Detroit bankruptcy fuels wider battle over pensions

McClatchy reports:

"Detroit could be a step in destroying public pensions, though the law says you can't cut benefits," said John Logan, director of the labor studies program at San Francisco State University. "If they a find a way around that, it opens Pandora's box, and the battle on whether to dump bank loans or dump pensions may go all the way to the Supreme Court." In California, CalPERS contends that its retirement system is "an arm of the state ... different than other creditors." Still, CalPERS chief counsel Peter Mixon expressed concern in a recent interview that municipalities could "seize on a 'bankruptcy solution' if they felt like the state laws ... could be avoided."

An article well worth your time.