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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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Chart 5 could be titled, “Pension Trickery.” Chart 5 leads one to believe the major cause of the unfunded liability is Employer Contributions. That is not true. The major cause of the unfunded liability is benefit increases. How is that possible? Consider the following series of questions, answers, and commentary. Would the five state pensions be fully funded if they were at 1940 benefit levels? Yes. Are pensions at 1940 benefit levels? No. Why aren’t the pensions at 1940 benefit levels? Because the General Assemblies passed state laws approved by Governors that hiked the benefits, even though pensions were already… Read more »
Pelosi and Schumer want +$225B for education in the next ‘covid relief’, plus +$500B for states – The Federal taxpayer bailout is coming. This was part of the deal in the Senate for Democrats to go along with Republicans H1B giveaway and the $740B defense reauthorization. The GOPe does NOT have Americas back!
Looks like a great plan. All it requires is for the state taxpayers to gradually double (and actually make) their contribution to the pension funds over 25 years and never miss a contribution for any reason ever, and for the funds to earn 6.5-7% net of politically padded expenses over the 25 year period in what is currently a 2% risk-free world. What could possibly go wrong? it will be interesting to see how critically or uncritically the press reports these jolly numbers. We have seen solid plans before, but periods of poor financial conditions have forced short or skipped… Read more »
haha, yeah, a fool and his money soon part
that’s why they want illinoisans to stay in IL
and all the dem policies that encourage people to stay are….waiting…
That’s an accurate summary.
Excellent analysis, Dr. So why would a major corporation want to set up shop in Illinois then try to entice employees to move there? I’d venture to say that Elon didn’t even have Illinois on his short list.
As soon as I can sell my commercial building I am Florida bound.For what it is worth when I bought the property 40 years ago taxes were 60,000 last year 140,000 and this year drum roll 190,000.That is after the cartel appeal brought it down from 295,000.The lawyers cartel get 35,000 of that 105,000 savings.Illinois land of extortion.