New Jersey is the Canary in the Financial Mineshaft

This morning on the Corus radio stations, Michael Campbell spoke at length (beginning at 34:00) about this story. Here's a key segment:

Eileen Norcross, a George Mason University researcher who issued a report on the New Jersey pension system last month, is succinct: "It's mathematically impossible to pay this out. It's too large."

How New Jersey arrived at this moment in time is not a mystery. The decisions by governors, state legislators and union leaders have been chronicled by newspapers and in policy reports for two decades.

Experts and leaders by and large agree on what happened and why. In short, politicians looking to win elections, or just balance the state budget, either promised richer benefits or failed to find a way to make the necessary contributions each year for the benefits that would someday come due.

New Jersey may very well be the first to raise the white flag but it certainly won't be the last. California and New York seem to be in the same boat. Perhaps every U.S. state is? And I suspect that more than a few Canadian provinces are as well. So is the same with every country in Europe.

One thing is for sure: The coming decade will be an "interesting one" to say the least!