There is, justifiably, a lot of concern about 'the pension problem' state and local governments are facing. While broad concern is appropriate (many funds are in trouble and it's taking an increasingly large share of public finances to resolve those troubles), there are also many funds that are in fine shape.
So, I think it's important as we talk about 'the pension problem' in broad policy terms (versus talking about the challenges a particular fund may face) to start with a shared set of facts and understandings - like the fact there are 5,500 pension plans around the U.S., with 21 million members, and those plans are collectively underfunded by $1-$4 TRILLION.
OK, now we understand clearly the scope of the public policy challenge - see more facts and overview info in this article.
State and local pensions have attracted considerable attention in recent years. Inadequate contributions have left pension plans underfunded by at least $1 trillion and possibly by as much as $3 to $4 trillion depending on modeling assumptions.