-- 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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Wirepoints should start an Illinois budget tracker listing: Govt Body, Budget, Actual, Difference. It’s getting hard to track all these govt entities ending their fiscal years in the red.
I think they should also do a “body parts sales” tracker. Tell us what’s on the balance sheet, and what’s left to sell off? The difference in assets remaining and the total sum of annual deficits might be when this thing implodes. In other words, when there’s nothing left, no one will create bonds, making the state insolvent.
How much is left to sell?
That’s a great question but hard to answer. I have asked that question of people in the know and never gotten a clear answer. In the case of Chicago, I believe the answer is “not much.” For the new pension obligation bond, Chicago’s CFO was reported to be looking hard to find what else could be sold, and that appears to be challenging.
Don’t know which body parts are spoken for, but taxpayers are getting the finger.