The government pension plans are fine because they have a very strong backer, i.e. the taxpayers.
Yes and no but mainly due to stupidity. Smart investors did well in the downfall of '09, which is why smart investors have money tied up in fixed income funds so after the crash they switch from F.I. to Equities or even borrow money to buy equities. That strategy worked well for me. Right now people should be pulling money out of equities (gradually) in preparation for the next crash (rummage sale).