By State Rep. Jeanne Ives -
Mayor Rahm Emanuel’s partial city pension overhaul passed in the General Assembly on Tuesday. The bill that passed merely scratches at the surface of the problem.
In October 2013, Barron’s shed some light on the severity of Chicago’s pension problem in an article that ranked the 20 most populous cities in the US based on their debt as a percentage of government revenue.
Detroit, currently bankrupt, ranked 12th at 372 percent. Chicago, ranked 20th – last place, at 683 percent. The article exposes that it would require ALL of Chicago’s government revenue for the next seven years to finally pay off the city’s debt and unfunded liabilities for worker pensions and healthcare.
Instead of legislation that recognizes the severity of Chicago’s fiscal condition, we were, yet again, handed a bill by those who helped create the problem, and told it was our only hope. But, the bill hides the true nature of the problem and the proper remedy.
What is hidden from taxpayers is the fact that this pension reform will, at a minimum, create a need for $750 million in additional revenue over the next five years most likely from property tax increases. But analysis of the schedule of needed revenue shows that the plan backloads the funding with a significant increase in revenue required in year 2021, concealing from Chicagoans that they can expect even more tax increases after the first five years. The unfunded liability will not be paid off for another forty years.
What is hidden from taxpayers is the fact that this bill is not true reform and enables a deteriorating retirement system. What is hidden from taxpayers is that they will contribute nearly 3 times more to the public pensions as employees will pay into them. What is hidden from taxpayers is the fact that there are reforms that can be made to our pension systems that could ease this burden. What is hidden from taxpayers is enough to drive them out of the state.
The cruel truth is that those in power are banking on voters and taxpayers not understanding that real reform is a modernized retirement system that aligns with the private sector and takes control of retirements out of the hands of politicians and puts them in the hands of workers. They further count on the fact that only 20 percent of those affected will even bother to cast a vote in the next municipal election.
It is going to get worse. Politicians eventually must deal with the larger Chicago funds that are in worse shape – police, fire, and teachers. Rolling out these reforms piecemeal hides the depth of reform needed by masking the entire cost to taxpayers. Hidden during debate is the $600 million in additional pension payments state law requires the city to make to its police and firefighter funds next year and the $600 million in pension payments needed for Chicago teachers at the same time.
Moreover, what is hidden in Springfield are the answers to all of the state’s problems. Politics are prominent in the state capitol and well-thought out, tested policy ideas are suppressed. The bills for real pension reform, business regulatory reform, a true balance budget amendment, public sector labor reform initiatives, tax reform, and educational reform are all ready for the next step of consideration. Taxpayers will never hear of them, because some unseen force has decided they will be buried in Rules Committees, never to be heard on the House floor.
Those that perpetuate this culture also hide in plain sight - shrouded by political power and prominent personas. Honest people cannot truly conceive of a culture that cares nothing for the truth or a ruling class unconcerned with considering the best ideas to solve our problems. Whether we want to believe it or not, however, the fact remains that the light of day is what is needed more than anything in Illinois.
No matter your political persuasion, we must make certain that the Chicago pension bill represents not only a fiscal day of reckoning, but a day of reckoning for those who have hidden in plain sight in Springfield, silencing discussion of any policy ideas that didn’t fit their political agenda.
