PROVIDENCE, RI -- State Rep. John Loughlin, R-Tiverton, is proposing a federal bailout for the Rhode Island pension fund and any other state pension fund in "dire straits.''

Loughlin conveyed his suggestion in a series of letters to members of the state's Congressional delegation, including U.S. Rep. Patrick Kennedy, the Democratic incumbent he may challenge next year for Rhode Island's 1st District Congressional seat.

His argument: "We have already sent nearly 2 trillion dollars to Wall Street, this is the kind of "bailout" that frees us from a system that all agree is unsustainable...At the same time, we acknowledge the "sins of the past" without punishing vested teachers, and state employees to whom we have obligated pension benefits.''

In short, he is proposing "a federal infusion of approximately $361 billion to be distributed among the states,'' in amounts sufficient to erase or at least substantially reduce the unfunded pension liabilities in each state and "honor the promises made to teachers and public sector employees , while averting the budget crises that funding this liability would create absent a federal intervention.''

Under his proposal, each state that accepted the money would be required to replace its current pension system with a new "hybrid'' plan that combined a small defined-benefit pension with a 401K style, self-directed, fully portable plan, akin to what the federal government provides its employees.

There was no response from the spokesmen for Kennedy and U.S. Senators Sheldon Whitehouse and Jack Reed.

Nor was there a response from House Speaker William J. Murphy who has not responded to questions about where he stands on the proposals that came out of a pension-study commission chaired by Rep. Timothy Williamson that he appointed.