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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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It seems more and more of the mainstream media are running more pieces about public pensions. Seems to signal that a widespread collapse is on the horizon. Another good article that sheds light on the problem. Now the next question will there be the political will to prosecute those responsible.
Most arrangements are structured so that public officials end up making the final decision. For example, the actuary suggests a range of assumptions and the governing body selects the assumption to be used. (Example, how much return will be realized on our pension fund?) The public officials generally have statutory immunity from prosecution or civil liability. The actuaries have something in their engagement contract relieving them or indemnifying them from responsibility. Furthermore, the damage caused to taxpayers by years of malfeasance and cronyism is beyond the ability of any culpable party to pay out of his or her own pocket.… Read more »
We must prosecute otherwise there is no end to the madness. I’m pretty sure the government can go after them (the administrators of these plans) under the directors and officers insurance policies. Also the honest service s fraud, RICO statutes, etc. The system is on the verge of collapsing and most of the retirees don’t even know it’s coming.
I have researched this extensively and invite you to do the same. As a starting point, have a look at Bay City Police and Fire Retirees v. Bay City Police and Fire Retirement System Board Michigan Court of Appeals – Decided: August 24, 2006 (2006 Mich. App. Lexis 2604). The Michigan Court of Appeals held that the Retirement Board is protected by governmental immunity against breach of fiduciary duty claims related to the Board’s investment of plan assets. This was a case involving civil liability for imprudent investment of 20% of plan assets in a security that proved to be… Read more »