It relied on data provided by the states. WTF

The state has reported that its unfunded liability was $75.7 billion at the close of fiscal 2010, which ended June 30. That compares with $62.4 billion in the 2009 data used by Moody's.

Moody's acknowledged that pension liability levels also may be understated in its report because it relied on data provided by the states. The accounting rules governing states allow for more flexibility and variation than do the rules governing corporate disclosures.

"Moody's is still quite far away from facing the true unfunded liability," said Joshua Rauh, an associate professor of finance at Northwestern University's Kellogg School of Management.

When state pension funds project how much they will owe retirees, or their liability, they convert the sum into today's dollars, figuring those dollars will be invested and provide annualized returns in line with the fund's stated investment goals, most of which range between 7 and 8 percent.

Rauh believes the state should peg its plan, instead, to the lower returns provided by less risky investments, such as those provided by Treasury bonds. "Illinois' unfunded liability is more like $200 billion," he said.

But not to worry, the Dems and Governor Quinnocchio are on the case. WTF hits the fan in Illinois.

...And the country. IBD:

Entitlements: The Congressional Budget Office says Social Security will begin running deficits this year and every year until it is drained in 2037. The baby boomers who used to pull the wagon are starting to ride it.