[lostoptimist]

And how is bankruptcy going to prevent this from occurring again? Will future politicians still have the ability to grant crazy pensions knowing their term won't endure its negative effects? Not sure what the solution is but I don't think bankruptcy will solve it.

[rayiner]

1) Those lofty retirement guarantees were much easier to bargain for before everyone realized that the days of heady growth in America were done.

2) The bankruptcies will dramatically weaken the public sector unions.

[fnordfnordfnord]

LOL, what public sector unions?

[mh-]

In 2009 the U.S. membership of public sector unions surpassed membership of private sector unions for the first time, at 7.9m and 7.4m respectively.

http://en.wikipedia.org/wiki/Public-sector_trade_union#cite_...

http://www.nationalaffairs.com/publications/detail/the-troub...

[fnordfnordfnord]

From your second link "dramatic decline in overall union membership." which is what I meant to imply. Unions are fairly impotent today.

[rayiner]

Unions in general are impotent, but the public unions (teachers, police, etc) are among the only ones that still have a lot of leverage.

[bitwize]

Public-sector unions are the only unions left in the U.S. with much political zorch, more's the pity.

[thatswrong0]

Why should unions have any political zorch? Why must collective bargaining require any amount of state intervention (besides, obviously, protecting individual liberty and property)?

[prostoalex]

I think the pattern has been established in cities which avoided bankruptcy, like San Jose - you hire a barebone skeleton of public employees, re-negotiate the contracts in light of macroeconomic conditions, and subcontract everything else - those employees are now eligible for 401k or IRA or other more exciting things.