When politicians lose interest in reform, taxpayers “lose interest,” too.
Last week Gov. Quinn’s special legislative session failed to pass a bill dealing with Illinois’ pension problems. Yet even if any measure had passed, Illinois’ massive problems would persist. The proposals debated in Springfield were far too small to make a visible dent in the state’s unfunded liabilities.
That’s too bad, because the longer Illinois politicians stall, the higher a price Illinois taxpayers will pay.
The price of inaction? Let’s take a look.
The state of Illinois is obligated to pay out $632 billion in pension benefits between now and 2045. To plan for these payments, the state needs to have $146 billion invested today. If that money earns the 8% annual return it is supposed to, the fund would be able to meet all future obligations without problem.
However, there’s a catch: the state doesn’t have $146 billion today. Instead, it has only set aside $63 billion, leaving an $83 billion hole. More HERE