In the 1950s, American motorists went from getting their kicks on Route 66 to a faster way to see the USA: The Eisenhower-era freeway system was just what millions of freedom-loving car drivers craved. Who would have guessed then that Motown would eventually go broke? But, as we know, Detroit just recently filed for bankruptcy.
Which big American city is in line to be the next Detroit? An alarming number of cities face huge underfunded pension obligations and budget shortfalls.
Pension liabilities can affect cities much younger than Detroit. Who would have guessed that the home city of the technology explosion would now be facing huge financial problems?
Yes, add San Jose,Calif., along with several other California cities, to the list of municipalities with major pension liabilities:
The City of San Jose -- aka Silicon Valley -- has been in court trying to find ways to cut its public-sector pension plan costs. One of the ways proposed was to cut retirement benefits for current workers. ... San Jose has had budget deficits of $670 million over the last decade and saw its retirement costs balloon from $73 million to $245 million.
The major cities listed in this article just scratch the surface of the total number of American municipalities that are grappling with major budget shortfalls.