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Texas cashes in when retired teachers die

* Texas could soon be cashing in every time a retired teacher dies under proposals that educators there have called grotesque and ghoulish.

Plans to take out life insurance policies on retired staff could generate $500 million (pound;270m) for the teacher retirement system of Texas. This is the custodian of pension payments for 200,000 retired education workers, based on different projections of how long they are likely to live.

The scheme, cooked up by Wall Street banker Phil Gramm, a 1996 Republican presidential hopeful, is touted by UBS Investment Bank of America as a pilot programme that could be extended to teachers and public employees across America.

"It's gruesome that a teacher's death could make the state money," said Donna Haschke of the Texas State Teachers Association. "It's going to be a money-making scheme for someone, but probably not teachers."

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