Assuming they can laugh about such things, pension fund accountants might consider telling a joke that goes like this: What’s the difference between General Motors and California? California hasn’t gone bankrupt. At least, not yet. General Motors Corp. did go bankrupt, of course, in a historic Chapter 11 filing orchestrated by the federal government last June. A similar fate for California isn’t out of the question, though it is unlikely. No US state has ever gone bankrupt, although California’s Orange County back in 1994 and, more recently, the City of Vallejo did take the plunge. California’s $20bn financial crisis — just the latest in a series, like a Hollywood horror movie with endless sequels — makes it Exhibit A of the pension funding predicaments looming over many state and local governments in the US. And as it happens, these crises have a lot in common with the pension overhang that helped sink General Motors last year.