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Municipal Markets Analytics partner Matt Fabian acknowledged the city has a history of “back-loading” its debt: putting more principal at the end, thereby ballooning those late payments. But he argued Johnson’s plans is a “more extreme version” of that dubious structure. “Future taxpayers will be paying for improvements that current taxpayers benefit from. … It leaves future taxpayers to address the city’s current management failure to address its budget in a sustainable manner,” Fabian said.
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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Why does this smell like the parking meter deal?
Detroit here we come
We’re already there. Take it from an exDetroiter. Most Chicagoans just don’t know it
You’ll know it when you can’t find a Marianos, Dominiks or Jewell in the entire city.
This is fiscal suicide. Amtrak tried this scheme in the 1990’s, when they were on their ‘glide path to self-sufficiency’. It was all smoke and mirrors then as this financial idiocy is now. Mayor Cliff Notes has zero economic knowledge other than tax and spend, and borrowings of this kind enable the latter even in the face of a shortfall in the former.
Political animals make lousy managers. Always.
Any entity that lends the City of Chicago money deserves what will be rendered by Chicago’s inevitable bankruptcy.
https://americansforfairnessinlending.wordpress.com/the-history-of-usury/
This is the financing deal you get with politicians and teachers that don’t understand basic economics. Brandon’s background as a “community organizer” and teacher has long been to drive the cash to the teachers. This isn’t simply borrowing, this is a cash grab of a magnitude that is ringing alarm bells all over the country. Where will that money come from at maturity? Doesn’t matter. Just like a spendthrift paying interest only on their credit cards. Amortizing a $2B loan at 8% over 20 years is MORE THAN $16MIL A MONTH. But Johnson is happy to let the next mayor… Read more »
Out right theft from the next generation.
We now have a new another example for Webster under insanity.
Big picture. Brando & crew drain the TIF funds to payoff highest paid in nation CTU, etc and now come up with this $830 pay-day bond/ loan that will end up costing dopey Chicago taxpayer $2 mil. …..what a con job in bankrupt ZERO growth Chicago
2 Billion – not million, little typo!