-- Connecting the dots between our economy, government and business --
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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THIS IS A GOOD THING! Home ownership should be affordable.
Agreed. As it gets more expensive to own real estate in other states Illinois is becoming more affordable. Sure we pay more in taxes but that is factored in when choosing a place to live. It also makes it less desirable to leave Illinois to one of these new “expensive” real estate areas as the money you save in taxes now goes to an additional mortgage expense. Most people don’t factor in the opportunity cost of the loss of real estate growth and only look at their monthly expenses. The market is efficient even when the voters aren’t.
“It also makes it less desirable to leave Illinois to one of these new “expensive” real estate areas as the money you save in taxes now goes to an additional mortgage expense.” That’s one way of looking at it. On the other hand, Chicago appreciated less because it is a much less desirable place to live, as young people families and retirees are choosing to live in other, lower taxed red states. Low prices don’t make a place desirable – Englewood has relatively cheap home prices – but it’s lost 75% of its population in the last 60 years. However,… Read more »
It’s a mixed blessing, it seems to me. Yes, affordability is good, but there’s been a huge loss in wealth, or at least a failure to keep up with national appreciation. That data we had Zillow study for us showed that Illinois homeowners would be a quarter trillion dollars richer over ten years if their homes had appreciated at national levels. The negative wealth effect from that is humongous. https://wirepoints.org/new-data-subpar-home-appreciation-has-cost-illinoisans-quarter-trillion-dollars-over-ten-years/ And new workers want to go to places that are appreciating. Also, to the extent that prices here are being suppressed by higher property taxes, there actually isn’t any improvement… Read more »
Agree in part. Home ownership here in Rockford is affordable but the property taxes have been more than the mortgage for years now. Few have built equity considering almost 60% of the mortgage goes to taxes. Before this frenzy home values here have declined not appreciated due to high taxes so in 23 years you have paid in taxes what you originally paid for the home. Now this year it will be different unless interest rates will rise. Just heard that Amazon is building a 141,000 sq.ft building on Baxter Rd. They say it will help the local economy. What… Read more »