Random thoughts. Rauner pension savings smoke and mirrors.

RANDOM

Let’s accept for the moment – just go with me on this – that the pension choice plan of Cullerton and Rauner wouldn’t be laughed out of the Illinois Supreme Court.

Bruce Rauner makes an amazing claim.

“As a first step toward bipartisan compromise, President Cullerton and I have agreed to support his pension proposal that will save $1 billion a year from four of the state pension plans,” Mr. Rauner said in his speech before a joint session of Illinois’ General Assembly. “I have instructed administration attorneys to work with the Senate president’s staff to finalize language as soon as possible. When they do, I urge both chambers to pass it without delay.”

One billion dollars a year?

From where?

First, recall that $1 billion a year was the same amount the they claimed Senate Bill 1 was going to save.

But a a study by actuaries last week placed that figure far higher. That’s almost an extra $1 billion a year, which is extremely significant.

Senate Bill 1 was way more far reaching in cuts than the Cullerton/Rauner plan which focuses almost entirely on a forced-choice between less salary, less pensionable salary and diminished pension benefits.

And it excludes current retirees, which Senate Bill 1 did not.

Yet they claim it saves the state’s pension costs the same $1 billion.

If they can’t save it from cutting benefits of current retirees, then how can they possibly reduce the state’s pension costs by a billion without some serious cutting aimed at current employees.

3 thoughts on “Random thoughts. Rauner pension savings smoke and mirrors.

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