Keeping retirement weird. Tomorrow I get my post retirement pension increase. But the banks get a bigger one.

PIE CHART

Thanks to the courts, tomorrow I get my January 1st post retirement pension increase.

It will show up on Monday in my account.

I will get my increase because the court enjoined TRS from acting on Senate Bill 1 until the Supreme Court rules on its constitutionality. That may happen in May.

The current rules give those of us over 60 years-old a yearly 3% post retirement pension bump, compounded. That has kept retirees up with inflation rates over the past twenty or so years.

Truth be told, it isn’t a huge amount of money. The increase will cover one of my trips to the grocery store for a week’s shopping once a month.

Illinois State Representative Elaine Nekritz claims that these COLA costs are driving the stresses on the pension systems.

Yet the cost of pension benefits to retirees accounts for only 25% of the benefit costs of TRS.

All the rest – 75% of benefit costs – goes to the banks.

That’s because Nekritz and the rest of the Springfield crew underfunded the pension system and now there is more than a $100 billion dollar pension liability. The pension liability ends up as borrowed money that must be paid to the banks with interest.

In rough numbers that means that for every dollar that shows up in a retiree’s bank account tomorrow, the banks get $3 for themselves.

That’s a hell of a payday for the banks.

 

Keeping retirement weird. A fool’s errand.

wise fools

Sangamon County Judge John Belz wrote of Lisa Madigan’s defense of pension theft:

The Pension Protection Clause contains no exception, restriction or limitation for an exercise of the State’s police powers or reserved sovereign powers. Illinois courts, therefore, have rejected the argument that the State retains an implied or reserved power to diminish or impair pension benefits.

Because the Act diminishes and impairs pension benefits and there is no legally cognizable affirmative defense, the Court must conclude that the Act violates the Pension Protection Clause of the Illinois Constitution. The Court holds that Public Act 98-0599 is unconstitutional.

The defendants have attempted to create a factual record to the effect that, if a reserved sovereign power to diminish or impair pensions existed, the facts would justify an exercise of that power. The defendants can cite to no Illinois case that would allow this affirmative defense.

Because the Court finds that no such power exists, it need not and does not reach the issue of whether the facts would justify the exercise of such a power if it existed, and the Court will not require the plaintiffs to respond to the defendants’ evidentiary submissions. The plaintiffs having obtained complete relief, the Court also need not address at this time the plaintiffs’ additional claims that the Act is unconstitutional or illegal on other grounds.

In summary, the State of Illinois made a constitutionally protected promise to its employees concerning their pension benefits. Under established and uncontroverted Illinois law, the State of Illinois cannot break this promise.

Remember when some of us (John Dillon, Glen Brown and Ken Previti among others) spoke out against SB 2404, a bill that the leaders of the We Are One Illinois coalition of state public employee unions came up with in talks with Senate leader John Cullerton? We said it would also result in an unconstitutional diminishment and impairment of our pension rights.

Some former and the current leadership disagreed.

They argued that it was too risky to depend on the courts.

They argued that it would be better to cut our losses and deal with the likes of Madigan and Cullerton.

Maybe they were right and perhaps we were lucky we got Judge Belz.

People tell me that the Supreme Court may not be as friendly and true to the language of the constitution.

They point to the U.S. Supreme Court which has been hijacked by right-wing ideologues.

And I don’t entirely disagree that the courts AND the political bodies are no reliable friends of the the working people of Illinois.

Far from it.

Appealing to any of them and to their sense of fairness, justice and equality often appears to be a fool’s errand.

Judge Belz seems like an honest man who looked at case-law and concluded that the state had no legal legs to stand on.

It appears now that the state’s top court will rule the same way.

However, nearly everyone who follows the fight for pension rights says the same thing.

No matter what the courts finally decide about Senate Bill 1, the political leadership of this state will come back at us again.

And again.

To fend off these attacks we need our leaders to not just look for the least risky line of defense.

We in Illinois have political leaders, both Democrats and Republicans, who see their role as that of soley protecting the interests of corporations and allowing the public assets to dwindle and be sold off to the highest bidder.

Meanwhile our state goes deeper into debt.

The political leaders refuse to raise taxes on their wealthy patrons.

Our pension liability now stands at over $111 billion.

Corruption involving our City and state pension funds runs amok, with Mayor Emanuel and Governor-elect Rauner receiving campaign kick-backs from pension fund managers.

This is a time that screams for union leadership that has fire in its belly, can draw a firm line in the sand that cannot be crossed and is willing to back it up.

The political leadership has no respect for the rule of law when it comes to the majority of its citizens.

Next time we may not get a Judge Belz.

In box. Health care isn’t free now for retired teachers.

Fred:
I think another area of clarification when explaining to others our pension benefits, is that a large number of state pensioners who were part of AFSCME, etc. do get free health care, we’re not part of that group. My neighbors and friends have no idea the difference between AFSCME, TRS, SERS, etc. and the pension benefits for each system/group. My neighbors think I’m pulling the wool over their eyes when I tell them we’re not part of that group that gets free health care. I’ve been trying to educate them in that area. I find that I’m a bit more successful by acknowledging what they’ve heard is true—that a number of state pensioners do get free health care, but it’s not us. When I don’t mention that fact, I get a lot of resistance because they think I’m being less than truthful based on what they’ve heard/read about state pensioners in general. 
On another note, I have a friend who worked as a state employee 8 years (minimal time to be vested) at a mental health facility and supposedly has received free health care for years due to being part of AFSCME. According to what she tells me, it’s for life, not just until she reaches the age for Medicare. Nice, huh?
– Jan

Anyone know a good lawyer?

I have a question.

If the Illinois Constitution forbids the legislature from diminishing or impairing our pension benefits.

But our union is willing to negotiate our constitutional rights away.

But our union does not represent all the members of TRS.

Can our union negotiate for those they do not represent? Of course, they do not represent me either. But I’m speaking legally here. Are they legally allowed to bargain away TRS member’s constitutional protections?

And if the legislature goes ahead and diminishes and impairs our pension with the agreement of the IFT and the IEA, who would file the suit defending our constitutional rights.

Clearly not the IEA or the IFT.

My question: Anyone know a good lawyer who works pro bono?

Teacher pensions under attack? IEA leadership cancels May Lobby Day.

IEA President Cinda Klickna addresses PREA members at last year’s Lobby Day. This year she is telling us to stay home. Lobby Day has been cancelled this year by the IEA “no fight” leadership.

Shocking news from an IEA Region meeting last night.

The annual Lobby Day, where IEA rank-and-file members head for Springfield to meet with their state senators and house members has been cancelled this year.

The excuse is that the Capitol is going through some reconstruction.

The problem is that our pensions are threatened with deconstruction!

So check this out. There’s an election in November. There will undoubtedly be a bill from the House side that looks like last year’s HB 512. Senate President John Cullerton has already telegraphed his desire to reduce pension benefits in a way that would not lead to a court fight.

And the response from IEA leadership to the 133,000 members of our Association? Stay home.

Don’t fight.

Stay home.