"Desperate public officials often see public pension funds as an almost irresistible pool of money, borrow from these pensions and neglect topping them up. The compounded effect of such actions has led to massive pension shortfalls.... [B]efore you condemn this as yet another example of public profligacy, ... things aren't better in the private sector. The WSJ reports that S&P 500 companies posted a record level of underfunding for pensions and other post-employment benefits in 2011. Defined pensions were underfunded by $354.7 billion in 2011, an increase of over $100 billion from the end of 2010. During the good years, companies used investment gains from their pension plans to pad their earnings and outright steal from pensions, but now that option has vanished. With interest rates hitting record lows, pensions have become a liability, prompting companies to cut them or offload the risk to insurance companies."

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