-- 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 guess I should’ve known better than to think COVID relief money would be used for COVID relief. The Democratic administration continues to throw large amounts of money at mismanaged blue states; then, IL and other states claim they’re managing their states’ finances responsibly. This slows IL’s slide to insolvency that many Wirepoints commenters were hoping would happen much quicker.
It’s more printed money$. This is EXACTLY why inflation is never going to abate…never.
its more vote buying
Participants in the Central States Pension Fund “purchased” insurance through the Pension Benefit Guaranty Corporation. That insurance cost was factored into the employer compensation costs when they were bargaining wages with these participants. If that coverage was insufficient, it means participants weren’t willing to pay for better coverage. and benefited from higher salaries and benefits in the process.
That the insurance was insufficient to meet their expectations is not our problem. They already collected via higher wages. Now they have to pay the cost on the back-end. That’s the contract.
$36 billion going to help pensions says differently. Just like social security, we are not obligated to keep paying it but the people demand it so it’s our problem after all.
There’s little reason to believe that any of this will ever change. Missed that opportunity in ’74 when the creation of the Pension Benefit Guaranty Corporation “guaranteed” that private-sector union contracts could be underinvested-n-overpromised and count on taxpayers to make good on the unfunded debts. Like Social Security, Medicare and Medicaid, PBGC is another example of a Federal program that’s been so badly managed right from the start that for my entire lifetime, every year or two, the papers are full of one or the other of them going bust in 5 years or less unless something absolutely desperate is… Read more »
I wouldn’t feel that I was on the right track with one of my comments if I didn’t get a down-vote from PPF….
Equity for who???, not me
The most ridiculous aspect of +$90 Billion Multi-Employer Pension Bailout is it was passed with ZERO reforms to solve how these pensions got in this mess in the first place and going forward.
It’s almost like the federal government doesn’t want pensions to fail. What’s wrong with them. Don’t they know that people without pensions want these people to eat dog food. Surely that’s the better outcome.
Now these pensions are expected to remain solvent until 2051. That’s a long time to wait to take joy in the misery of others.
The thing is though the members of those unions elected the individuals that mismanaged/stole the funds in question. You correctly point to the Illinois voters for their pension problems but here try to justify not following the will of the union voters considering they more or less voted for the underfunded situation.
Illinois voters are now the ones responsible for the pension underfunding so in this case the teamster membership voters should be saddled with the problem.
I sympathize with your take on this, however problem is that all of the bargaining unit agreements the private-sector unions and employers have agreed to were based on the Fed’s promise to “insure” their benefits. I wonder how all of the players in this decision settled on $36 billion and 2051 for insolvency? What if the Teamsters collecting everything they’d been promised would have cost $36 billion, but only kept us “solvent” to 2031? Would everyone still have agreed to spend $36 billion of mostly non-Teamster taxpayer’s money for 20 fewer years? What did the Teamsters give up to get… Read more »
I don’t ignore it at all. Union members are voters. With that in mind though, years ago the Illinois public unions tried to force the state to make the required contributions. The courts told them that they had no right to a certain funding level and only had rights to be paid. Also, I’m not saying Biden should have bailed out these pensions. Just pointing out that the federal government doesn’t have the stomach to let all these people suffer even though the underfunding is not the responsibility of the federal government. What do you think that means for Illinois… Read more »
Since “government” is actually us, more or less in a democracy, it means that we pay up.
It’s that, or elect a new government. In Illinois, most of the sheep are perfectly happy voting in favor of having the wolves deciding what’s for dinner, as long as they can pretend that some other sheep’s name will be on the menu.
This demonstrates the limitations of democracy. The larger the demos the greater the demand for more of what “they” covet. The politicians they elect will provide what the think will get them reelected. It’s happening even while I pontificate so the entitled (who walk among us) demand more COLA while pointing out that Teamsters with pick-up trucks to tow their boats are eating dog food. Hyperbole serves the credulous fellow travelers while perpetuating everyone’s downhill journey.
Quite simply because it is the people of the State of Illinois that are financially responsible for the pensions and in the teamsters case it is the teamsters that are responsible for the debts they incur, not the public at large in either case
“in the teamsters case it is the teamsters that are responsible for the debts they incur, not the public at large in either case”
Legally yes. Politically we are on the hook for it.
Illinois pensions are legally the Illinois citizen’s responsibility. The teamsters, how so?
I just said legally it’s the responsibility of the teamsters and not the taxpayers. Politically, we are clearly covering this expense. Just like social security. We are not legally required to make payments but politically the US will continue paying SS benefits.
Ahhhhhh I misread your post thinking your “legally” meant something different. Thanks for the heads up!
I recall the attempts to force required contributions and, yes, they were rebuffed. Don’t agree with you on too many things, PPF, but you got that one right. I also understand the IL constitutional amendment passed in the 70s was to assure government union members that their promised pensions would be honored. Inferring IL government wasn’t to be trusted and without constitutional protection they could be expected t to renege on their pension promises. This is what decades of virtual one-party rule begets – a bunch of can-kicking, back-slapping, union-backed politicians who don’t give a rip about taxpayers or truth… Read more »
I do not care what you eat as long as you work for it like the rest of us.
I will NEVER VOTE for that A hole Biden now. Trump is a real jerk; I will never vote for him.
Vote for Paris Hilton, someone that looks hot. PPF try working in the private sector, Walmart is hiring, about the only job you could get. All government workers are useless.
You were never going to vote for him anyway. I’m eating a Tomahawk ribeye and drinking some Opus One tonight. You say you don’t care but I’m living rent free inside your head so I know you want to know. Life is good PT.
While the taxpayer who is a hard-working honest person eats dog food. Well, I think the end of this is coming soon. People are fleeing Illinois for a better life just about anywhere. The only people coming now are illegal immigrants, that have had a terrible life up to now. Even Illinois looks good to them, but not for long as they will catch on like everyone else has.
No those taxpayers cash their monthly welfare check, aka social security.
PPF, people that collect SS paid into it during their working life. They were also taxed to pay for your pension too which in general is higher than theirs and allows the public employee to retire long before the SS retirement age. Health Care is often included for retired public employees too. You’ll say these benies were “negotiated” and are guaranteed by the Illinois constitution. There was one party who was not consulted in this matter — taxpayers. I hope you live long enough to experience the bankruptcy of Illinois and have to actually produce something for a number ofvyears… Read more »
You paid a SS tax. You have no right to your social security check. It is no different than food stamps, section 8 housing and any other welfare check. It even pays low income lifetime earners a greater percentage of their working years paychecks. If it was truly a retirement system someone that paid double in taxes would get double in SS benefits. Instead this welfare program favors low earners. Also, pensions weren’t negotiated. This is a state law and unions aren’t negotiating payment. This was provided to employees on their first day of work. “There was one party who… Read more »
What’s the difference between one of these pensioners getting $500/mo (per the terms of PBGC) instead of $1,500/mo (per today/Biden) versus the random retiree who reduced their IRA withdrawals from $1,500/mo to $500/mo because their IRA balance was going to run dry? What’s the difference between a retired Teamster eating dog food and a retired AP Clerk eating dog food? Both the Teamster and the AP Clerk are in the same boat, both played by specific rules (if your pension goes bankrupt, a portion is covered by insurance; if your IRA goes bankrupt, you’re SOL), yet the government is bailing… Read more »
Sounds like you’re advocating for the AP clerk to join a union and demand a pension. Then they would have been ok.
Joining a union not only give you negotiating leverage against your employer but also strong political clout. Unions wisely used that clout.
Sounds like you’re advocating for the AP Clerk to eat dog food.
They already used that leverage. They negotiated a certain coverage under PBGC in exchange for a higher wage. They’re now going to receive an amount exceeding their coverage and that higher wage.
My stance is that neither should be bailed out. It’s not up to me.
The bigger question is why have a PBGC at all if the government if going to bail out the full amount anyway? Either create an insurance policy that meets the expectations of annuitants or don’t have one at all.
Why do we have subsidized flood insurance and yet the government still provides financial assistance after a hurricane? It’s what politicians do and what voters demand.
To buy votes from those that made bad decisions.
Senile Biden Gets Cucked By Kremlin Again — Frees Notorious Arms Dealer From US Prison — In Exchange For An America-Hating Drug Mule — And Throwing A US Marine Under The Bus — Leaving Him To Rot In A Russian Gulag – Breitbart
Between bailing out a private sector pension plan and freeing the basketball player it has been a very busy week for the vote buying Biden.
I can respect vote buying. The Biden regime is playing to win.
What happened the last time Republicans controlled the government? McConnell refused to give Republicans voters a stimulus check and it cost us both Georgia Senate seats and we lost the Senate.
Dec. 31, 2020: “In the few days remaining, GOP senators are ignoring Trump’s demand to increase COVID-19 aid checks to $2,000 and are poised to override his veto of a major defense bill, asserting traditional Republican spending and security priorities in defiance of a president who has marched the party in a different direction.”
https://www.wfla.com/news/politics/mcconnell-refuses-to-budge-on-2000-stimulus-checks-as-chaotic-congress-winds-down/
Two months later, the Democrat Senate gave us the checks anyways. THANKS REPUBLICANS!!!!
New $1,400 stimulus checks are on the way. Here’s who qualifies for the money
Published Fri, Mar 12 2021
https://www.cnbc.com/2021/03/12/1400-stimulus-checks-are-on-the-way-heres-who-qualifies.html
Hmm, could this contribute to inflation?
Silly you!
Inflation increased because you bought a grill during the pandemic according to Janet Yellen.
Crazy spending by Washington has nothing to do with the inflated prices we’re now paying – it’s OUR fault, not the government’s.
Stupid chickens.