e.j. mcmahon, has written about extensively taxpayers expense, and is often a sophisticated scheme which amongothers, is e.j. here, e.j. mcmahon, has written about extensively. pension funds, public pension funds assume an unrealistic 8% annual investment return which make about that. bernie madoff on a claim he was getting 12% a year. we knew he was cheating. [laughter] no profit passionate private pension fund can get way with these kind of rosy projections that, in fact, kosatka singh is this unrealistic 8% return last year, that when the montana board a year ago was looking for a new actuarial firm to work for it's fun, the board said in his request for proposal that no firm which believe the public pensions should adhere to a lower board realistic average annual investment return should even bother applying for the job. realism, in other words, will get you nowhere in the world of public sector pensions. the combination of rich benefits and rising salaries has given state and local workers a big compensation premium over private workers which is a huge reversal from 30 to 40 years ago. se