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TCTI: Too Crazy To Ignore

Dave Ross

Can retirement money just vanish?

As they've learned in Detroit, despite this idea that a pension is a guarantee, it turns out to be like any other promise. It's only as good as the organization that backs it. (AP Photo/Paul Sancya, File)

It was the latest humiliation for the city of Detroit.

"A shocker in the courtroom! The Michigan constitution does not protect pensions," exclaimed WWJ's Charlie Langton after a judge ruled that the City of Detroit, $18 billion in debt, can go into bankruptcy.

Which means the pensions and health plans of former city employees could be cut to pay Detroit's bills.

That's bad news for former workers like David Sole, "We think taking a dime or a dollar is too much. The banks are considered secure creditors - were garbage."

And it's bad news for David Allen, a firefighter who was injured when a building collapsed on him, "I feel betrayed. I feel short-changed, I feel angry."

Angry - because he and other Detroit retirees could see their pension checks cut by 84 percent from what they expected to get.

It's down to a choice between paying the people who used to work for the city, or paying the people the city needs now.

How bad is it? "The short-handed police take 58 minutes on average to respond to a call for help here, and 40 percent of the street lights are out," reports CBS Correspondent Dean Reynolds.

And the message to Detroit's 20,000 retirees - and to present and future retirees anywhere - is pretty simple: despite this idea that a pension is a guarantee, it turns out to be like any other promise. It's only as good as the organization that backs it.

Dave Ross on KIRO Radio 97.3 FM

Tune in to KIRO Radio weekdays at 5am for Dave Ross on Seattle's Morning News.

Dave Ross on KIRO Radio 97.3 FM

  • Dave Ross on KIRO Radio 97.3 FMTune in to KIRO Radio weekdays at 5am for Dave Ross on Seattle's Morning News.

About the Author


Dave Ross hosts the Morning News on KIRO Radio weekdays from 5-9 a.m. Dave has won the national Edward R. Murrow Award for writing five times since he started at KIRO Radio in 1978.

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