In its latest siren concerning public pension plans ("Beware the next federal bailout," Aug. 22), the Maryland Public Policy Institute (MPPI) relies on confusion and unjustified fear when it asks if there is another federal bailout coming. There is a simple answer: No.
To support his conjecture, MPPI president Christopher Summers states that Maryland "does not have the money to pay for 60 percent of its actual pension liabilities." Again, wrong, as Mr. Summers calculates these liabilities using economic assumptions and financial theory that comport with neither historical experience nor recognized accounting standards. The state pension system is actually 65 percent funded. Although this funding level is not as strong as it should be, reforms enacted in 2011 will strengthen that funded ratio over the coming years.