Final answer:
Participating governments are equally over- or underfunded in cost-sharing multi-employer benefit pension plans, which is a challenge given demographic changes impacting the workforce. This issue is not unique to the U.S. and is seen in Europe and Japan as well.
Step-by-step explanation:
All participating governments are equally over- or underfunded in cost-sharing multi-employer benefit pension plans. The concept of cost-sharing plans means that all participating employers contribute to a single plan and share the costs based on some proration method. This type of plan helps to deal with the issues of providing retirement and health benefits in the face of demographic changes. However, when a cost-sharing plan is underfunded, it affects all participating governments equally, as they are all drawing from the same pool of resources. The challenge of ensuring adequate funding for these plans is not unique to the United States. Many European nations and Japan face even more severe problems due to an even higher proportion of elderly to workers. Governments must make careful public policy decisions on how to sustain and fund these pension plans, alongside other entitlement programs and regulations that penalize firms for underfunding their pension plans and aim to protect employees by providing more information about their pension accounts.