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You are unbelievably pedantic. You disagree with your opening statement then agree that I’m right!

• lotsofpulp 5y ago
  I disagree in classifying it as a legal mandate, because that makes it seem like there is some type of law forcing pension fund boards to invest in risky assets. I am not aware of any state law that says the pension fund has to use excessively high return on investment assumptions. State law might say that taxpayers have to prioritize defined benefit pension benefits in the event the pension fund run out. Ironically, the only law about return on investment assumptions is on non taxpayer funded pension plans via ERISA and PPA 2006. I cannot help but think the only reason taxpayer funded pensions have different rules is so future taxpayers can be fleeced. The distinction is important, because the reason the pension fund boards invest in risky assets is not due to the law (aka legal mandate), but rather today’s taxpayers wanting to push today’s labor costs onto future taxpayers while not stating it on official reports so that the responsible actors can maintain plausible deniability.