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Summary and audio linked here.
Chicago’s political leadership is floating a pension buyout program as evidence it is seriously addressing the city’s thirty-six-billion-dollar unfunded pension liability, but Mark Glennon, founder of the Illinois policy research organization Wirepoints, said that the proposal moves debt from one column to another rather than reducing it, and that the broader fiscal picture facing the city continues to deteriorate across every measurable dimension. Audio here.
Expect no retraction or apology. This what they do.
The state’s existing buyout program for its own pensions is the precedent for Chicago, which should be a warning: Look out for similar exaggerated claims and shoddy analysis.
Full interview and summary linked here.
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If I may insert my layman’s math here, this is an additional $19.25 billion we’ll be spending on schools over the next 10 years. Remember how hard it was to find an extra $350M for this year’s budget, even with the tax hike? For next year’s budget, we have to find $700M more than this year. Year 3 is $1B more than this year. And so on until we hit the magical $3.5 billion. Another way to think about it…state education funding will consume an extra quarter percent of state income tax rate every 3 years (a quarter percent =… Read more »
Right. And what nobody has modeled is what happens when that funding does not materialize, and it won’t. That’s where the 4-tier formula is rigged in favor of Chicago. Others will be cut back first and Chicago will get a disproportionate share of what there is. That favoritism is in addition to the express $300 million or so bailout for Chicago in the bill.