-- 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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What would be the public finance implications if the Biden administration followed existing laws?
Exactly.
Bond financing should be limited to projects that will have utility for many years: water systems, bridges, roads, etc. Things in the PUBLIC interest. Other uses of tax-exempt bonds are simply a way to kick the can and postpone reckonings that should be made (or, in most cases, are overdue). One might analogize an individual’s decisions to finance a house, a car or a vacation. For some, this is a path to financial ruin. Public financing is obviously different from personal in terms of who has to live with the consequences. Clearly not the consultants, actuaries, bond lawyers, etc. who… Read more »