-- 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 disagree with much of it, but you have to remember that it was written primarily to address how much credit risk there is in state debt. That’s not a good proxy for the welfare of state residents. Debt holders, like ratings agencies, only care if they will see a payment default, not about services and other things important to residents. And they have a very short term perspective. From their narrow perspective I agree that IL bonds are pretty safe, unlike many IL municipalities.
Thanks Mark, I was sensing thier perspective was from the narrow fiscal lens of a 3-5 year bond risk analysis; Allthesame, its refreshing to read the sky-is-not-falling in Illinois fiscal news on occasion.
This artical, and the direct quotes from the articals experts, give hope that Illinois fiscal problems are quite solvable once we reconcile our political divide. Are these experts from standards and poors credible? Is there reasonable cause to disbelieve thier opinions? I like hope if its credible.