-- 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.
SIGN UP HERE FOR OUR FREE WIREPOINTS DAILY NEWSLETTER
The article exhibits a serious misunderstanding of actuarial concepts in paragraph 10. The tax levy hasn’t increased because a minuscule number of people live past age 110 to 120, contributions are higher, in part because large numbers of people are living into their 80s where just a generation ago they were dying in their 70s. Elected officials, pension trustees and municipal staffers need to educate themselves on what drives pension costs and challenge actuaries who try to offer this false explanation for higher required contributions.