-- 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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One of the things not mentioned in this or many articles is how the value of the actual pensioners payout acts as a brake on the growth of economy. Few to any economists will argue that the propensity to consume of those on the lower end of the income spectrum (which automatically exempts nearly all public sector workers) will spend nearly every dollar of marginal income. That means it goes directly into the economy from the low end and filters it way, slowly up in the local economy. In other words it is stimulative and increases the velocity of money… Read more »