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Illinois Teacher Pensions

WildCat said:
The problem with pensions is that the promises are made by people long ago, while the bill for their promises gets shoved down the road to future people (which is now the present) who not only can't afford it, but never even had the opportunity to hold those responsible accountable because they're long gone before we even reach voting age. The provision about pensions in the Constitution was put there when I was 5 years old.
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Tough.

You are a citizen.

As long as you are, you are responsible for the debts of the state according to your share.

You might not have voted for it, but every teacher, every cop, every firefighter who taught or protected you before you reached age of majority was earning their pensions, and you benefited from that in the quality of the people willing to take those important jobs.
 
BenBurch said:
Tough.

You are a citizen.
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I could also be a citizen of Indiana or Wisconsin or North Carolina etc etc. As could every business in the state. And no one is moving here with that bill hanging over their heads. Hell, Chicago lost 200,000 people over the last decade.
 
DavidJames said:
Are you saying if you don't vote or if they didn't do what you want you can opt out of anything they do?
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Hell, if we all started to think like Mike! does, then we could justify never voting for anything because we think that would get us off the hook for everything from paying taxes to the military draft/conscription to jury duty.

But then, I'm sure most people would still use the public schools, roads, and other services provided by local, state, and federal governments. Interesting, eh?

People just want something for nothing, it seems. And the most pervasive expression of this attitude politically is, in my view, this idiotic notion that we should cut, cut, cut taxes yet at the same time expect good/better schools, good/better roads, good/better services, etc. Idiocy... pure idiocy.

ETA: Let it be known to everyone here that while I'm super-pissed about the pension situation in Illinois, I am personally doing more than just venting my spleen about it. I knew what the fiscal situation was going into my job 14+ years ago, and I know that there are no true 100% guarantees in life, so ever since I've started teaching I have also been investing in private accounts such as Roth-IRAs, 403b's, and other potential revenue streams for my retirement. The way I figure it, if both the state pension system AND the private financial markets go to hell in a handbasket at the same time, then I should be more worried about hiding in the basement with a shotgun (due to societal collapse and the resulting Zombie Apocalypse) than my retirement.

Unfortunately, there are also a lot of good public workers who will get completely screwed if the public pensions go belly up, because they simply didn't have the means to do what I did. And that's just not right.
 
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Mike! said:
Don't I wish! :mad: Doesn't mean I have to like it ether. And since the best option I've got right now is bitching on a message board, so be it! ;)
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I know you're kidding somewhat, but in all seriousness if you think complaining on a message board is your best option, you had better get used to a long, disappointing, and bitter life.
 
WildCat said:
The problem with pensions is that the promises are made by people long ago, while the bill for their promises gets shoved down the road to future people (which is now the present) who not only can't afford it, but never even had the opportunity to hold those responsible accountable because they're long gone before we even reach voting age. The provision about pensions in the Constitution was put there when I was 5 years old.
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Yup, this is basically it. And no one, with perhaps the exception of Gov. Quinn, has the balls to publicly state that raising some tax revenue might be at least a partial solution to the mess.

That's why me and a lot of other people voted for him last time around: he was the only person who wasn't shrieking the idiotic "don't raise taxes, just cut everything!" mantra as a solution to balancing the books.

I don't doubt that some kind of adjustment to the pension system is probably inevitable, but anyone who thinks that only cutting spending is the solution is living in a fantasy world :rolleyes:
 
MattusMaximus said:
Yup, this is basically it. And no one, with perhaps the exception of Gov. Quinn, has the balls to publicly state that raising some tax revenue might be at least a partial solution to the mess.
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And taxes were raised 66% on individuals and businesses. Nearly 100% of it goes to pensions.

MattusMaximus said:
I don't doubt that some kind of adjustment to the pension system is probably inevitable, but anyone who thinks that only cutting spending is the solution is living in a fantasy world :rolleyes:
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We got the tax hike, when will the unions show flexibility on their end? And just for fun...

union_pig.gif
 
BenBurch said:
Feel free, I'm told Racine is nice.
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Perhaps. Meanwhile, in the UK:
Reporting from London—
Teachers, doctors, court reporters, border-control agents, ambulance drivers and other public-sector workers walked off the job across Britain on Wednesday in a massive protest against the government's plans to overhaul their pensions.

...Still, the walkout disrupted the lives and routines of millions of Britons and added to the wave of social unrest barreling through Europe. Countries such as Greece, Italy and Portugal have been hit by huge demonstrations and strikes against the brutal austerity measures that many European governments have been forced to adopt to bring down deficits and beat back the continent's relentless debt crisis.

Here in Britain, public-sector workers are angry over the Conservative-led government's plans for them to work longer before they retire and to contribute more to their pensions. Negotiations over those measures are ongoing, but officials say an overhaul is unavoidable given longer life expectancies and government budgets in the red.

For elementary school teacher Michael Holland, that would mean working up to eight years more than he'd planned and paying in as much as $155 extra each month. It's money he and his wife would find hard to spare, especially since the government announced Tuesday that raises for state workers would be capped at 1% for two years starting in 2013, far below the current rate of inflation.
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If there's any fully funded public pensions out there they're few and far between.

Complain about moral obligations all you want, but at the end of the day the money is not there and governments have other obligations as well - to the elderly, to the sick, to children. Where's the morality in taking from the weak to give to the strong?
 
WildCat said:
Perhaps. Meanwhile, in the UK:

If there's any fully funded public pensions out there they're few and far between.

Complain about moral obligations all you want, but at the end of the day the money is not there and governments have other obligations as well - to the elderly, to the sick, to children. Where's the morality in taking from the weak to give to the strong?
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Well, you know, it's a promise someone else made that HAS to be kept. It just HAS to be. How could that ever be questioned?

If you promise the Moon, can you deliver?
 
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WildCat said:
Perhaps. Meanwhile, in the UK:

If there's any fully funded public pensions out there they're few and far between.

Complain about moral obligations all you want, but at the end of the day the money is not there and governments have other obligations as well - to the elderly, to the sick, to children. Where's the morality in taking from the weak to give to the strong?
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Part of the issue in the UK is that, with a few exceptions (the local government officers' pension scheme springs to mind), there is in fact no fund. The superannuation payments that employees have been making (and the nominal payments made on their behalf) have just been going into the general taxation pot.

The local government officers' pension scheme is apparently well in surplus but it's nigh on impossible to do the same calculations for any of the other schemes even in a hypothetical fashion. The unions claim that the schemes are in surplus but of course there's no way to verify this. The payments from the schemes are due to fall significantly over the next 20-30 years due to the fall in the number of scheme members and the reduced benefits already agreed over the past years (later retirement, different inflation measure used for index linking, using average rather than final pension).

Canadian teachers' pensions are in actual funds (not sure whether it's all or some) and they are major players in the UK utilities market.

Anyway, these days in the UK unless you are an executive (who still have very generous pension provisions thanks to the fact that 100% of their salary can be paid into a pension scheme tax free) the pension game is now a race to the bottom thanks to:

  • The move from defined benefits to defined contributions schemes meaning the employee bears all the risk
  • Significant reductions in company contributions
  • Poor stock market returns
  • High fees for fund managers
  • Poor performance from fund managers (underperforming an already poorly performing market)
  • Significant reductions in annuity rates
  • The removal of a tax credit for pension divident payments

Mrs Don and I are currently investing between £20k and £30k a year into our pensions and have been doing so for a considerable time. Prior to that we were in company schemes. With 20 years to go until nominal retirement there isn't a hope in hell that we'll have enough money to live on in retirement. Right now our pension funds stand at a little under £300,000 (which is less than we've paid in - this year alone the funds have lost close to 10% - about the same as the market). We need at least £1,500,000 to have anything like a comfortable retirement. It's frightening.
 
Here's a daydream about how to solve Illinois' woes:

Now two downstate Republican lawmakers think that they've found a solution for Mr. Wooters and other disgruntled Illinoisans who want to escape but can't: Cut off the pesky tail that's wagging the dog—separate Chicago from the rest of the state.
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As the article notes, that's not likely to happen. But it does make clear the dimensions of the problem:

Little wonder why. The state's bond debt has soared to $30 billion from $9.2 billion in 2002, when Democrats seized control of both the governorship and statehouse. Lawmakers have borrowed $10 billion just to fund the state's pension system, which is running a $210 billion unfunded liability. In fact, all of the $7 billion raised by this year's income and corporate tax hikes is going toward funding pensions.
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The Don said:
Mrs Don and I are currently investing between £20k and £30k a year into our pensions and have been doing so for a considerable time. Prior to that we were in company schemes. With 20 years to go until nominal retirement there isn't a hope in hell that we'll have enough money to live on in retirement. Right now our pension funds stand at a little under £300,000 (which is less than we've paid in - this year alone the funds have lost close to 10% - about the same as the market). We need at least £1,500,000 to have anything like a comfortable retirement. It's frightening.
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Between $40 and $60 thousand a year for a considerable time, you have 20 years more to contribute, and you fear that will not fund a comfortable retirement? You'll need at least $3M?

That seems high to me, especially given the free health care you'll enjoy during your retirement. Health care costs (health insurance costs actually) represent a significant cost for retiree's over here.

Do you believe you'll need $3M because the cost of living where you intend to retire is so high, or are you retiring young and living long?

I'm honestly curious. I don't have an analogous situation. I have never had to consider my retirement savings in the same way most Americans do. I have a defined benefits pension from my first career, a defined benefits pension from my second career, and whatever is left of Social Security when I reach eligibility age. I am covered under military medical for life - which really means until I am eligible for medicare. It ain't free, but it is better than most private insurance offers. I contribute to our version of a 401k, but really only as much as necessary to maximize my employers contribution.
 
And the abuses keep coming to light, no wonder the state pensions are underfunded by nearly $90 billion.

Private workers, public pensions:
For a few days' work proctoring exams in 1999 at a Downstate community college, Raymond Roskos Jr. earned $364.

He'll be paid much more later. That brief service in the state higher education system is all it took to qualify Roskos to eventually draw a public pension based on his salary with the Illinois Federation of Teachers. Last year, he made $76,232, state pension records show.

The state pension code was revised in 1998 to make employees of statewide teachers unions eligible for inflated public pensions if they already had service credits in the plan — just like the Chicago-area labor leaders who benefited from city public pension funds.

In addition, Illinois lawmakers have allowed privately employed individuals from university foundations and associations to get benefits through the State Universities Retirement System, or SURS. Those groups include the University of Illinois alumni association and the private fundraising foundations at the U. of I., Southern Illinois University and Northern Illinois University.

State law also specifically mentions the quasi-governmental Illinois Community College Trustees Association, an advocacy group funded by state community colleges.

...Ronald Ettinger. A retired professor at the University of Illinois at Springfield, Ettinger boosted his pension considerably by spending the last four years as executive vice president of University Professionals of Illinois, where he earned about $98,000 lobbying on behalf of public university faculty.

"I think it's a very legitimate program, personally," said Ettinger, who now makes about $92,000 a year on the state Educational Labor Relations Board in addition to about $92,000 a year in pension benefits.

It's beneficial for union leadership to come from the universities that the union represents, he said. "We've become part of a smooth, functioning institution," Ettinger said.
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Well isn't that special Ronald Ettinger! Odd you never mention the taxpayers footing your bill as parties to your "smooth functioning institution". I imagine most institutions will run smoothly when 3rd parties are responsible for paying all your bills.

This kind of crap is why I'm so anti public unions. The unions demand sympathy for their cause, stressing how they're little guys just like you and me while at the same time screwing every state taxpayer every chance they get. They know their pensions are too generous, they know their contributions and employers contributions aren't enough to cover the benefits. They know it's wrong to include non-state employees in state pension plans. But they just don't give a damn, because they figure no matter what the taxpayer will be on the hook for their largesse.
 
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