So, I've thought about this a lot and concluded democratic governments (democratic, not Democratic) just can't do this. The incentives to cheat are just too strong. Problem is accounting standards? There's always a legal-by-the-letter-of-the-law way around these rules (loophole) you can find if you work hard enough (just look at Illinois -- "pension ramps", "pension obligation bonds", etc), and even if there's not, most voters won't care enough to dig into the discount rate and other assumptions being used to forecast pension liabilities.
Perhaps our political culture has changed and people used to be more honest, or far-sighted. But, given the world we live in today, especially given the pressure state and local governments are under, I think there really is no other option than a fully-funded 401(k)-style defined contribution plan, to finally force the issue into the open. There are plenty of well-managed 401(k)s and it's the only way to get "cash on the barrelhead" that keeps everyone honest, and doesn't allow the sort of absurd can-kicking so many governments (and their electorates) have favored for the past 30 years.
Perhaps our political culture has changed and people used to be more honest, or far-sighted. But, given the world we live in today, especially given the pressure state and local governments are under, I think there really is no other option than a fully-funded 401(k)-style defined contribution plan, to finally force the issue into the open. There are plenty of well-managed 401(k)s and it's the only way to get "cash on the barrelhead" that keeps everyone honest, and doesn't allow the sort of absurd can-kicking so many governments (and their electorates) have favored for the past 30 years.