State Plan Makes Fund Both Borrower and Lender

Whose not using sleight-of-hand techniques in order forgo making difficult choices? Difficult choices cannot be postponed forever. Eventually, the can reaches the end of the road and it must be picked up. This is the reason why gold remains in a secular bull market.

Gov. David A. Paterson and legislative leaders have tentatively agreed to allow the state and municipalities to borrow nearly $6 billion to help them make their required annual payments to the state pension fund.

And, in classic budgetary sleight-of-hand, they will borrow the money to make the payments to the pension fund — from the same pension fund.

As word of the plan spread, some denounced it as a shell game and a blatant effort by state leaders to avoid making difficult decisions, like cutting government spending or reducing pension benefits.

Source: nytimes.com