-- 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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I am trying to look at this from a different perspective. Instead of using the term underfunded what about using the term “Defunded” Look at how all the ways this is done. Pension management fees probably totaling Billions over the life of all the funds. Unlimited spiking prior to 2010 without penalties then 6% after 2010 with penalties attached. 3% compounding. Expected fund returns of 7.5 to 8% but rarely attained. End of career advancements and salary spikes. Highest wages 4 out of 5 years to determine the pension but all the lower wage years are just calculated for total… Read more »
It’s just a bunch of Wimpys promising Popeye that if Popeye will buy Wimpy a burger today, Wimpy will give Popeye two burgers next week. Over-and-over. With Wimpy having no real means of ever making good on the promise. But as long as the music is playing, as Charles Prince said, “you gotta’ get up and dance.” When the music stops, everyone will get screwed.