[dredmorbius]

As with many companies, municipalities and states incurred liabilities for contractual promises whilt not fully funding them, kicking the can down the road.

What typically happens is that either national government baols out the fund, retirees get squeezed, or both. The true beneficiaries are past taxpayers who benefitted from government service delivery based on promised pension benefits to employees, but who skipped on paying the bill at the time.

Oddly, you hear far less about private sector failures in this regard. In part because defined-benefit plans are largely extinct, but the abysmal failure of individualised defined-contribution (401k / IRA) programmes is just the same problem undrr a different flag. But private sector has been dodging this far more than public.

There's more to this, yes. Some of it is government corruption and graft. Mancur Olsen's "The Logic of Collective Action', describing both pensioners' and taxpayers' (mostly a small group of highly-motivated wealthy) very self-interested lobbying to maximise commitments whilst skirting payments is far more instructive.