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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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“That means school districts would have to make as much as 10 years’ worth of back payments into Social Security.”
That’s going to be painful, to say the least.
What stands out to me is the Federal law on “safe harbor” provision. Many teachers opted out of S.S. many decades ago and opted into state retirement systems. As long as the state (taxpayers) provide benefits equal to S.S. but not less than – that fulfills the states responsibility for the Federal law. How many teachers pensions are many multiples of what they would have received from S.S.? So, should the taxpayers liability to endlessly fund pensions stop at the “equals to” provision? If yes to that question there should be more than adequate money in the funds now and… Read more »
Makes me wonder why Tier 2 wasn’t a violation of the state constitution diminishment clause? So the constitution is “flexible” if the group doing the flexing are the fat cats in the union wanting to bleed the newcomers? This is the concept of seniority run amok, a meritocracy is so much fairer.
Because Tier 2 only impacted new hires that weren’t hired yet. The “unborn”, so to speak.
If I were a Tier 2 union member, I’d tell my union bosses to charge me Tier 2 union dues. Why should they pay the same price for less service?