I was frankly puzzled by the press reporting of JP Pritzker’s budget address.
And puzzled by the teacher union leadership response as well.
They made it seem as if, in spite of the revenue problems the state is faced with because of the pandemic, education and public pensions were safe from any cuts and we should be grateful for the favor.
But while state education funding has remained flat in the Pritzker budget, it was flat compared to last year – pre-pandemic – which was short of the promised funding levels when the legislature passed education funding reform.
Passed in 2017, evidence-based school funding was supposed to get us closer to school funding equity between rich and poor school districts.
Pritzker’s budget keeps public pension funding flat as well. But again, flat compared to pre-pandemic levels when our pensions were only 40% funded.
They are 40% funded still.
JB includes the $5.7 billion statutory pension contribution in the new budget, relatively unchanged from last year.
The actuarial cost is $9 billion.
What is the difference between the statutory number and the actuarial number?
The actuarial number represents the real cost of the pensions.
The statutory number is made up. The governor and the legislature pick a number they think they can afford.
My friend, former TRS board member Bob Lyons, compares it to paying the minimum on your credit card.
Working taxpayers are going to end up paying a lot more in the long run.
Now, some are okay that at least education and pensions got what we got in the time of our plague.
But it was like this before the plague and it likely won’t change after because in spite of all the rhetoric about closing corporate loopholes in the new budget, there is not enough revenue to pay to run the state.
Closing loopholes or not, our taxing system still favors the rich.
We stupidly closed the door on one opportunity when the fair tax amendment was defeated by a massive tv campaign paid for by billionaire Ken Griffin and his pals.
But to open schools safely requires spending money.
And reducing the pension liability requires revenue.
Nobody saves money paying the minimum on their credit card.
The banks make their money that way.