Ronald Ryan, CEO and Founder, Ryan ALM, Inc.
The COVID-19 has brought wide-spread consequences in America’s economy.
Ron Ryan will examine a list of economic effects and how it played a role in U.S. pensions’ funded status. At the time when funds are in most demand, they are in shortest supply.
Revenues currently available to fund public pension plans are deficient. There are massive shortfalls in tax revenues due to bankruptcies and partially operating businesses, i.e., retail stores, restaurants, hotels, tourist attractions, etc. Shortfalls have also occurred in government operations, i.e., delinquent property taxes, reduced toll traffic on roads, bridges and tunnels, and reduced fare receipts from ridership on public transportation.
Revenues to fund private pension plans are similarly deficient, forcing companies in certain industries to limit their contributions, e.g., airlines, retail stores, restaurant chains, and real estate.
In addition, the costs associated with COVID-19 have escalated. For example, stimulus payments for unemployment insurance, vaccine development, sheltering an increasing number of homeless, and feeding the needy. The costs of policing major cities also increased with rising crime, property destruction, and social unrest.
The challenge before us is to reform and restructure the U.S. pension system before it can harm future generations. Not only will we examine the economic effects of the Pandemic on U.S. pensions’ funded status, but to offer a path to solve the problem.