December 1, 2013 By: Mark Glennon


Under a particularly galling provision in the outline of the pension deal recently released, today’s fat cats get special protection.


Means testing should be a key theme in any pension cuts. That is, small pensioners who really need their pension, who worked to a true retirement age and didn’t spike or double dip, deserve more protection than fat cats with excessive pensions. Towards that end the pension deal appropriately includes a “pensionable salary cap” — the salary on which pensions are based would be maxed out at about $110,000.


But guess what? There’s a “grandfather” provision that excludes those with salaries already exceeding the cap or that will exceed the cap based on raises in a collective bargaining agreement (that is, a deal made through their unions). The exact language is here:


Pensionable salary cap: Applies the Tier II salary cap ($109,971 for 2013), which is annually adjusted by the lesser of 3% or of the annual CPI-U. Salaries that currently exceed the cap or that will exceed the cap based on raises in a collective bargaining agreement would be grandfathered in.


Maybe there’s some legal rationale for this exemption. Most of the bill is constitutionally suspect, and perhaps current high earners have a better case than others.


Maybe this is juice for the judges who will rule on the deal, whose salaries far exceed the cap. Justices of the Illinois Supreme Court make $207,066 annually; appellate court judges, $194,888. Their pension is not addressed in this deal under the reasoning that they would have a conflict of interest if it did. That’s phony and cosmetic because how they rule on this deal clearly will have some precedential bearing on reforms to their own pension that will have to follow, their pensions being the most bloated in the state.


Or maybe the exemption is there because today’s  high salaried workers are the ones with influence in Springfield. They include union bosses who participate in taxpayer funded pensions and control the purses on the union PACs that fund so many political careers. Tomorrow’s high paid folks aren’t here yet to pull any strings.


Whatever the rationale, the exemption stinks — like so much else in this rotten pension system. The whole system reeks of conflicts of interest, unfairness, corruption and rank excess, all of which are inevitable with government run defined benefit plans.