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The We Are One White Paper.

December 19, 2012

I’m reminded of an old joke.

A woman goes into a meat market and asks the butcher why his pork chops are 7 dollars a pound, when the guy across the street is selling his for 4 dollars a pound?

The butcher says, “Well, then, why don’t you go over there and buy his?”

The lady customer says, “Well, he don’t have any.

The butcher says, “Well, that’s nothing. When I don’t have ANY, I sell mine for only 3 dollars a pound!”

The We Are One coalition of public employee unions, faced with an all-out attack on our constitutionally and contractually protected pensions, issued their White Paper today.

I would call it highly anticipated.

But it really wasn’t.

At least it wasn’t highly anticipated by the political leaders in the state.

They have not found it necessary to consult the representatives of those of us who have paid into the pension system for years and years.

Not only has the union leadership not been invited to the table. They aren’t even being told what room the table is in. Or what time dinner is served.

So-called progressive legislators like Nekritz, Biss, Gabel and Cassidy agree that it has been a mistake to ignore the pension member representatives, but  then they went and constructed a bill without any consultation or input from those representatives.

WAO’s White Paper is a three parter.

The first explains what the impact of proposed pension cuts would be.

The Illinois Federation of Teachers’ Dan Montgomery: “Our study proves that Gov. Quinn’s proposal is a devastating assault on the life – savings of the state’s dedicated public servants, which will have disastrous economic effects, including the loss of jobs. We can and must do better by our teachers and police and all Illinoisans.” 

The second part demands an “ironclad guarantee of funding.” They provide numerous sources of revenue that could resolve the state’s funding shortfall.

The third offers the deal: Provide the ironclad guarantee of funding and the members of the pension systems will be willing, in the spirit of shared sacrifice,  to discuss increasing our contribution.

Perhaps this offer would be more meaningful if:

  • Public employees were part of the process.
  • There could actually be an ironclad guarantee of funding.
  • Those like Ralph Martire of the Center for Tax and Budget Accountability hadn’t already provided the solution for increased revenue: A state graduated income tax, which when combined with a refinancing of the state’s pension debt, would allow for a 30 year payoff of the debt and a reduction in taxes for a large number of the state’s citizens.

What we now have is an ironclad guarantee of our pension benefits.

It is guaranteed by the language of our state constitution – our benefits may not be diminished or impaired.

In spite of what IEA President Klickna says, the concept of shared sacrifice opens the door wide to trade away guaranteed benefits or to increase our current contribution.

It is  buying a pig in a poke:  The promise of guaranteed funding in exchange for what we already are guaranteed.

What happens if they don’t keep the promise of guaranteed funding? A promise that they haven’t kept in over 50 years? What, for example do we do – who do we take to court – if they shift the pension obligation to the local districts?

And who among us doesn’t know that if we give in on benefits or contributions, they will never stop coming back for more.

It is like buying the pork chops from the butcher who has no pork chops but is selling them for 4 dollars a pound.

One Comment leave one →
  1. December 19, 2012 6:11 pm

    A brief response:

    An “Ironclad guarantee that the state will fulfill its funding responsibilities”: since Illinois Democrats want to shift the state’s payment for the pension systems to school districts and universities, besides reforming the “pension ramp,” I believe that a graduated income tax is the most important proposal to consider for raising revenue in Illinois.

    “A Well-Designed Graduated Income Tax Rate Structure Could Reduce Taxes for 94 Percent of Illinois Taxpayers and Raise at Least $2.4 Billion more in Revenue than the Current Five Percent Flat Tax.

    “If Illinois passed a constitutional amendment permitting the creation of a graduated income tax rate it could structure those rates in a number of different ways. For instance, if Illinois were to adopt the same graduated income tax rate structure as Iowa, Illinois would raise $6.3 billion more in revenue than it does from its current five percent flat rate, while 54 percent—over half—of all taxpayers would pay less in state income taxes.”41

    for the complete analysis: the Center for Tax and Budget Accountability

    Two questions public employees need to ask:

    1) Even if legislators invited union leaders to the table, why bargain away any of the public employees’ “constitutionally-guaranteed” rights and earned benefits? “A public employee obtains ‘vested rights’ in the Pension Code provisions relevant to pension benefits when the employee becomes a member of a pension system by making his or her initial employee contribution to the system. In addition, the Pension Clause protects pension benefit rights as an enforceable contractual relationship” (Eric M. Madiar, “Is Welching on Public Pension Promises an Option for Illinois” p. 36).

    2) Why modify the “constitutionally-guaranteed” Pension Clause “through contract principles” when Speaker of the House Madigan has made this quite clear: “Let the courts decide”?

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