Cannot login if ~/.cache is dead symlink

On Ubuntu 14.04, graphical logins fail if ~/.cache is a dead symlink. Only the background picture and the mouse cursor is shown during login, and nothing else is started. Console logins still work.

This happens independently of the login manager (tested lightdm, gdm, and kdm) and the session (tested unity, gnome-shell, kde, and xfce). Therefore I guess upstart (the "init --user" process) is the problem, as it tries to log in to ~/.cache/upstart/.

My version of upstart is 1.12.1-0ubuntu4.

Steps to reproduce:

mv .cache cache.bak
ln -s /non-existent .cache
Try logging in.

I would expect that logging in just works without using the .cache directory in this case (e.g., not logging to .cache/upstart), or that the dead symlink would be silently removed and the directory created, or that an error message would appear and login would be aborted. The current situation is bad because it is very hard to find the cause of the login problem (I just stumbled upon it by accident).

ProblemType: Bug
DistroRelease: Ubuntu 14.04
Package: upstart 1.12.1-0ubuntu4
ProcVersionSignature: Ubuntu 3.13.0-24.46-generic 3.13.9
Uname: Linux 3.13.0-24-generic x86_64
ApportVersion: 2.14.1-0ubuntu3
Architecture: amd64
CurrentDesktop: Unity
Date: Fri May 2 19:42:54 2014
InstallationDate: Installed on 2012-05-31 (700 days ago)
InstallationMedia: Ubuntu 12.04 LTS "Precise Pangolin" - Release amd64 (20120425)
SourcePackage: upstart
UpgradeStatus: Upgraded to trusty on 2014-04-26 (6 days ago)
UpstartBugCategory: Session
UpstartRunningSessionCount: 1
UpstartRunningSessionVersion: init (upstart 1.12.1)
UpstartRunningSystemVersion: init (upstart 1.12.1)