the question is, it's underfunded, so how much adjustment does there have to be? we don't really know, because there'll be a lot of debate over what is the level of underfunding. - do you think by any chance that this chapter 9 filing was brought on because it would go after these pensions? do you think there's something going on here? - actually, even a bigger part of the problem, arguably, is the retirement healthcare benefits, which are actually estimated to be almost twice as large as the pension problem. there's really no doubt that both employees and retirees are really the city's main creditors, and a lot of this bankruptcy is going to revolve around who gets how much money out of this. - why is this case so critical to the rest of the nation? - many cities right now, for a variety of different reasons, have underfunded pension systems, and as i said, even more importantly, have really provided almost no funding for their retiree healthcare benefits. so cities like chicago face many of these same problems. so people are wondering, given michigan's constitut

you look at some of the unfunded -- underfunded pensions, to the just in the city with say the cools, but the state which is phenom nalley unfunded its obligations, you are saying how is this going to paid off if you don't act now? it's only going to get worse. >> there's a couple of waysing right? love your first line, you can't outrun math and when you go into the numbers, everybody is looking for an enemy because the numbers are so big and complex. have you to almost mentally reduce it to like a movie. protagonist, good buy, bad guy, right? so people are trying to find the problem. the problem is everywhere. >> yeah. and you've got to pick what you can solve. pittsburgh is a pretty good example in the sense, that you know, the mayor came in, luke ravenstahl, and he cut 25% of spending, and, you know, i'm not saying that's a solution for everyone, but you do need a certain amount of discipline in how you look at these numbers >> if you go through big cities the last numbers i've got, chicago's pension was 52%%, 50 cents on if the dollar funded, the lowest of any major city in the un

even before sequestration the system was underfunded, with cases turned down by attorneys already underfunded, president of the national legal aid and defender association, has seen the fallout from these cutbacks and joins us to talk about the impact sequestration is having on our legal system. good to have you here. >> nice to be here. tavis: this is a major moment in , state, where states courts are required to make sure that the indigent and the poor make -- have the resources to be represented in court. take me back 50 years ago and help me understand what the conditions were, what was happening that forced this into play. >> so 50 years ago was when the supreme court decided the landmark case of gideon versus wainwright. mr. gideon was an individual who was brought to court without a lawyer when he asked for a lawyer and said he could not pay for one area the court did not give him one. from his jail cell, he wrote a petition to the u.s. supreme court and ultimately the court said that in this country if a person is brought into court and has to face the state, the resources of the stat

you might be that a little bit but 100 billion in underfunded liabilities?s are 38% of its budget. i used to live in detroit. the metro area, anyway. it's a disaster. you're right. going forward, this is not something that you can clean up in the next couple of years. each one of these cities, it's not just, you know, like we said detroit or stockton, california. it's coming to more and more. who is going to invest in those cities? how do you bring more money in? whether it's manufacturing, retail -- >> everybody hates the bond market until they need money, right? you hear people -- especially on the left side say, the bond market. they bash it. what did james carville say? you need them. i tell you what, here's a note to america. if you don't care, don't borrow money. if you don't want to be subjected to interest rates, the bond market, and the fed, don't borrow anything. >> first of all -- >> live off the financial grid. >> municipalities and states love the bond market. they do not hate the bond market. >> people do. >> i don't know who the people are. >>

-- a underfunded by 1. $4 trillion.s to try not likely to be bailed out? because once that starts, there will be the unending line of mayors with there hands out. chicagos credit rating was downgraded because it has $90 billion of unfunded pension liabilities of its own and they are in desperate trouble. los angeles faces $30 billion of liabilities in california is a big state and some municipalities have already gone bankrupt and so it goes. all over the country liabilities, the deficits, falling population , and a disaster born out of politicians you just wanted to get reelected and they agreed to the union terms on just about everything for that support. but that deal is so over. >> detroit goes belly up a and the shrinking population and the awful leadership leaving retirees and creditors and nervous. former congress mancuso niche taste those challenges when he was mayor of cleveland. how it can fight its way out. ♪ ♪ ♪ ♪ [ male announcer ] if y can't stand the heat, get off the st track. gethe mercedes-bz you've be

broader issue that we just in many different ways, including around development, we persistently underfund transit and a disfunctionality in the city. i'm hoping over time we can correct for the sake of the future of the city. ~ dysfunctionality you know, i am -- i have been hearing about this potential ballot measure and i think i understand what it's about and i think as i indicate [speaker not understood] this morning i think a ballot measure is extreme and is horrific public policy. i also hope that over the next week there will be some discussions. and if there can be a compromise of some sort that folks can live with, that maybe no one is thrilled with, but everyone can live with, that would result in peace in the world, that would be great and i would encourage both sides to talk over the next eight days. i do think it makes sense to keep it in committee for a week and then i will commit to all side that i will again as a committee report next monday so that it would still be able to come out to be heard at the board on the exact same day, i.e., a week from tomorrow. and i can keep

i mean this guy is dropping science like an underfunded school district. but yeezy's latest work of yeenius isn't music, folks. it's fashion. yeemmy? >> can yeah has a new baby, new album and new clothes. the fashion forward rapper has collaborated with french brand a.p.c. for a capsule collection. the a.p.c. can yeah collection consists of a jean, a hoodie and a t-shirt >> stephen: that's right. kanye west has a clothing line but not shoes and handbags. he leaves that to his sister, nine. it's all great. but my favorite has got to be this $120 white t-shirt made of 100% cotton with ribbing at the neckline and short sleeves. of course you wouldn't want to get any pit stains on something this pricey so be sure to wear an undershirt. now, folks, this may look like a plain white t-shirt but it's not, as evidenced by its name "the hip hop t-shirt." i believe the shirt is a collaboration by fruit, featuring "the loom." now before you go out to buy it, the hip hop t-shirt has sold out. but if you want to buy your own piece of hip-hop street cred, you're in luck.

and wret we are underfunding these programs so significantly. . i'm concerned about the proposed reduction in community development block grant funding. this bill cuts cdbg formula grants by nearly 50% and funds this program at its lowest level since its creation in the 1970's. now, in april i joined with 143 bipartisan members on a programatic request letter in support of $3.3 billion for this program. in july after the subcommittee's legislation was released, 101 bipartisan members wrote to the appropriations committee again expressing support for effective funding levels. there is demonstrated bipartisan support for community development block grants, mr. speaker, because in dollars are working each of our communities in each of our districts. governor patrick of massachusetts announced that 38 communities in massachusetts will receive over $31 million in cdbg funding. fund housing will rehabilitation, childcare centers, cityscape improvement just to name a few. i also want to point out that every $1 in every community development block grants

key elements of the debt is the dramatic underfunding of the city employee pension.so while negotiations with representatives of these pension funds and with representatives of the unions to bargain down that debt were going poorly. you had some of these representatives trying to restrain the city from filing bankruptcy. the emergency manager was forced to rush this paperwork in and get it into the courthouse which did he this afternoon the real dispute unfunded portion of the liability. until they are funded those benefits continue. comes downtown funded portion and for detroit contribution, cases of mismanagement that went on for a long period of time with respect to pension liabilities in detroit. >> now the city waits to see if a federal judge will accept the chapter 9 filing. meantime, a stay get issued against any lawsuits against the city. harris? >> boy, i will tell you, this is stuff if they are trying to retire those city employees those that happen to have a job. does this mean they won't get their pensions? >> no. the pensions still have value, but the am

the thing i worry about is with this large amount of underfunding that exists that we're in a situationhat states are particularly localities can get out of this large pension issue by declaring bankruptcy, we may see more bankruptcies. it really will be. >> it appears that they're online with you then it really changes the nature of being able to -- >> assess how you go in. >> how do you assess? >> how do you pay for money if you are raising mo in? you think you are on the queue with the pensions. >> right. i think that will be worked out in the next two or three years in the courts in michigan. >> and the lawyers. >> and the lawyers will do very well. they always dos. >> and accountants as well. >> you are talking now about state constitution, right? >> yes. >> you are talkinging about federal bankruptcy courts. the issues are who has supremacy here. this is not just about detroit, obviously, which is in the news right now, but there are other cities and states watching very, very closely, a lot of the municipal workers are careful at what's happening with the detroit bankruptcy. >> t

biological science is drastically underfunded. we've trained a workforce that is quite marvelous. we've become the world leader in science, certainly in biological science. we will behind and we will not take advantage of these extraordinary gifted people we brought along. >> the nih this year took a 5% cut there is a 20% increase in china, india, 6% in germany and the u.k. everybody else has recognized this. they're investing in this area. we are-- we are -- >> so let's assume this thing takes off an does all that we know it can if it works as we hope it will. what do you hope it does? for you? i mean personalize it and give me in a sense a final thought as to what it ought to answer for you because you've devoted your life to what you have. >> yeah, to me it's straightforward. i came into this field initially as a psychiatrist and became a neuroscientist. i believe deeply that the disorders of the mind can be understood as brain disorders. that's one way to approach it. >> as biology. >> as biology. >> and circuitry. >> so understanding them as circuit problems in the human brai

a canary in a mine shaft and probably one of the worst examples in terms of the extent of the underfunding that exists. but it is a major problem we're going to have to deal with as a country. i would just say finally that i would also disagree with him. i think detroit unfortunately had to file for bankruptcy. i don't think it had a choice. i've been through this with general motors and ford. you reach a pint where your liabilities are so vast you really have no choice. that's the position detroit sadly is in. >> suarez: steven ratner and steven kreisberg, gentlemen, thank you both. >> woodruff: and to the bloodshed in iraq. in a show of force, militants overnight attacked two prisons, killing at least 25 iraqi security troops and releasing hundreds of inmates. all that as a wave of sectarian violence continues to grow. the attacks came late sunday at the taji and abu ghraib prisons outside baghdad. >> the attack against the jail alien was carried out by nine suicide bombers and three car bombs driven by suicide bombers. the attackers lobbed more than 100 mortar shells. they also used sco

of nuances from the health care ordinance will tax an overloaded and overutilized and sometimes underfunded and understaffed department. i'm concerned ed wait times will increase, as they provide access to preventive services sufns immunizations and health screening, i'm concerned without these sss, clientele may not seek care until they have a crisis in their life. it is unclear to me how mandating an uninsured person to purchase health care [inaudible] those less fortunate are not limit today the marginalized and people who have become a casualty, these people will not be able to afford the co-payment and is deductibles from the new insurance exchange. the loss of healthy san francisco would be a great disservice to the participants utilizing it, as the name imply, healthy san francisco promotes good health, all san franciscans have a right to affordable health care, let us maintain a healthy san francisco by not eliminating this program and by keeping the employee spending requirement by protecting the health care security ordinance. thank you. >> thank you very much, next speaker. >> go

underfunding is not possible. life insurance industry pays the pensions and bears all of the investment risk. unlike current public pension plans, the safe retirement plan will be protected by a robust and multifaceted state insurance regulatory system built to ensure financial strength and solve enzi and backed up by a state law-based consumer safety net. rather than impairing their pension plans states that adopt the safe retirement plan will be upgrading their pension plans. remember, there is no pension benefit guarantee corporation backing up state and local pension plans and there never will be. corporations that sponsor pension plans pay premiums to the pbgc and their workers and retirees receive a level of insurance in the event the plan does not have assets sufficient to pay promised benefits. state and local workers enjoy no such protection. so another solution is needed. the safe retirement plan in my opinion is the answer. it is supported by well-regulated, highly solvent state insurance system and has

among the reasons, extremely underfunded pension plans and the political barriers to pension reform. >> what chicago gets from detroit is the opportunity to see what happens when you don't address the problems when you still have a chance. >> reporter: something that leaders in states and cities across the nation will likely look at very closely. john yang, nbc news, chicago. >>> and still ahead for us on this monday night, a rather stunning new look at what's become our economic reality. where you live in america goes a long way in determining just how far you may go in life. >>> and later, the legacy and lessons of a young mother who raised her children in front of the world, including a future king of england. >>> as we mentioned, fascinating new research out tonight about america's new socioeconomic reality. where you live may determine a whole lot about your life going forward. specifically, your ability to be upwardly mobile and pursue that american ideal of earning more than your parents did. our report tonight from nbc's mike taibbi. >> reporter: atlanta is one of the country

the report out today shows a record amount of underfunded pensions for the 2012 fiscal year at s&p 500 firms. data shows a combined short fall of more than $450 billion, that's nearly $100 billion less than a year ago despite mass sir gains in the stock market. >>> a staggering 1.2 trillion in corporate profits from america's biggest companies being held in offshore accounts to avoid taxes. a study from the watchdog research group that analyzes regulatory filings of the top 100 publicly traded companies found 82 of them have subsid yardries in shelters like hong kong. topping the list general electric, apple, microsoft. >>> with all that money parked overseas, it looks like investors are putting more money into bond funds. a new report from the investment company institute shows that last week more than 4 billion flowed into long-term taxable bond funds, the first time in at least a month investors put money into taxable fixed vehicles. in the same period, more than $2 billion was pulled out of municipal bond funds. when you think of banks you think of the giants, jp morgan, wells farg

pension funds in the motor city reportedly are underfunded in an estimated range of $700 million to $3.5bloomberg news reports part of the losses are from bad bets on real estate. city officials convinced the fund managers to invest in housing developments in florida and texas that went belly-up during the housing crisis. the wall street journal reports detroit's attorney general, who defended the bankrupcty process, now plans to represent the reitrees in court. just outside of detroit, the world war ii bomber factory made famous by "rosie the riveter" is in jeopardy. here by skype is michael montgomery, who's behind the effort to save a section of that plant. good morning to you, and why is it critical to save the willow run factory and the story of rose monroe? - willow run is a critical part of our history. it really was one of the major sites of the world war ii arsenal of democracy. people from all over the country, men and women of all races, came together to build the aircraft, to build the other supplies necessary to win world war ii. but more importantly, this was an integrated

pensions for public retirees are underfunded by $640 million. and now there are questions about whether assets, like works at the detroit institute of art might be sold to pay off more than 100,000 creditors. >> everybody is living in fear right now of what's going to happen. fear of the uncertainty. >> reporter: that will be up to a federal bankruptcy judge in an unprecedented case that will be watched by cities across the country dealing with their own pension problems. detroit is just the 62nd chapter 9 filing since 1954. experts warn many more could be on the way. >> this is one of the major economic crises that we'll be facing over the next decade. >> reporter: but in detroit, some view this as a fresh start. they point out that the unemployment rate has dropped substantially from its peak of 27.8% four years ago to 16.3% today. >> detroit will pull this off. i have no doubt in my mind we'll pull this off. >> reporter: for retired ambulance driver glen hendricks, optimism comes with caution. at 62 years old, his pension is in limbo. >> i do

. ~ so and i know sheriff mirkarimi probably has some unfunded or definitely underfunded mandates that are before him. could you repeat what you think your requested need are -- is for two staff and how that would help to address that requirement that you have now with the realignment? >> yes. as i mentioned, there will be 2,200 parole violators that will be assigned to the public defenders office next year. the reason why we know that's true is because the contract is now held by this group called cal pap which has a contract with the state and that's how many hearings they handled last year. the department of corrections notified us to expect that they were going to have 5 to 10 cases of parole violators, that they're going to be referring to us every day. those individuals will be arrested, they'll be brought to court and will be we'll be assigned to represent them. they'll have to be interviewed the same day to find out what their circumstances are and then brought to court that same afternoon where they'll meet with a commissioner and we'll be offered a settlement offer to see whe

that's mostly because of health care but it also reflects really chronic underfunding of education.he piece of education we spent a lot on is the degree programs, very, very expensive tuition for college but the benefits of that look economic had economically questionable. we'd be better off improving our high schools which for most people in the u.s. deliver a sub prime education and the further down you go, the income distribution until you get to the really poor zip codes the worse the schools get. it's very interesting mobility, social mobility has declined in the u.s.. we talk endlessly about inequality but we should worry about social immobility. if you're born into the boston quintile chances are you're stuck there. that isn't what happened in the past. what happened to the american dream? >> even though he says the u.s. has its structural problems ferguson is hopeful about the future and gives the overall economy a b plus. if you want to see more visit cnn.com/yourmoney. >>> coming up, men's underwear, lipstick, shark attacks and hot waitresses. you probably can't guess what

one states that are not fiscally sound based on pensions many other cities in america have badly underfunded pension. will be closely watched because michigan's constitution holds across the specifically bans cuts to retiree pensions and benefit payments if michigan is allowed to come to cut payments this could set a precedent for other municipal bankruptcy around the country detroit has been called a huge test kitchen for me in municipal bankruptcy hopefully the fire in the kitchen can be put out before it spreads to the. joining me is our t.v. producer rachel courteous thank you for joining me on this latest daily duel glad to be here we're good talking to troy to let's just launch into this story detroit has become the largest city in the us to file for chapter nine bankruptcy however a recent michigan court ruling raised questions as to whether the bankruptcy will even stand up to court review so rachel if it does succeed for filing into bankruptcy who are the winners and the losers here politically that's what yet to be seen bob i think the big reason why anyone files for bankruptcy whe

corruption on top of all of this destroyed is whole eggs with the billions of dollars in debt they have underfunded pensions and benefits they owe payments to banks and other general obligations given the city's worsening conditions it is in no position to pay all of this back was even more concerning as detroit is not an isolated incidents city of all across the country are facing similar challenges the wall street journal pointed out oakland which has the highest crime rate in california recently laid off more than one hundred police the fun retirement benefits and pension obligation vaughn's murderers and robberies shot up in the city borrowed an additional two hundred ten million dollars we also have chicago which was downgraded by moody's last week this city is having to make tough decisions between funding pensions and their schools they're making balloon payments just to keep retirement funds from going under and laying off teachers to meet payroll. then we shed a lot called philadelphia effectively bankrupt is the fifth largest city in the us they have about nine billion dollars in outstand

i just wanted to add a point about the underfunding. samhsa reports that only 2 percent of people with severe mental illness actually have access to evidence-based supported employment. and, and the, the mismatch between what we fund and what is effective. what we know from some of our research is that in the long term, people who work use the mental health system less and so the savings, the cost savings can be phenomenal over the long term. one area, which we really haven't talked about a little bit is, individuals in recovery starting their own businesses. and i know you mentioned your husband is in recovery, and you want to talk about how he got into business? well, yes, he's in recovery and, fortunately for us, it wasn't out of necessity that we created our business of, you know, a safe haven. it was out of a desire to help others that may be suffering from something that he went through, but didn't have the resources to get the help that they need. so we decided, as a charitable thing, to just open up, you know, a recovery home. w