Whats in your pension? An empty box of chocolate, MBS.

Illinois should just borrow the money from the pension fund to make up the pension funding short fall rather than raise taxes.

I thought pension funds with 8-9% annual returns can't go insolvent...

Don't worry the Federal Government will cover it!

Had some trouble with the link.

Try this one.

http://chicago.cbslocal.com/2012/04/02/t....

2029??!!??

It's in better shape then one thinks I suppose. I must be missing something.

Gov. Quinn has said "we're not funding the pensions of the Chicago area schools, but we put in a slew of money for the downstate districts; it's time they pay their way" which all but guarantees there's going to be cuts in benefits if he gets his way ... and yet, there's incessant cries of but they promised us we'd get these benefits, they have no right to take them away and all that stuff.

It really amazes me that people still live in Illinois and think the state is going to pay everything it says it's going to, but then scream and cry over any attempt the state makes to cut the budget [largely done to try and pay those promised benefits that it already can't afford]. The state is so utterly screwed on so many fronts, it's not funny; this is but one example.

Note: Gen, the link you currently have up doesn't go to the article you're referencing. [If it's been corrected, bilge this part as needed.]

This is the crux of the tragedy to me. You see, if all the pensioners the banksters robbed actually suffered the loss when the theft occurred, there would be hundreds of thousands, if not millions, of very*****ed off people out for bankster blood and the pols would be forced to behead a few banksters to stay in office. But these losses won't be realized for years, long after the culprits have absconded with the loot and the statute of limitations has run its course. Thus, it isn't just the poor pensioners who have been screwed - we all have - because the motivation to get good and mad has been temporally displaced. With a government uninterested in rocking the boat, those lashed to its hull will drown while the fat cats aboard drink champagne and eat caviar.

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absconded with the loot and the statute of limitations has run its course.

There is no statute of limitations involved when the mob appears and wants a public hanging...

"reduce past service costs for active members and retirees"

An example of the obscure indirect language these people use, as if they are trying NOT to communicate. He could have said, "reduce current and future pensions" and it would have been clearer to the public.

2029? So someone who is currently a 65 year old retired teacher who has been getting that outrageous pension for 10-15 years will get it for another 17 years? That person will be 82 by then. Talk about living in the sweet spot of the ponzi!

Being a business owner, the fear that bankruptcy is just two billing periods away has always been in the back of my mind, something I learned from a wise business owner 30 years ago. We're in better shape than that, but not by a whole lot--and it's always been that way. The smaller competitors in our market have either collapsed, re-organized (been bought or merged), or left the market completely. There will be no recovery for them.

A business is an engine to make money for the owners and shareholders. It's up to those running the place to ensure that they're saving money outside the business for their future outside of the envelope of the employed. It's not up to the business engine to assume the ever-increasing burden of retirement/health/lifestyle maintenance of those who have gone before us. That model just crushes the business. It's not up to my company to buy me a boat, a lake place, four weeks of vacation, a new BMW or Mercedes, a four wheeler, a snowmobile, or remodel my house. I know numerous failures who had their companies to do just those things, and now they're 'done.' McMansions in foreclosure, possessions for sale on CL or eBay, divorces, addictions, the Infomagic death spiral on a personal level. Probably some suicides coming in the months ahead.

I might feel bad for them, that they weren't smart enough to not f*ck up their futures and the futures of their families, but I'm not sorry enough for them to buy any of their overpriced, beat to sh*t stuff. Some, I've talked with at length and pointed out some good counselors. Nearly all are continuing on the path to an early departure. Tragic.

My pension responsibilities are mine, no one else's. I don't expect you to pay for me, nor will I pay for you from mine (willingly).

TANSTAAFL.

Those were all private-sector people I spoke of. I know a **whole lot of public employees** who could not understand the previous paragraphs--seemingly immune to adverse mathematics. They are teachers, firefighters, cops, planners, engineers, administrators, etc. Most haven't worked in the private sector, ever. They came to their career through a connection from a parent or uncle.

The notion of 'personal responsibility' is utterly foreign to them. Their time is coming, and it's a lock that they'll get all kinds of media attention when the bubble pops.

I will not feel sorry for them either.

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If you are counting on one of these pensions you are screwed.

Yep. Told my kids' teachers that years ago. Told them the math didn't add up and there's no way they're going to get the pensions they think they will. They looked at me like I was crazy. Heh... wonder if they remember that now...

My Mom is a retired CPS teacher. She keeps telling me that the pension will be paid because of the Illinois Constitution. So if the state is broke how are they going to pay? My mom just repeats that it will be because of the Illinois Constitution. <sigh> My dad is finally coming around to my point of view (or point of just a few).

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She keeps telling me that the pension will be paid because of the Illinois Constitution.

That's the response from all the teachers. I hate hearing it from those teachers making $160,000/yr or those administrators making $250,000/yr. They know their gig is good for another 17 years. Before then they figure they will just tax the citizens of Illinois to death so they can keep their lifestyle.

It's not good for another 17 years. The panic starts in less than ten.

The market NEVER lets you go all the way to the wall. It never has and it never will. Illinois will be unable to sell bonds at any materially decent rate and then the **** hits the fan INSTANTLY, not in "27 years."

Prediction: All previous debt and obligations will be paid on par with New Dollars.
Those holding cash will be the last ones screwed as they have to convert. Perhaps they will print them in pink to help with anger management every time you pull them out to use one...

Gen- It also solvent for 17 years if it's annual returns are 8-9% a year. Let's use the rule of 72 and do some modeling.... 17 years at 8% is a about two doubling. A modest 4% is one doubling,oops we are down to about 8-9 years. Probably eating some principal too at 4% which makes is about 4-5years to implosion without some creative accounting. Maybe Illnois could make their vendors Net Maybe and save some money.

Ohio ...

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Ohio’s five public retirement systems have collective unfunded health care benefit liabilities of roughly $30.5 billion, according to their latest Comprehensive Annual Financial Reports. Only 33.7 cents exist for every dollar in liabilities. Compared against these numbers, Ohio’s pension systems look relatively strong, with a 67 percent funded ratio.

In all fairness, Ohio is one of the better states at saving for public retiree health benefits. But with over $30 billion in unfunded liabilities, this is still something we should be concerned about.

Discussion over how to mitigate the impending health care crisis is just beginning. Proposed solutions have ranged from decreasing benefit payments, increasing the eligibility age, greater employee contributions and tax increases. A key sticking point going forward will be legal challenges to cuts in current employee benefits. As seen in California, cutting supposedly non-guaranteed benefits can prove challenging in the current legal envirnment. In the end, it may be down to the taxpayer to bail out the system.

The key take away is that the public employee retirement crisis is not a pension issue alone. In Ohio, total pension and health care benefit unfunded liabilities total over $100 billion. The $6,200 weight on the backs of taxpayers grows to over $8,600 when health benefits are included.

http://buckeyeinstitute.org/the-liberty-....

Has anyone wondered why it is so important for ObumerCare to stay around so the state pensions can move the health coverage off their liability sheet and pass the cost to every taxpayer in the United States and problem is solved all of the state union pensions are now solvent happy days here again and now they can ask for some other benefit that is completely unrealistic and cannot funded.

Advise01 said:

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Has anyone wondered why it is so important for ObumerCare to stay around so the state pensions can move the health coverage off their liability sheet and pass the cost to every taxpayer in the United States and problem is solved all of the state union pensions are now solvent happy days here again and now they can ask for some other benefit that is completely unrealistic and cannot funded.

There is no doubt that is what they will do with OPEB (Other Post Employment Benefits); e.g. healthcare. But pensions are separate from OPEB.

For example - in NJ - the underfunding for OPEB is approx $65 BILLION.

Whereas the underfunding for pensions is approx $60BILLION.

Even if Obamacare takes NJ's OPEB promises - the state is still short $60BILLION for the pension promises.

But... but... I'm protected by the Constitution. So nothing to worry about.

Yup, that's what I hear whenever I bring this up.

You are correct that they will not be able to get rid of the pensions but I am sure they have a great CPA/Banker and with the current cost of coverage being reduced or just paying the tax/not a tax which will change the underfunded to become overfunded of the OPEB they will be able to borrow against it and move it to the pension side and the $60 billion gets much smaller or goes away. Remember with the current accounting standards moving $20 from your right pocket to your left pocket makes you $20 richer.

We hear that ``protected by the constitution'' stuff in Alaska, too. Politically connected people have told me that it is far more likely that there will be a constitutional amendment to remove that protection, than that there will be a tax to fund the pension obligations. Alaska's public pension system is one of the sounder ones in the nation, and the clear-sighted are already starting to see it won't work as it stands.