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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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2006 Hourly Rates: Operating Engineer, Highway 1:
Base Wage = 39.75
Health = 6.85
Pension = 5.60
Vacation = 1.90
Training = 0.70
Total = $54.80
2019 Hourly Rates: Operating Engineer, Highway 1:
Base Wage = 49.30
Health = 20.50
Pension = 16.85
Vacation = 2.00
Training = 1.65
Total = $90.30
Increases 2006 vs 2019:
Base Wage = 25%
Health = 300%
Pension = 300%
Vacation = 5%
Training = 235%
Total = 65%
No one is talking about the insane pension costs for trade labor.
$90.30 an hour for 2000 hours a year is $180,000. That’s a 5%er type of salary.
Does the Pension amount include the employer FICA contribution? I don’t think it does. So add another $3.75 to the employers’ hourly pension contribution, bringing the amount spent on “retirement” contributions to over $20/hr. In other words, over one-third of the base wage amount goes towards retirement. That seems like a crazy number. That would be like Salesforce paying a programmer $100,000 and contributing $33,000 to his 401(k). Maybe not the best comparison given the “seasonal” nature of the trade labor…
How is this not getting more publicity?
This is why we get one mile of road for every five miles Indiana can do. There is a road near me that has been under construction for three years running, 159th near Orlando park. You never see anyone working, it’s been ripped up for years.