-- 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
Property tax rate cap would force taxpayers to make choices, because it caps tax levy as a function of property value. As PPF so gleefully always points out, the schoolteacher 58 year old pensioners have first crack at each and every tax dollar. After they have taken theirs, society’s current needs may then be funded. Current needs include teachers (and police, clean water, roads, and other somewhat important requirements of daily living). Since non-productive pension obligations demand great and greater percentage of tax revenues, current needs will not be able to be funded. So, the predictable future result: People will… Read more »
Even if IL pols fixed the “broken” property tax system, I doubt IL residents would benefit. Do you think the corrupt and greedy among IL pols will give in that easily? For example, if you find your property tax bill decreased significantly, you may also find you’re paying more tax on a gallon of gas than other states’ residents are paying for a gallon of gas including tax.That’s an exaggeration, but IL pols have a myriad of ways to recoup any lost property tax revenue by creating new taxes and fees and/or increasing existing ones.
Property taxes will never be reduced unless we raise taxes elsewhere. We just have too much debt. Anyone that believes property taxes will be reduced without a corresponding tax increase is living in a true fantasy land. There just isn’t enough spending to cut.
When does a city reach the point where residents abandon their houses and property tax revenues begin to fall below the cost of demolition? Detroit went from 1.8 million + population to the “neighborhood” of 600 K population. Neighborhoods in fact vanished with the out-migrations. Few who left abandoned any real equity. Banks eschewed foreclosure because they didn’t want to own houses looted of plumbing. Hell, even the city didn’t want to own property that would have been subject to confiscation for non-payment of taxes. The observation that debts such as pensions MUST be paid reminds me of Tom Lehrer’s… Read more »
Large swathes of the city and county are already half abandoned by residents because of high property taxes. The Cook County Land Bank exists to purchase these properties out of tax sales and return them to the tax rolls. But when you get into Detroit, that’s a different situation. It wasn’t just Detroit that collapsed during the 70’s, 80′ and 90’s, it was many urban cities. Detroit had a double whammy of losing much of it’s industrial base – cars – along with high inflation and high gas prices. But other cities collapsed too: Baltimore, Cleveland, areas of Dallas, Providence… Read more »
And the yuppies are again leaving Chicago for the ‘burbs as the dream of raising children in the Bell school district in lakeview are fading fast. Bell has lost over 10% of its school age population in 3 years, from 1005 kids in 2020 to only 900 in 2022, and some other sources say it’s actually only 876. Mayer in Lincoln Park has gone from 766 in 2018 to only 640 today. This massive flight out of CPS into the suburbs is at nearly every ‘good’ CPS elementary school. They’re all fleeing to the suburbs. I know my suburban schools… Read more »
My parents are gone but they left the city in the late 60’s, your chart explains why.
Well then P.T., the voters better get on board with more income taxes to make up for any property tax reductions or freezes. Their lack of desire to pay their bills is precisely why the courts have and will continue to demand that debts are paid.
Just another fantasy about the role and power of courts in a corrupt system. Lawyers file lawsuits and other lawyers defend them. They don’t do that pro bono. There is an irony in the Donald’s surname. Trump is that which overrides other factors. He’s currently on the defensive, but he has as many lives as the CTU. Both are essentially self-serving sluts. Laws and regulations can’t overrule thermometers and sea levels and empty aquifers. Judicial rulings can’t fix empty pension trusts and growing deficits. My question, which you seldom address, is how far and for how long can the can… Read more »
Debts that cannot be repaid, will not be repaid.
It’s as simple as that.
It’s the $200 billion dollar question when the default will happen.
I can foretell you that default will happen sooner rather than later.
“My question, which you seldom address, is how far and for how long can the can be kicked?” I don’t address something that I don’t think is anywhere near happening. How long can the can be kicked? No idea but I know that the longer we wait the more expensive it becomes for the taxpayers. Maybe all the doom and gloom folks can answer your question. I believe the state has vast taxing authority and they will continue to utilize that power as that is their own legal option. Anyone that tells you it’s going to happen soon (at least… Read more »
It seems to me that we are debating future outcomes in a time when outcomes are less predictable than they were in our lifetimes. Who’d have guessed that prosecutors wouldn’t prosecute or that laws would be ignored based on expedience or whim. I agree with the general observation that death and taxes are inevitable but that is different from the assurance that pensions will be paid even if government ceases to function otherwise. That’s more of a mordant or cynical extrapolation — “we are a nation of laws” therefore contract rights will be honored. Harvard’s team may fight to the… Read more »
Simple fix: Property Tax Rate Cap.
Many States (including California and Indiana, at 1%) have laws capping property tax rates at a specific amount of fair market value.
This would be the only way to force taxing bodies to stop spending in excess of the means of the taxed community.
Going to make those Florida’s pensioners really mad when their checks are diminished and impaired.or maybe we should tax grandma from her house in Illinois.
Those Florida pensioners will be just fine and will get a 3 percent raise in less than 3 months. If you don’t want grandma taxed out of her house maybe you should get behind the commercial club of Chicago’s plan to raise income taxes. Otherwise it’s more property taxes. It’s up to the voters who should pay more taxes but rest assured more taxes are on the docket.
Except the unions control everything and a 1% property tax increase isn’t going to pay all the teachers and unionized employee’s new contracts.
Spot on!!
Nothing anyone can do. PPF says Overly Generous Pensions must be paid and he is right. So, expect more of the same, higher and higher taxes, no other choice.
You’re finally learning poor taxpayer. Why the name change? Maybe you’re finally realizing that it’s not “poor taxpayer” when the same people are voting for this outcome.
Having gotten a good mortgage years ago, our property taxes are now nearing the monthly nut. Infuriating.
Yep AT, in Illinois you pay for your home twice.
Fire every third government employee in Illinois — there will be no detectable decrease in useful services, and property taxes can be cut dramatically
Da Guvmnt employees in Illinois own da corrupt Dems.
Da Corrupt Dems will never go for that.