“I want the truth.”
“You can’t handle the truth.”A Few Good Men, 1992
The Illinois pension liability truth- it’s not $80 billion but more
like $210 billion.
According to Professors Joshua Rauh of Northwestern University and
Robert Novy-Marx of the University of Rochester, the state’s pension
liability is $85 billion
only if current workers are fired
today. Otherwise, current contracted benefits for state
workers will put Illinois an additional $70 billion in the hole.
Furthermore, Illinois inflates pension asset growth by an
unheard of “risk free” 8.25% per year. Using a more reasonable
4% rate of return adds another $60 billion of taxpayer liability.
Here’s the pension truth: total taxpayer liability of $210
billion. Please
read the recent op-ed by Marc Levine in Crain’s.
There are only 13 million residents of Illinois. Every man, woman
and child owes $16,000 in public pension debt. Have a family of
four? Your family owes $64,000. You own a private company with 200
employees? For the government pensions, your company employees
collectively owe $3.2 million.
Illinois Pension truths:
1. Illinois pension liability tops the 50 states for the worst
funded. 2. The entire 67% income tax hike went to fund the
pensions. It wasn’t enough. 3. The system is unsustainable and
getting worse. Benefit payouts to retirees have nearly doubled since
2002.
We can do something about it.
Pension reform is being pushed by House Republican leadership with
the help of the Civic Committee of the Commercial Club of
Chicago. House Bill 149 is needed now more than ever:
· Giving current state workers three options: They could stay in
the current system and pay higher premiums to cover the true costs
of their benefits. They could go into a new system of more
financially manageable benefits. Or they could go into a defined
contribution system, similar to a 401(k) plan.
· Giving new state workers two options: They could go into the new
system of more financially manageable benefits or go into the
401(k)-style plan.
· Gradually pays off the huge unfunded liability with a set,
reasonable yearly payoff amount through 2045.
But it won't be easy to pass in the final few weeks of session.
Lawmakers will be under extreme pressure from unions and other
vested interests in Springfield to oppose it and embrace the status
quo. That's why Illinois needs your help.
Can your member of the General Assembly handle Illinois’ “pension
truth”? Ask them.
Call your state representative -
Look up their name and phone number. Explain your strong support
for
House Bill 149. Get your family and friends to do the same. We
are a strong grassroots voice. This is real reform that matters
in Illinois.
Together, we will bring a new day to Illinois.
House Bill 149 is
part of that mission.
