Part of the blame lies with GASB (Governmental Accounting Standards Board). Prior to around 2006, GASB allowed governments to avoid reporting pension liabiliti

Part of the blame lies with GASB (Governmental Accounting Standards Board). Prior to around 2006, GASB allowed governments to avoid reporting pension liabilities on the balance sheet. Instead, pension liabilities were reported in the footnotes. From 2006 onward, GASB started to tighten-up requirements, and eventually brought governmental accounting in-line with private sector accounting (aka liabilities are reported in full). Once the new regs took effect...news reports about cities declaring bankruptcy started increasing.