Phoenix drowning in pension debt, drastic response proposed

Phoenix is facing a huge pension crisis and drastic measures are being considered to deal with it. One lawmaker wants the city to stop spending any money until it gets its pension debt under control.

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“The debt in Phoenix right now is about $4.4 billion of unfunded pension debt,” Phoenix City Councilman Sal DiCiccio told FOX Business’ Stuart Varney on Tuesday. “If you look at what’s happening in Washington, D.C. ... that place can print money, we can’t. We have to live within our means and more importantly we also have to pay the obligation from these pensions.”

The United States currently has more than $200 trillion in unfunded pension debt, and DiCiccio says, “There’s no real plan to pay for it.”

That is why he teamed with former Utah Republican Rep. Jason Chaffetz on a model that they think will also get the national debt under control.

The plan entails diverting funding toward pensions and away from services, including some city-funded after-school programs and street repairs, but excludes critical functions of government, such as police and fire.

“If we don’t take this under control now and take it under control quickly," he said, "cities across the country are going to become nothing more than pension-eating machines and the services are going to be gone.”

DiCiccio added that the measure would be in place until pensions are 90 percent funded.