If the Post makes a profit this year, it won’t be because of stories like these.  And yet the Post’s and other papers’ detailed and up-to-the minute reporting will have profound long term effects.  This kind of journalism drives the Sunday talk show narratives, shapes first comments from every congressperson who gets in front of a microphone, and forms initial public opinion.  More important, this kind of reporting shapes the trajectory of government actions from day one — and in an organization the size of the U.S. government, first steps really count. Officials from TSA, the FAA, and from FBI, CIA, and many other agencies will be influenced by reporting from the Post and other national news sources even as they work with information the public may never know.

Approaching the end of a tumultuous year, we can be thankful for the contribution to national security made by professional journalists who, consistently and accurately, help us understand the way world works — and help citizens judge how well our government reacts to threats like the one on American Airlines 253.

Ned Hodgman

Cho writes that state pension funds and OPEBs (Other Post-Employment Benefits) have lost “about $1 trillion” in the worth of their investments, which means that “within 15 years, public systems on average will have less than half the money they need to pay pension benefits.”  Whoops!  This means that police, paramedics, firefighters, teachers, health workers, and a host of other government employees may face major reductions in their pensions, especially as the elderly population grows. 

The problems are so widespread that they could lead to paralysis.  First there is the standard 8% return on investments that public pension funds use to calculate the amount of money they are earning — whether or not they actually make 8% in a given year.  Then there are the risky investment vehicles (surprise!) that pension funds dove into; after all, everyone else was doing it….  And with these losses, Cho writes that state pension managers are actually looking again to riskier investments in the hopes of covering their past losses.

Some pension funds are predicting that it will take more than forty years of good returns for them to restore their balances to previous levels.  Generally speaking, preventive journalism should include proposed solutions, which Cho doesn’t try to do.  The question is whether any are actually out there.

Duhigg visits Hatfield’s Ferry, PA, where residents were overjoyed to have their air finally clean — until they found out that coal plant wastewater can contain “high concentrations of dissolved arsenic, barium, boron, iron, manganese, cadmium, magnesium and other heavy metals that have been shown to contribute to cancer, organ failures, and other diseases.”  And even when landfills are used, the chemicals can leach into groundwater.  Duhigg writes that “EPA officials [have] said that toughening pollution rules for power plants was among their top priorities.”

The people in Hatfield’s Ferry may not have long to wait, but then again, time is working against them.

as plausible and unnerving by some scientists like William Joy, co-founder of Sun Microsystems. Other technologists, notably Raymond Kurzweil, have extolled the coming of ultrasmart machines, saying they will offer huge advances in life extension and wealth creation.

If the guy from Sun Microsystems is worried, then I’m worried.  And scientists getting in front of this process is essential, because the sooner we are all informed about the choices we face, the sooner we can understand how easy it would be for criminals, corporations, or even governments to develop these tools for use against us.  If you think I’m being paranoid, note that the conference organizer said

the panel was looking for ways to guide research so that technology improved society rather than moved it toward a technological catastrophe. Some research might, for instance, be conducted in a high-security laboratory.

High-security laboratory for building potentially dangerous robots? Coming soon (but not just to a movie theater) near you. -NH

The reporters tell the unfortunate citizens of Florida a story that should make people all over the country pick up the phone and start calling their state pension fund administrators.  It turns out it’s pretty easy to hide the loss of hundreds of millions of dollars — as long as you "[cloud] . . . public statements in complicated language and corporate speak that obscures the truth" or provide answers "that [are] technically correct but [give] a distorted picture." 

In Florida, the State Board of Administration (SBA), which includes Governor Charlie Crist as a trustee, has lost money due to investments in collateralized debt obligations and other risky vehicles.  Actually, pension funds across the country have been hit hard.   But Florida’s pension fund managers appear to be standouts for misinforming and stonewalling worried citizens and local government officials from around the state who called in to find out where their money was after credit markets began to crumble.  Jefferson County, for example, had invested with the Florida SBA and then found it could not meet an $850,000 payroll because, as an SBA representative told the county, "the board took control out of our hands, so there is really nothing I can do." 

The city of Stuart was a bit more fortunate, removing their $26 million from SBA control one day before their investment pool was frozen and withdrawals were blocked.  Their administrator, Dorothy Zaharatko, had been calling the SBA "for two weeks" but "no satisfactory response was forthcoming."  Those with money still invested were stuck when Governor Crist moved to freeze the Local Government Investment Pool.

This problem is widespread and requires both citizen and government action before it’s too late.  Understanding Government will continue to track this issue and would appreciate hearing from readers who have encountered similar problems around the country. -NH