Bloomberg and Liu (nycmayorsoffice's flickr)

Mayor Bloomberg and Comptroller Liu, working together? Nope, hell hasn't frozen over—the mortal enemies have teamed up to blow up the city's pension plans so that they can be reborn, phoenix-like, as one giant $120 billion dollar pension fund. Both pols are bullish on the idea, which has union backing, and are hoping Albany will approve it. Basically the idea is by putting the city's funds together with more streamlined management it will be easier for the funds to make money. And, as Bloomberg put it yesterday, "the more investment returns you have, the less that taxpayers have to put in.”

Assuming the plan goes through the new fund will be lead by a professional chief investment officer chosen by the new unified pension board. Bloomberg and Liu say their plan "was in many ways modeled on the pension plans of Harvard and Yale." When other cities have tried similar tactics the results have led to improvements in returns between 1 and 2 percent, which would translate to between $1.2 and $2.4 billion extra dollars for New York's pension funds. "Our labor leaders and trustees have delivered a huge win for taxpayers and city workers alike with this game-changer," Liu said at yesterday's presser announcing the plan.