Day: November 30, 2012

WirePoints Original: Why Illinois lawmakers can’t possibly set taxes rationally

November 30, 2012 No Comments

  Does the additional revenue that comes from a tax increase get cancelled out, in whole or in part, because taxpayers — especially high earners — leave or change their residence?   Astonishingly, nobody in Illinois government has attempted to answer these questions and the state has no data, no study, no clue.   I’ve asked several legislators from both parties and searched myself, but nothing is there.   The anecdotal evidence says the problem is severe.  Examples are reported publicly fairly often.  Tax planners say changes of claimed residency are now shooting up.  A partner at a major Chicago law

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Is the unfunded liability of Illinois’ teachers’ pension twice as bad as they say? – WirePoints Original

November 30, 2012 2 Comments

  The Illinois Teachers System (TRS), the state’s largest pension fund, released the editorial linked here on November 16.  It says “TRS at the end of FY 2012 had only 40.6 percent of what will be needed to pay all anticipated benefits over the next 30 years.”   But new rules already issued by the Government Accounting Standards Board will soon force them to make more realistic assumptions about how much money they make on their investments which will shatter even that horribly low 40.6% number.  The Center for Retirement Research at Boston College, among others, has estimated the impact

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Does Illinois violate its own budget and accounting laws? The state itself says yes — WirePoints Original

November 30, 2012 18 Comments

By: Mark Glennon*   One reason why Illinois is a fiscal wreck is that the state’s budget and accounting are muck, and they are prepared — according to the state itself — in open violation of state law.   The governor and the general assembly are constitutionally required to prepare an annual budget.  A statute, the State Budget Law, requires that the budget for the general revenue fund and other key funds be prepared in accordance with “generally accepted accounting principles for governments” and lists other specific accounting requirements designed to allow for a reasonable comparison of projected revenues to

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Just who is endangering Illinois’ municipal pensioners? WirePoints Original

November 30, 2012 No Comments

  We pension pessimists are actually pension villains — the hardball folks happy to cut pensions, starve retired teachers, steal from cops, and so on. We villains overstate pension shortfalls so government will cut them off.  Right?   Consider instead if it might be the deniers — those who say the pension and fiscal crises are manageable, mostly through tax increases — who are really endangering pensions of rank and file municipal workers.   Illinois was broke long before the “Illinois is Broke” campaign began.  Insolvency was apparent to anybody half good with numbers who took some time to look

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Cost of fiscal storm coming to Illinois will dwarf damages from Sandy and Katrina

November 30, 2012 4 Comments

By: Mark Glennon* Illinois has yet to come to grips with the enormity of the catastrophe it faces faces from its fiscal mess. Comparison to devastating storms may help. Let’s start with the high end of current damage estimates for Sandy — about $50 Billion, as detailed recently in the Washington Post, using data from the National Hurricane Center.  Katrina was worse when it hit New Orleans and the Gulf Coast in 2005 — $108 Billion, according to that same data, which would be about $128 Billion in today’s dollars.  Combined, the two storms total $178 Billion. What does the

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