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Progress or no?

Thursday, Aug 15, 2013

* On the one hand

Members of a legislative pension reform committee won’t put a timetable on when they’ll complete their work, although they continue to say they’re making progress.

Committee members — who spoke privately among themselves Wednesday — said there are still details that must be resolved before a reform plan can be presented to the General Assembly.

“We’re quite close,” said Rep. Elaine Nekritz, D-Northbrook. “I think it’s a matter of getting a few more details hashed out. How long that takes, when that announcement comes, I can’t predict right now.”

* On the other hand

Sen. Bill Brady, R-Bloomington, said he was disappointed by developments Wednesday.

“Today, I don’t think we made much progress,” Brady said. “The biggest obstacle is probably differing opinion on what amount of savings needs to be. At the end of the day, I think it’s coming down to how much savings is necessary to both protect what people have earned and be affordable to future General Assemblies.”

What I believe this shows is a serious attempt at partisan and ideological balance, which had been sorely lacking up until the conference committee began to meet. Speaker Madigan wanted to get as much savings as possible, Senate President Cullerton wanted to find a compromise with the unions. Now, the idea is to negotiate the amount of savings that one side can accept while still keeping in mind the damage that will be done to actual human beings.

The biggest problem, of course, is still constitutionality. I don’t think they’ll get past this issue until the courts weigh in. For now it appears to have been set aside.

- Posted by Rich Miller        


67 Comments
  1. - Demoralized - Thursday, Aug 15, 13 @ 10:26 am:

    It seems as though they are being very thoughtful in their discussions. That is very refreshing. It amazes me that people were all over this committee because they come out with a plan in 48 hours. It took decades to get to this point and you don’t solve it in a couple of days.


  2. - Demoralized - Thursday, Aug 15, 13 @ 10:27 am:

    That should be “didn’t” come out with a plan . . .


  3. - steve schnorf - Thursday, Aug 15, 13 @ 10:34 am:

    is it hard to set aside your oath of office?


  4. - Where will it end - Thursday, Aug 15, 13 @ 10:35 am:

    It doesn’t really matter when the legislature gets a pension reform plan, if it’s thought to be unconstitutional and ends up in court, we have made NO progress. Good intentions are fine but if the end result is still found unconstitutional what progress has been made?


  5. - Rusty618 - Thursday, Aug 15, 13 @ 10:37 am:

    Does the “savings” have to come at the expense of retirees and those about to retire? Let’s exhaust all other possibilities at fixing the problem, before those that are most vulnerable take a hit. If the money that should have been put into the pension fund were there all along, and invested properly, we wouldn’t even be discussing this.


  6. - RNUG - Thursday, Aug 15, 13 @ 10:48 am:

    If the SJ-R article is accurate about the structure being discussed / rated for savings, there are a number of constitutionality issues. Assuming the ISC follows past practice, here’s what is going to be a problem:

    1) Any change to already retired, including modifying the AAI (COLA)

    2) Any downward change to already earned benefits for current employees, including the AAI

    3) Any change to retirement requirements, such as increased contribution, increased service time, higher age, etc. for current employees

    4) Forcing a choice between plans, if you are unable to choose ‘keep what I currently have’

    I base this opinion on the previous ISC rulings and statements that, to slightly paraphrase, the terms in place at hiring plus enhancements granted by the General Assembly are the terms of the pension contract.


  7. - Timmeh - Thursday, Aug 15, 13 @ 10:48 am:

    “Good intentions are fine but if the end result is still found unconstitutional what progress has been made?”
    The question is, what parts would be found unconstitutional? I doubt all of it would be. Even after some of it is stripped, you’d still have something there and a better idea of what you can do.


  8. - Cod - Thursday, Aug 15, 13 @ 10:49 am:

    They all know their conference is a waste of time, a charade. They are considering plans that they know are unconstitutional and that violate basic standards of behavior and of contractual relationships.

    A true compromise solution should include raising future revenue by taxing traders, eliminating all corporate tax loopholes, and instituting a graduated income tax that doesnt impact the already disproportionately over-taxed middle class. Future pensions have already been cut dramatically. Any further pension reform should be about reducing the abuses of pension as political patronage rewards.

    That would be a fair and balanced compromise solution. The committee is apparently not looking seriously at any real reform or revenue solutions. That’s just not right.


  9. - Frenchie Mendoza - Thursday, Aug 15, 13 @ 10:51 am:

    I’m pleased to see compromise — an important part of the political process that is sorely lacking these days on both the state and national levels — but I’m confused about why they’re starting with the “desired savings” instead of “constitutionality of diminishment”.

    Why aren’t they seeking clarification about what they can diminish — and even if they can diminish? Is the only way to get this clarification creating legislation and then having the courts issue an opinion? Is it not possible to get an opinion now — prior to going through all the mechanics and logistics of — essentially — diminishment?

    I know Cullerton’s guy issued a year ago or so what appeared to be a pretty thoughtful opinion on this — but why is something like this not the starting point?

    From someone outside the process, the process itself seems predicated on ignoring whatever rules it will ultimately be forced to abide by. This makes no sense — especially if the consequences are as dire as what we’ve been led to believe. (Which, of course, as many posters have pointed out — these dire predictions may be themselves specious.)

    It seems much ado about — potentially and literally — nothing.


  10. - RNUG - Thursday, Aug 15, 13 @ 10:53 am:

    Can’t say if the committee is including revenue reform or not. They did take testimony on the State’s structural revenue problem from multiple source, including CTBA (Martire). The questions during the one session indicated some of the committee members got it.


  11. - Joan P. - Thursday, Aug 15, 13 @ 10:54 am:

    @ Frenchie -

    No, it’s not possible to get a judicial opinion now. Courts don’t issue advisory opinions; they only rule on actual cases.


  12. - RNUG - Thursday, Aug 15, 13 @ 11:00 am:

    To date, the ISC has been pretty clear on the no diminishment issue, as Eric Madiar and others have pointed out.

    About the only legal way to diminish current pensions is to trick the retiree into voluntarily giving up what they have in favor of something that appears better.

    Or, presumably illegally, force the retiree to choose between losing an arm or losing a leg.


  13. - jake - Thursday, Aug 15, 13 @ 11:02 am:

    I think the Ed Asner video is somewhat relevant here http://www.youtube.com/watch?v=S6ZsXrzF8Cc
    My point is that discussing massive expenditures or massive cuts without paying any attention to revenues is like discussing your household budget without regard to how much money you are making or might make. I understand that political considerations lead to the separation of the issues, so that we will deal with pensions first, and the graduated income tax later, but in this case political expediency is leading to moron policy and moron politics.


  14. - Federalist - Thursday, Aug 15, 13 @ 11:06 am:

    RNUG,

    The issues you have addressed are dead on target.
    But from what I can tell the Committee is stacked 8-2 against existing pensioners (or for cuts if you are I that camp.) Thus, I think anything they come up with will not truly address the issues you have outlined.

    It appears to me they want large reductions and then throw it to the courts. However, this is a committee and whether their proposal can get through the Senate is unknown at this time.

    As to Courts, who knows? Many assume they will rule against cutting benefits for those already retired and maybe even those still employed. Do not bet on it. This state is very political and to assume that judges will look only at the law and the intent of the law is being most optimistic. I am not saying how they will rule but I am very concerned and take nothing for granted.


  15. - A guy... - Thursday, Aug 15, 13 @ 11:08 am:

    Jeesh, and anyone wonders why they’ve had such a tough time reaching a solution. I’m praying they succeed. There’s only one place where the constitutionality can be decided. Hint; it’s not here. Once the legislators legislate, the judiciary will judge. That challenge has already been promised preemptively. From reading the remarks of Nekritz and Brady, a format has been agreed to and the actuaries and the legislators are looking for a middle ground that makes progress. I’d say that’s a whole lot better than we’ve seen to date.


  16. - RNUG - Thursday, Aug 15, 13 @ 11:14 am:

    Federalist @ 11:06 am:

    I’m a long retired state employee, so I’m obviously opposed to cuts on personal grounds.

    I can’t speak to the current crop of ISC justices, but I do know a former member of that elite group and I would trust him to rule on the law, not the politics.


  17. - RNUG - Thursday, Aug 15, 13 @ 11:17 am:

    Federalist @ 11:06 am:

    should have added .. I agree the committee / GA is going to punt it to the courts


  18. - Realist - Thursday, Aug 15, 13 @ 11:17 am:

    I have no doubt that any proposal put forward will be illegal under the constitution. The only question is whether the courts will ignore the constitution, and if so, to what degree?


  19. - Federalist - Thursday, Aug 15, 13 @ 11:24 am:

    RNUG,

    I am certain that your trust in that judge is well placed. But it is the current set of judges that I am concerned about. And no, I do not have any real insight as to the political/economic motives of these judges and I hope my concerns are proved wrong. But my ‘trust level’ for all of politics in Illinois is very, very low.


  20. - Frenchie Mendoza - Thursday, Aug 15, 13 @ 11:36 am:

    The other weird issue — or an issue I find weird — is that no one is talking about giving anything to retirees. It’s all about taking away, diminishing. Maybe this is too simple an idea — or too complex in its execution — but the idea of giving something as part of the plan would (I suspect) go a long way toward acceptance of the plan.

    I mean, I don’t even hear creative give backs — shorter hours in return for reduced pensions, longer vacations in return for reduced pensions, etc. Surely, there are creative ways to get folks on board — or at least ways to get folks to consider authentic choices.

    Is anyone even trying to articulate the question of, well, what if we gave something in return?

    A choice, yes — but a choice of different but equal options. A choice of diminishments doesn’t count. It’s odd to hear what seems to me to be obviously unconstitutional options — since the language is pretty clear in the constitution — but no one is stopping and saying, okay, can we give folks anything of authentic value in return?


  21. - RNUG - Thursday, Aug 15, 13 @ 11:46 am:

    Frenchie Mendoza @ 11:36 am:

    In the previous bills, the GA was going to give the retirees and employees something: their brass plated, triple cross their heart, “we really mean it” promise to make the ‘full’ pension fund payment every year.

    But it wasn’t an individual right, just a right for the fund to sue the State.

    And we’ve already got the pension clause and the ISC statement in IFT that the actual pensions have to be paid when due … so that new promise isn’t worth the paper it would be printed on.


  22. - Leave a Light on George - Thursday, Aug 15, 13 @ 12:02 pm:

    “No, it’s not possible to get a judicial opinion now. Courts don’t issue advisory opinions; they only rule on actual cases.”

    Agreed, but couldn’t the State Attorney General issue an advisory opinion on the diminishment clause to help guide the committee in its work? She’s not running for Gov. I hear.


  23. - Norseman - Thursday, Aug 15, 13 @ 12:04 pm:

    I still think there will be no final CC report until the court rules on the IV of the Solon salaries. So I believe they will be making “progress” for a long time.


  24. - Norseman - Thursday, Aug 15, 13 @ 12:06 pm:

    S.S. I hope so. However, all too many do set aside their oath for the sake of politics.


  25. - Bill White - Thursday, Aug 15, 13 @ 12:18 pm:

    I agree with Norseman, there won’t be a final CC report until the litigation regarding Quinn’s line veto is resolved.

    And because both sides can appeal, final resolution might not be until after the March primaries. Unless the IL SC chooses to fast track the process.


  26. - Cook County Commoner - Thursday, Aug 15, 13 @ 12:24 pm:

    Another aspect of this issue seems to be unfolding in California. From what I can tell, the federal Dept of Trans is holding up transportation dollars to certain California government units because legally passed pension reforms are being deemed to violate labor contracts. Do Illinois and its government units also have this Sword of Damocles hunging from above?


  27. - anon - Thursday, Aug 15, 13 @ 12:27 pm:

    What’s the point of an advisory opinion? It’s not like they aren’t fully aware that these plans are unconstitutional. It’s a political strategy to have the courts strike it down.


  28. - Mouthy - Thursday, Aug 15, 13 @ 12:27 pm:

    - RNUG - Thursday, Aug 15, 13 @ 11:00 am:
    “About the only legal way to diminish current pensions is to trick the retiree….”

    I’d take out the word legal and use a more harsher word than trick. Sen Cullerton’s bill is the one closest to that.


  29. - Federalist - Thursday, Aug 15, 13 @ 12:36 pm:

    Lest we forget the health insurance issue as related to retirees.

    I firmly believe that any objective person would concur that the “free health insurance’ is a protected right. After all, the IC mentions not only pension but also ‘retirement’ benefits. If it had only state pensions that that would be different but it didn’t. And when one has this insurance as a legal right when they were hired and still when they were retired then it strains credulity that this is not a diminishment.

    Yet, at the initial stage of the court process it has been ruled that there is no such right. Ummmm.

    Most interesting! Who knows, maybe final legislation won’t be passed until the SC settles this case to see how it turns out.


  30. - Bill White - Thursday, Aug 15, 13 @ 12:44 pm:

    I also agree with Federalist. Resolution of the pending case regarding retiree health insurance will tell us far more than “advisory opinions”


  31. - RNUG - Thursday, Aug 15, 13 @ 12:49 pm:

    Federalist / Bill,

    You forgot to add the health insurance ruling also stated there was NO contract at all on the health insurance … something almost everyone believes was an incorrect ruling.


  32. - Sir Reel - Thursday, Aug 15, 13 @ 1:00 pm:

    RNUG brings up a possibility that hasn’t gotten much discussion to date - for current workers, leaving benefits earned to date alone and changing the deal for future work. This wouldn’t save much but could pass the constitutionality test. This option would be most unfair to workers in the middle of their careers.


  33. - PublicServant - Thursday, Aug 15, 13 @ 1:07 pm:

    ===I think it’s coming down to how much savings is necessary to both protect what people have earned, and be affordable to future General Assemblies.===

    So, let me get this straight Bill Brady. You want to protect what people have earned through diminishment in order to achieve savings affordable enough for future legislatures? Wait. What?


  34. - Tsavo - Thursday, Aug 15, 13 @ 1:10 pm:

    Cook County Commoner,

    Thank you for your post, I had not heard of the California issue.

    http://www.sgvtribune.com/general-news/20130805/pension-reform-holds-up-22-billion-in-federal-transit-grants-to-metro


  35. - anon - Thursday, Aug 15, 13 @ 1:24 pm:

    @ Sir Reel, the caselaw in Illinois says otherwise. you are entitled to the pension scheme in place at the time of hire.


  36. - anon - Thursday, Aug 15, 13 @ 1:29 pm:

    Very interesting article about California. Making it even more inexplicable why the We Are One Illinois coalition was so eager to sell out its members by agreeing to the diminishments in the Cullerton plan. It would seem that the threat of reducing revenue by tying up federal funding would give them a lot of leverage in resisting pension cuts.


  37. - PublicServant - Thursday, Aug 15, 13 @ 1:43 pm:

    ===Making it even more inexplicable why the We Are One Illinois coalition was so eager to sell out its members…===

    When you’re a hostage, you’ll negotiate anything to avoid antagonizing your captor. The unions were being accused of stonewalling, so they decided to participate, the result of which was the SB 2404 bill that Madigan didn’t call. I hope that explains it for you Anon. Since any diminishment was going to be challenged anyway, its certainly logical to try to make the bill to be challenged as favorable as possible to its members. Of course, whatever the unions negotiated, they don’t speak for me as a retiree who was never in a union.


  38. - retired and fed up - Thursday, Aug 15, 13 @ 2:01 pm:

    The Constitution refers to membership in a pension plan, the benefits of which shall not be diminished. Once you start to make your pension payments you are a member in the plan so any changes for current employees paying in are probably unconstitutional also


  39. - Demoralized - Thursday, Aug 15, 13 @ 2:01 pm:

    I think to stomp our feet and claim any effort at pension reform is automatically unconstitutional avoids reality. It’s clear that everybody is a constitutional lawyer apparently. But I wouldn’t bet one dime on the state Supreme Court agreeing with those on here that claim that any change to the pension is unconstitutional. I think we need to try to get the best deal we can get that causes the least amount of pain to those of us in the system.


  40. - retired and fed up - Thursday, Aug 15, 13 @ 2:04 pm:

    I am a retired attorney and aced my con law classes, but you don’t have to be an attorney to understand that taking something away is a diminishment.


  41. - Bill White - Thursday, Aug 15, 13 @ 2:05 pm:

    Regarding the CA issue, is that $2.2 billion per year in federal money?

    Losing even $1 billion per year in federal money (over 30 or 40 or 50 years) ends up being a significant fraction of the unfunded pension obligation.

    I wonder if the pension reform committee is including this risk as part of the actuarial calculations?


  42. - PublicServant - Thursday, Aug 15, 13 @ 2:13 pm:

    @Demoralized-No foot stomping going on here. Nothing is automatic. I’m not sure who on here is a constitutional lawyer, and neither are you. I’m not, but I do have an opinion, and part of that opinion is that you really don’t need to be a constitutional lawyer to correctly interpret the plain language of the pension clause as written and rely on clear past decisions from the Illinois Supreme Court to inform the opinions that you see on this blog. I’m also not sure whether Eric Madiar is a “Constitutional” Lawyer, but a lawyer he is. Have you read his paper? It essentially agrees with the opinions of those non-constitutional lawyers referencing the unconstitutionality of the “solutions” that have been proposed thus far. I believe that its you and others who refuse to even weigh the constitutionality of the current crop of bills who are ignoring reality…and wasting time.


  43. - Algonquin J. Calhoun - Thursday, Aug 15, 13 @ 2:19 pm:

    PublicServant -

    +1. I’ll fess up - I’m a contracts lawyer (though I’ll admit I only got a “B” in Con Law). I’m convinced that even if the ISC *somehow* upholds a diminishment, we’ll win under the contracts clause of the U.S. Constitution (Art. 1, Sec. 10, Cl. 1).

    Plus - I don’t understand the thinking of “well, if we give in a bit now, they’ll leave us alone in the future.” I believe quite the opposite would take place - “they’ll” continue the diminishment as far as they can get away with it.


  44. - PublicServant - Thursday, Aug 15, 13 @ 2:29 pm:

    Algonquinn-I’d have given you an A. You didn’t have one of those Federalist Society guys as your prof did you? Wouldn’t a decision have to come on diminishment from the Illinois Supremes first before it could be appealed to the feds for a violation of the U.S. Contracts Clause?

    And, you’re absolutely right about the “give an inch, and they’ll take a mile” argument, and Demoralized should consider that while advocating negotiation.


  45. - Norseman - Thursday, Aug 15, 13 @ 2:31 pm:

    Demoralized, what is your reality? Evidently you are a closet constitutional lawyer yourself because you clearly have taken a position that the courts will rule in favor of a pension reduction plan.

    I’m happy for you that you’re capable of negotiating a bill that addresses your needs. Frankly, nobody is beating my door down to offer up a chair at the table. Nobody is beating the door down of the retirement organization I belong to, to work out a compromise. Clearly, the only group that did have the clout and accepted legitimacy to have a seat at ONE leader’s table came up with a compromise that didn’t bring enough pain to us.

    While you’re content with what they want to do to you and your family, I’m not. I’m also of the belief that if successful, this will not be the first time the benefits will be reduced. Public workers will be an easy target for the politicians who want money for programs and projects more politically important to them.

    Those of us who can read the constitution, the court cases and the legal articles written about the subject have a right to an opinion. Your efforts to denigrate us because you have a contrary opinion is ridiculous. As you have correctly stated before, the courts will be the final arbiter of whether you’re right, our side is right or a combination of both. So sit back Demoralized and enjoy your ride. I for one intend to continue to shout out my opposition to this travesty.


  46. - retired and fed up - Thursday, Aug 15, 13 @ 2:32 pm:

    Algonquin, I agree with you about the contracts clause of the U.S. Constitution so even if the ISC plays politics, which I don’t anticipate will happen, I don’t see games being played in federal court. However, I only got a B in Contracts.


  47. - PublicServant - Thursday, Aug 15, 13 @ 2:44 pm:

    Right is right, even if everyone is against it, and wrong is wrong, even if everyone is for it.

    William Penn-1644


  48. - anon - Thursday, Aug 15, 13 @ 2:52 pm:

    It is telling when the only argument advanced FOR the constitutionality of the proposals is the contention that the fix may be in on the courts. Why wouldn’t you just let your opponent take a Hail Mary pass instead of forfeiting the game?


  49. - PublicServant - Thursday, Aug 15, 13 @ 3:23 pm:

    @Anon-Because sometimes Hail Mary passes are successful? And why is fighting against an unjust, albeit convenient, political travesty forfeiting the game? I don’t want to see it go to the courts because there’s always a risk regardless of how small I think it may be, and I’ll try my hardest to convince as many lawmakers as I can to vote against a bill that I argue is clearly detrimental to their long term interests before that bill is passed.


  50. - Proud - Thursday, Aug 15, 13 @ 3:26 pm:

    I noticed nobody wants to comment on my earlier post. I will state it more succinctly. Is it “lawful” for the ISC to guaruntee the pension for public emplyees as a right in the state of illinois but if my Private company employer wants to end the pension (which they did) and go to a 401K, I am not protected equally under the ISC.


  51. - PublicServant - Thursday, Aug 15, 13 @ 3:40 pm:

    Proud, I’m sorry that the terms of your pension were changed, but your private company was not specifically prevented from changing those terms by the Illinois Constitution. Public employee pensions have that constitutional, and contractual protection. The ISC isn’t in the business of guarenteeing anything. They’re in the business of making sure laws don’t violate the state constitution. Given an opportunity to give private pensions the same protections as the 1970 con-con gave to my public pension, I would have voted to protect yours too. Unfortunately for you, our elected representatives apparently didn’t opt to do that. The injustice that was inflicted upon you, I sure, makes you miserable. And I know that misery loves company. Just don’t expect to see me at your party.


  52. - anon - Thursday, Aug 15, 13 @ 3:42 pm:

    A Hail Mary pass has by definition an extremely small risk of succeeding. I saw some calculations that the concessions made by We Are One would amount to something like 20% of the total pension payout due to the COLA freeze, salary caps, etc. Way too high a price to pay for a small risk. And, as many have pointed out, no reason to think that this concession would be the last. In a related topic, why should the unions care if they appear to be “stonewalling?” Union officials aren’t running for public office. They are elected to represent their members. I think Karen Lewis for one has spoken pointedly on that topic.


  53. - retired and fed up - Thursday, Aug 15, 13 @ 3:48 pm:

    The Constitution gives certain rights to individuals and controls what the government,not private citizens, can do. For instance the right against unreasonable search and seizure applies to law enforcement officers not to private citizens.


  54. - Anon III - Thursday, Aug 15, 13 @ 3:53 pm:

    Proud - @ 3:26 pm: “… Is it “lawful” for the ISC to guaruntee the pension for public emplyees as a right in the state of illinois but if my Private company employer wants to end the pension (which they did) and go to a 401K, I am not protected equally under the ISC.”

    I also did not ace my con-law course, but in decades of reading ISC opinions since then, I have noted that the ISC tends to say in many different cases, that the provisions of the Illinois Constitution mean the same thing as similar provisions of the U.S. Constitution. So there is going to be room to say that if your private employer can make changes in a pension contract, so can the State.

    It makes sense if you consider that we have a national economy and a national market for labor. It would interfere with interstate commerce to say that in one jurisdiction, one employer could not deal with economic realities.


  55. - Proud - Thursday, Aug 15, 13 @ 3:55 pm:

    Public Servant, I am not questioning weather we should all have pensions, I am questioning how can the constituion of the people of Illinois have clauses that dont apply to the people of Illinois, only a subset. So if we have another con con, it would be ok to say only red headed citizens are protected from murder because we put it in there? Retired and fed up I am pretty sure we all have a right to not be subject to unreasonable search and seizure. BTW, I think the current retirees and state employees should get what was promised to them. But going forward for all new Public employees, we should go to 401K like the rest of the state/country has outside of the govt sector.


  56. - PublicServant - Thursday, Aug 15, 13 @ 3:56 pm:

    Appearances are everything Anon. The unions wanted to appear to be a reasonable partner with the legislature in dealing with a problem facing the state. Blunting animosity towards the unions by the public is a reasonable goal. Blunting even more punitive measures under consideration by the legislature was a reasonable goal too. As for 20%, if you know any diminishment is, as you say, a Hail Mary, then why not negotiate whatever percentage, thus being a willing negotiating partner, while knowing full well that the Supremes almost certainly have your back? I don’t blame them at all for taking away the excuse being used by some legislators that the unions weren’t cooperating, thus garnering more public support for their more punitive position.


  57. - titan - Thursday, Aug 15, 13 @ 4:09 pm:

    Proud - are you being deliberately obtuse there? The consitutition provision controls public pensions (provided by the state/public government and funded with state/public money). It doesn’t deal with private pensions - which aren’t state/public provided or funded. They are qualitiatively different things, so different treatment is permissible.


  58. - PublicServant - Thursday, Aug 15, 13 @ 4:14 pm:

    Proud, I know nothing of the specifics regarding the issues dealing your pension. I’ll let the “constitutional” lawyers, or someone more well versed in the law than I am answer your question. I hope they will. However, if you’re saying that the clause protecting public pensions is somehow unconstitutional because it just protects public employee pensions and not all pensions, well, get some money together and a good lawyer, bring a lawsuit, and get it overturned. Good luck with that. Please let me know how it goes. Until then, I’m pretty sure that clause will withstand any challenge.


  59. - anon - Thursday, Aug 15, 13 @ 4:14 pm:

    @Proud, one of the reasons for the Contract Clause and the similar pension diminishment clause is to prevent the legislative branch from abusing its powers. A company can’t vote away its debts. A bad business decision does not have the force of law. However, but for the constititonal restrictions, a legislature might just be tempted to abuse its powers and ignore its debts. Which is basically exactly what is going on here with the pension schemes.


  60. - Anon. - Thursday, Aug 15, 13 @ 4:24 pm:

    Proud — you had contract and ERISSA rights in your old pension. What’s more, your employer was required by ERISSA to properly fund your old pension, and could not take that funding back. When they changed to a 401(k), they had to transfer that funding to the new plan for your benefit. So the equivalent treatment of state employees would be that the state can do what they want for the future, but they have to fully fund the retirement systems’ current liabilities and leave that money in trust for the retirees and current vested employees. Since it’s coughing up the $100 billion underfunding that is causing all the screaming, giving the state employees the same deal you got is a major problem.

    The difference between your situation and state employees’ is that whatever contractual rights you had to continue the old pension plan could have been voided by the employer in bankruptcy, while (if you believe the ILSC cases out there already), state employees have a contractual right to continue with their current plan and the state cannot get out of it by bankruptcy. That is a huge advantage, but, again, that has to do with earning future benefits and the issue here is the state’s unwillingness to pay what is already owed.


  61. - foster brooks - Thursday, Aug 15, 13 @ 8:48 pm:

    anon is correct, there is NO difference between a retiree and an active worker


  62. - PublicServant - Friday, Aug 16, 13 @ 6:29 am:

    Foster, I hate to break it to you but financially speaking, most retirees don’t have a job, and given the sorry state of the economy, they can’t get one to mitigate the destruction of their meager pension over time. There’s only so many positions available for Walmart greeters. The difference between a retiree and a current retiree is time to mitigate whatever injustice is visited upon them, and the more time a current employee has left, the more time they have to adjust their retirement plans.

    Don’t get me wrong, I’m not selling out current employees at all. Just stating the facts. There are quite a few big differences between retirees and active workers. However, there are also a lot of similarities, the major one being that since we’ve all been lumped together as a bunch of high flying, or soon-to-be high flying “takers”, vacationing in Maui on our yachts, we’ve got to stick together, because divide and conquer is central to the strategy being employed by the “Bruce Rauner” bunch out there, with Bruce being a taker whose take we greedy state employees can only dream of acheiving.


  63. - PublicServant - Friday, Aug 16, 13 @ 6:31 am:

    Sorry meant “the difference between a retiree and a current employee” above.


  64. - Proud - Friday, Aug 16, 13 @ 9:22 am:

    Everybody has made wonderfully valued points. I again feel that all current retirees as well as current govt employees should get the pension that was promised them. I am saying though it is a business model that cant be sustained going forward.


  65. - PublicServant - Friday, Aug 16, 13 @ 9:27 am:

    I am saying you’re wrong, Proud, since the pensions have been underfunded for some nigh-on 70 years and have never missed a payment. But I’m curious as to where you get your information as to what can or can’t be sustained going forward.


  66. - Saint Crispin - Friday, Aug 16, 13 @ 9:45 am:

    I’ve been following the pension debate closely,and I find it fascinating that there doesn’t seem to be any conversation, or hard data, about whether the pension systems are actuarialy viable. We all know the state hasn’t made payments when it should, but after digging into the TRS situation pretty far it seems that, most likely, even if the state had made all its payments on time,the system would still be only 70% funded (more or less).

    And before anybody labels me anti-pension, I’m truly not. I’m just trying to understand the finances. For the TRS, and I assume the other systems, this is a story about the time value of money and the trap of compounding interest(debt). Over the least 30 years Illinois has made its full normal payments for all but 6 years where it made partials. Where it fell down is by not paying enough into the fund to stop the interest debt from increasing. That said, If you go by the COGFA reports a good percentage of the UL is for actuarial and benefit reasons. Can’t blame the state for that.

    So my question for the pension system members here is: assuming the state made up all the unmade contributions and interest, if the system was still underfunded, is it reasonable for you all to make some reasonable concessions, especially in light of the fact that paying back the interest will be a huge challenge for the state?


  67. - Juvenal - Friday, Aug 16, 13 @ 2:12 pm:

    The Court majority has a track record of politically unpopular decisions in favor of upholding the rule of law.

    And make no mistake, nothing that finds its way to the Supreme Court will be politically popular.

    As for the minority, you’ve got two with huge numbers of public employees in their districts and a third who is a former member of the NFL players association and knows a thing or two about contracts.


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