29, 2014 at 10:46 pm

Apparently you cannot answer the questions I raise in my previous post. Your response is to use fictitious names to try to question my own integrity. You are a fool Curtis Loftis. It’s easy to see.

Larry September 29, 2014 at 8:12 pm

SC Govt pensions are the biggest liability of our state.

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Sharon September 29, 2014 at 9:22 pm

And for many states. They must be tames of done away with.

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Max September 29, 2014 at 10:31 pm

Time to hang this up. It is going nowhere. I suggest we all relax and enjoy ourselves. I am looking forward to welcoming Curt back in NY again where we can kick back and leave this madness. Enjoyed the recent time together and look forward to the reunion at the Phoenix Bar.

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Tim September 29, 2014 at 10:34 pm

Reynolds, Reynolds, maybe you should tell us what goes on at your “friend’s” house in Morehead City, Not the house you own (bought under the most dubious of circumstances), but the other house you visit? Visit regularly.
You tell, or I will.

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Max September 29, 2014 at 10:39 pm

Curt, what do you mean? I was referring to our time last week in NY. I still remember that last night. Who is Reynolds? I just do not understand…You make me jealous and I feel betrayed!

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Tim September 29, 2014 at 11:24 pm

Good night Reynolds. I don’t know where Curt was last week but I know you were probably counting the money you have made off the state retirement fund. Counting all that money must take lots of time.
PS Should I give the tail number of that jet from New York that picks you up at the Florence airport on a regular basis?

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Max September 29, 2014 at 11:53 pm

We had a great time . You need to come back. Was this you in the pic? We look cute, together .. Don’t be long. Come back soon. Curt was with me. LOL…

Eric September 29, 2014 at 10:39 pm

Curtis Loftis has had great success in cleaning up this crap pool of a Commission. I read a list of the changes made in the last 3 years, Scores of them. Each change needed and past due. Good job Mr Treasurer.

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bed September 29, 2014 at 11:30 pm

Eric, go to bed.. you = Loftis made crap, a lot of it . no success, no nothing. Mr.Treasurer is a very sick man and must be impeached. You are a fool Curtis Loftis and a dangerous one. Sick, infected, violent and incompetent. How can Loftis be any help and have positive actions for the trust fund. It is our money , we paid for it We work for it and paid for it . It is our money and we do not like that Curtis Loftis is wasting and abusing it and giving it to the Bank of NY. and his attorneys and to a man he is associated with and gone on vacation with and is costing our fund $18 000 a day. ! Please, Curtis, respond to this. I am sick of it. $18 000 a day.

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Janice September 30, 2014 at 6:10 am

Keep it up Mr. Loftis. Don’t let the liars and swindlers get you down. The 2 or 3 anonymous posters represent the worst of SC and their criminal activity is known to the voters and that is why you won your election in June.

Lars lie. That is what they do. Mr. Loftis, if you read this, please understand the people are behind you!

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Lars September 30, 2014 at 8:36 am

Lars, what is that?

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