California = Greece

I've previously observed that the risk of sovereign default in some states -- California included -- resembles Greece, which is effectively insolvent. One reason why Greece and other Euro-zone countries are troubled is unrealistically low retirement ages. So I shouldn't have been surprised by this recent story from the Associated Press:

The next generation of University of California employees could have to work longer to receive pensions and other retirement benefits.

The UC Board of Regents on Monday approved a contentious plan that raises the retirement age for future university employees and requires retirees to pay more for their health care benefits.

Many of the changes must still be negotiated with the university's 28 employee unions, which have been critical of the reforms.

University officials said the changes are needed to address an estimated $21 billion unfunded liability in its retiree health and pension programs.

With no action, the ballooning costs of those benefits could threaten the university's ability to educate students and conduct research, officials said. . .

The plan would increase the minimum retirement age for employees hired on or after July 1, 2013 from 50 to 55. It also raises the age to receive maximum pension benefits from 60 to 65.

The retirement age would not change for current employees, but they will have to contribute more of their paychecks toward their pensions under a plan approved by the regents in September.

California's gone from bad to beyond repair.

(via Maggie's Farm)