This article was published by The McAlvany Intelligence Advisor on Monday, December 5, 2016:
Chicago Public School Officials were so sure that they would get another bailout from the state that they actually put it into next year’s budget. The city is behind on making a $730 million pension payment due its teachers’ pension plan, and the $215 million they were expecting from the state would allow them to make it.
The bill that passed the state senate unanimously and the house overwhelmingly was headed for Governor Bruce Rauner’s desk for signing until Rauner (pictured) learned that the Democratic leadership had no intention of keeping their promise to institute significant pension reform in order to get the bailout.
Rauner vetoed the bill last Thursday, invoking the wrath of the Democrats involved in the head-fake. In his veto message Rauner called them out:
Today I return Senate Bill 2822, which would give $215,000,000 to Chicago Public Schools without having reached an agreement on comprehensive pension reforms for the State and local governments.
In June we agreed on a six-month funding bridge [conditioned upon] an agreement to end the budget impasse.
As a pre-condition to funding schools statewide … we … agreed to provide CPS with $215,000,000 … but only if we came together to pass comprehensive reform. Without [those reforms] taxpayer money would continue to be wasted on bailout after bailout….
Today [Senate Democratic leaders] denied … that this bill would depend upon first enacting comprehensive pension reform.
It wasn’t really an agreement after all, complained the Democrats. It was an“informal” understanding that, once they had the money in hand, then they would begin “serious” discussions about how to fix the state’s and cities’ various grossly underfunded pension plans. CPS CEO Forrest Claypool invoked a hidden “agenda” of Rauner’s which included hurting poor minorities in response to his veto:
Governor Rauner has today acted impulsively and recklessly, reneging on his promise to our school children, their teachers, and their parents….
By going back on his word, Governor Rauner is treating Chicago children like they deserve less than every other child in our state. With a stroke of a pen, the governor has relegated poor, minority children to second-class status….
Chicago Mayor Rahm Emanuel weighed in on the horrible injustice of Rauner’s veto as well:
Make no mistake: it’s our children who will pay the price. The governor is lashing out… and proving just the latest example of his willingness to put the burden of his failures on the backs of the state’s most vulnerable citizens, whether it’s schoolchildren, college students, seniors, or those living with disabilities.
All of which is just for show, and fodder for the liberal Illinois media trying to cover for the politicians who have spent the state into bankruptcy. In a surprisingly clear explanation of how Chicago and the state of Illinois got itself into this pickle, Huffington Post wrote:
Funding pensions in Illinois has been anathema for decades to the operating theory of most politicians, who greatly prefer to spend money today on things voters can see and love immediately [rather] than to sock it away in pension systems. Elected officials get a lot more bang from state budget bucks that lead to ribbon cuttings than from those that bring only nods of approval from pension actuaries.
That’s the dream that Democrats have — making promises they know they can’t keep, but they don’t care. They’ll be long gone by the time the math catches up. They pass the hot potato from one congress to the next, hoping that, like musical chairs, they’ll be ancient history when the music stops playing.
Chicago is bankrupt. It has been bankrupt for at least the last ten years. It has been losing jobs, and tax revenues, for years, in an “unstoppable downward economic spiral,” said Michael Bargo at American Thinker. Chicago’s population has fallen below where it was in 1920, while the number of white people living in the city has declined to below where it was in 1890. In 2015 the Chicago area lost more than 6,200 residents, the “greatest population loss of any metropolitan area in the U.S.”, according to Bargo. And half of them are millionaires who got tired of bearing the increasing burden imposed by Democrats.
Since Mayor Harold Washington issued his Executive Sanctuary City Order in 1985, illegal immigration has put increasing burdens on those still working to support them. Refusing to face reality, Democrats have continued raising property taxes, increasing the city’s bonded indebtedness and taxes on everything a resident buys: gasoline, cable TV, phone service, alcohol, and parking stickers, among other things.
The state lost 105,000 residents last year and now sports the lowest credit rating of all 50 states, along with the highest unemployment rate in the lower 48.
And so far nothing has been said here about Chicago’s claim as the murder capital of the country.
Chicago is dying, as is the state of Illinois, thanks to wounds deliberately inflicted by Democrats seeking votes by granting, among other things, generous pension benefits to their constituencies, and letting someone else worry about how to pay them. Teachers retiring now, according to actuarial and mortality studies, expect to receive more than $2 million each during their retirement, enabling them to dream of moving to Arizona or Florida where the weather is nicer and the chances of getting murdered are significantly lower. They are going to have to make other plans. The city owes an estimated $100 billion in unfunded pension liabilities.
This is how Detroit wound up cratering. Chicago is headed down the same path.
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Sources:
Chicago Tribune: Rauner’s veto leaves CPS with a big budget gap to cover
NBCChicago.com: Senate Overrides Rauner Veto of CPS Pension Bill, House Adjourns Until January
Chicago Sun Times: http://chicago.suntimes.com/news/gov-rauner-vetoes-215m-cps-teacher-pension-bill/
ChicagoCBSLocal.com: Governor Rauner Explains Veto Of CPS Pension Bailout
Huffington Post: History of the Illinois Pension Crisis Could Be Learning Moment
RebootIllinois.com: Rauner vetoes $215 million Chicago schools bill, says Dem reneged on deal
American Thinker: Chicago’s Collapse Has Begun
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