Better government doesn’t include paying what you owe, it seems.

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The Better Government Association’s solution to the pension liability.

Give me a couple of minutes to review the Illinois pension problem.

Our state pension is now carrying a $130 billion dollar liability because for decades the state didn’t pay their share.

The Illinois Supreme Court ruled that the 1970 Constitution’s pension protection clause which states that current retirees and current members of the pension system cannot have their pensions diminished or impaired.

So, put those two facts together and you must come up with the conclusion that the debt must be paid.

Revenue must be raised.

Try taxing the rich for a change.

Better Government Association policy and civic engagement director at the Better Government Association writes a Sun-Times column which starts with the facts I stated but then ignores the solutions.

Instead she talks about State Representative Matwick’s plan to move future employees to a 401k.

The benefit of such an idea for future state employees aside, will this help pay off the debt?

Nope. Not until all current retirees are dead.

Oops.

I think I get what she means by better government.

 

6 Replies to “Better government doesn’t include paying what you owe, it seems.”

  1. I was watching a special about how this group of Vets was getting the run-around from the VA in relation to cancer they had contacted while serving on active duty. The cancer came a short time after they had completed their military duty. The VA claimed that if the cancer came more than a year after their service, and they weren’t being treated for the cancer during that year, they supposedly did not contact the cancer while serving their country, despite working in conditions that scientifically related to the cancers that these men had. The documentary was called, DELAY, DENY, WE HOPE YOU DIE! It was a sad documentary that left you with the feeling that our government was really sticking it to these young people who were now suffering and trying to get by with these mounting medical bills. Then I thought…..wait a second……I think our government might be trying a similar strategy with teachers…..especially after reading this morning’s post about the government paying what it owes. If you haven’t seen the documentary, check it out. The title may be appropriate for the condition that Mr. Klonsky has described for us here today.

    1. Funny how you are so predictable, Nelson. In a state which has no graduated income tax, where the Pritzker family members pay the same rate of income tax as the housekeepers in their hotels, the FIRST thing that comes to mind for you is taxing retirement income. No problem. But remember, this isn’t a tax on just public employee and teacher pensions. ALL retirement income would be taxed. Your Social Security. Your retirement savings. All of it. Don’t start with a revenue system that has the wealthiest pay a larger share. Start with retirees. Okay. Don’t just tell me. Bring it on. Bring it up to your state rep. See how they respond.

      1. Retirement income is the first place to go because it is the last place no one has been. Retirees are the only completely untapped resource of revenue for the state. When a retired person pays a LOWER rate of income tax than the housekeepers, that’s a problem. When the few bucks left on the dresser for the housekeeper is more than retirees pay in IL income tax for an entire year, that’s a problem. And yes, include all retirement income. Why otherwise?

        I did ask Pawar and Biss at a forum. I asked them if they can be truly progressive if their platform does not treat retirement income the same as all other income. They wisely avoided giving a straight answer.

    2. Boo Nelson! How about a penalty tax on institutions that didn’t meet their obligations to state and city employees who worked in the trenches…..some for
      30-40 years? Usually whenever I’m late on paying a bill, I am subject to some sort of additional penalty.

  2. Dear Nelson, do you realize that the retired teachers and other public employees have already paid their share into their pensions? Every paycheck has their pension contribution deducted. The state took the employer matching funds owed the pension funds and spent it on other things without permission of the employees or the pension systems. The state owes the money they stole from the retirees. Your proposed solution, a new tax on retirees is like someone having to pay money to replace money already stolen from themselves.
    Do you know what happens if an employer in the private sector fails to pay the employer matching funds into social security? The IRS stops by, audits the payroll records and demands payment, with an absolute deadline. If the payment is not met, the IRS stops by again with the chains and padlocks, and that employer is out of business.
    Anon

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