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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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Here is a brilliant idea to offset the smart folks leaving the hellhole called illinois. Start taxing retirement funds from public pension systems. Most only contribute around 12% over the life of working in Illinois but take home a boatload. Tax public pension system at 12% and your budget problem are fixed. Now that is something D and R can agree on!!
That idea has been mentioned more than a few times here. The problem is that you can’t target public retirees for any IL income tax increase since that brings for the IL Pension Protection Clause argument against diminishing or even impairing IL public employees’ pensions. Because of that you have to ask every retiree in IL to pay an income tax on their retirement income. Doing that surely would be more likely to be successful in that you are asking every retiree to sacrifice rather than targeting a particular group. But, again, retirees have even less reason to keep a… Read more »
Precisely my point. Most other states tax retirement income. Why not Illinois? Because of the crooked politicians and 12% contributors to the Public Pension System that vote for them to protect to protect it! Why every year when the Democrats in the State of Illinois needs more and more money, every option is on the table except………ready, ready for this……………………………retirement funds.
SACRIFICE? You asked every Illinois tax payer to sacrifice when paying property tax which includes, guess what paying public pensions!
How would taxing pensions offset people leaving the state? Wouldn’t that cause more people to leave the state? As James has noted you can’t tax just public pensions. While I believe taxing retirement for everyone would be more than fair I don’t think you will ever get the votes without a progressive tax. I don’t know of any D that supports taxing retirement and I’m not sure there are too many Rs. They agree all right, just not the way you think they do.
NJ is assuming SALT deductions will be reinstated.
A state wide property transaction tax will also be in order. Imagine an 8% sales tax when the owner goes to sell their property. If the homeowner decides to purchase another home in Illinois that is equal or greater in value, then that tax is waived. If the homeowner is leaving Illinois then it’s one last tax to get the fleeing resident. The only people upset are most likely to leave the state anyway. People may flee but property will remain in the state. The state needs more tax dollars. They will need to get it somehow. The only thing… Read more »
I’m sure you’ll hear lots of reasons for disagreeing with your point here, but to me it makes some sense in terms of helping to pay for IL governmental accrued liabilities in that such a family would be paying for services already used or at least having been available for their usage prior to departure.
It is an economic question. If 90% of IL homes slide underwater. Then a homeowner will walk away from their property instead of selling for a loss. Home values will decrease and more homes will be underwater. Then what? The whole idea of paying pensions was that the economy was growing, people were moving in, jobs were created. Now it is in reverse. Now what? Government propping up the real estate market? So Pensions are Paid first is a utopian dream land. Good luck in Pottersville.
Considering that about 40% of all homes don’t have a mortgage your 90% underwater claim is unlikely. Also, collecting the tax could be done when the homeowner sells their property or if they abandon the property through foreclosure then the state can charge the homeowner the tax on their return. Underwater would not be an excuse to not pay your taxes. As an example. So a house that is worth 300k but the property owner owes 350k. The property owner walks away from their home. In that case the 8% tax would be calculated from the 300k value. The taxpayer… Read more »
Why not just admit where this is headed and confiscate the property of everyone who does not have a public pension? Save yourselves a lot of time.
PS- do it quickly before your victims escape
This site is advocating confiscating a portion of public pensions. I’m advocating confiscating a portion of every property. The difference is my method confiscates equally from all (including pensioners that reside in Illinois) who have an ownership stake in Illinois. This site is only advocating stealing just from pensions. My way is legal and fair while the other way is unconstitutional.
Confiscating from all sounds very fair, what reasonable person could object?
But of course only the pensioners get back what was taken (in the form of pension payments).
Everyone puts their ante in the pot. The pensioners get all the chips in the pot (the cards having already been dealt). Who is the winner of that game?
So yeah. I’ll take home equity loans and then walk away. Back in the housing mortgage bubble, many people I knew in Naperville who lived in gated communities had 2nd and 3rd mortgages – using your home as a piggybank was encouraged. Many of these folks defaulted and handed the keys back to the bank.
I saw a guy drive his one-year old Expedition-Limited to the Savings and Loan, leave the keys in it and told the teller the car was out front. And then he moved to St John’s.
My company (A Fortune 50 with HQ in NW Suburbs) went remote because of Covid with the ‘2 weeks to flatten the curve’ last year when the concern was overburdening hospitals – so over a year ago now. I’ve continued to go into the office because it’s easier for me and I’m ‘old school’, so I haven’t physically seen some Sr Mngrs for nearly a year – kinda weird. Of all things, last week I see someone in a office and it’s a manager that had been ‘working remote’. Honestly did not recognize the guy – he was trim and… Read more »
You’re making my point. He was able to leave Illinois and skip out on the bill. If the property transaction tax was in place Illinois would have been able to get 8% of the sale price of his home.
Sorry, ya missed it – Money never sleeps! People with $$$ are several steps ahead of your confiscatory (and likely unlawful) dreams.
State of IL employees and retirees, including yourself, say the state needs more tax dollars, of course. The problem is that IL is already the highest or nearly the highest taxing state in the country. More taxes will make worse the chronic problem of population loss in IL. The remaining 90-plus percent of IL taxpayers say the state needs to reduce spending. What line of reasoning makes more sense? At some point, IL must reverse the trend of losing population.
“The remaining 90-plus percent of IL taxpayers say the state needs to reduce spending.”
Really??? When Rauner ran on cutting taxes (moving it back to the rate prior to the budget veto) and Pritzker ran on increasing taxes the overwhelming majority voted for Pritzker. In fact, Rauner only received 38.8% of the vote.
Keep in mind the state lost 1.5% of its population in the last 10 years but yet the revenue collected is around 80% higher. Population loss by itself will not cause changes.
Guess you’ve proven what we already know. The public employee unions own this state lock, stock and barrel. They believe they can do whatever they please to the rest of us.
Hitler, Putin, and Chavez were also the winners of elections.
We should enact tiered tax systems just like the pension systems. For example, if Illinois wants to enact a statewide property tax, it only applies to new residents or those who have not purchased property before. Any additional tax is considered a diminishment and impairment.