A tiny territory of the U.S. between Japan and Papua New Guinea has some on the mainland concerned. Last month, the territory of the Northern Mariana Islands became the first U.S. public pension fund to declare bankruptcy. What are the chances something like that could happen inside the U.S.  Municipal pension funds were in good shape as recently as 10 years ago, but pension fund investment returns have averaged less than 6% over a decade and 1% over the last year. With a pension fund that is 32% funded, Providence, R.I., approved a plan to sharply curtail pension benefits to current workers and retirees to try and keep the city out of bankruptcy.

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