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* From a Tribune editorial on House Speaker Michael Madigan and, of course, pensions…
The Capitol he entered in 1971, like the state it governed, was muscular and robust. […]
Madigan’s reaction is to lament, as would a victim, the crises he helped cause — and has the influence to solve. At the federal level, the senatorial Gang of Eight works to avoid a fiscal cliff, and presidential candidates clash over debt. In Illinois, Madigan and his fellow leaders haven’t had significant talks about their pension debacle in months.
* The Tribune really needs to bone up on its Illinois history, at least regarding pensions. Here’s a chart showing the pension systems based on percent they were funded from 1968 through 2011…
You can click the pic for a larger image. If you still can’t see the funding ratio for the early seventies, here you go…
So, in 1971, right as Madigan took office, the pension systems were being blatantly ignored.
Now, that’s not to say that other aspects of the state budget were worse then than they are now. It’s just that the Tribune has always acted as if this pension funding problem is somehow new. It’s not. As I’ve told you before, this problem goes back more than half a century.
posted by Rich Miller
Monday, Oct 15, 12 @ 1:42 pm
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Hey Rich,
Who gave you the chart? Your rapid response defense of MM are becomming more and more of a concern. These one dimensional stats don’t explain away all the “sweet heart” single interest/person beneficiary provisions that are found in all of those pension bills highlighted in recent news stories.
Comment by Fair Share Monday, Oct 15, 12 @ 1:51 pm
===Who gave you the chart? ===
The chart is available online for anybody who looks for it. Google is your friend, my unfriend.
===These one dimensional stats don’t explain away all the “sweet heart” single interest/person beneficiary provisions that are found in all of those pension bills highlighted in recent news stories. ===
And those provisions don’t even begin to explain the real problem with pensions.
As to your other point…
Bite me.
Comment by Rich Miller Monday, Oct 15, 12 @ 1:55 pm
Given the plethora of information about the pensions, I’m sure it’s not hard to find a chart. The point here is not so much a defense of MM, but to highlight the Trib playing loose and fast with the facts.
Comment by Norseman Monday, Oct 15, 12 @ 1:56 pm
Hey Mr/Ms FairShare most of the special pension windows opened over the years were done in 5 way agreement that included a governor signing a bill
Tribbies really got upset when Madigan put their “pristine” name on the charts for the Blagoof impeachment hearings and trial. Those where the days when they were looking for the $100 million hand out for Wrigley then they put five guys plowing through all the tax appeals only to find zip, zero, nada
Now they just spew slop and garbage on all topics.
Makes you wonder if they are this wrong on Madigan how far off are they on all their other causes?
Comment by CircularFiringSquad Monday, Oct 15, 12 @ 2:06 pm
That chart looks more like an indictment of the Bush administration’s handling of the economy than anything MM ever did. Funding fell from 74.7% in 2000 to less that 40% in 2009? Looks like my 401(k).
1971 is also the year the constitutional guarantee went into effect.
Comment by maddem Monday, Oct 15, 12 @ 2:16 pm
=”The Tribune really needs to bone up on its Illinois history”=
The Tribune really needs to bone up on its ethics, integrity, and sanity.
It’s hard to believe they inadvertently overlooked decades of Illinois history when they did an article on Illinois history. - What a bunch of lowlifes.
Comment by Crime Fighter Monday, Oct 15, 12 @ 2:16 pm
Those big jumps - are those due to bond issuances to bolster the pension funds?
The big drops seem to coincide with the internet bubble bursting and the Enron/Tyco/WorldCom debacle and then with the financial crisis.
We’re at the lower end by historic norms, but not exactly at rock bottom.
A persistent pension funding problem over 50 years. And the systems are still going? Seems to me that this ‘problem’ is not such a big problem. A cynic might think that this is a manufactured crisis, and that it’s really more about stripping public employees of a big chunk of their compensation rather than a legitimate concern about the long-term financial viability of the state.
But that would be mighty cynical.
Comment by jerry 101 Monday, Oct 15, 12 @ 2:21 pm
The IFT teachers’ union is recommending that its members vote for Madigan, and a lot of democrats running for state office, in the coming election. Now does that tell you why Madigan has not pushed pension reform. Unions and the democrats help each other, while not giving a damn about the state of Illinois!
Comment by Billy Monday, Oct 15, 12 @ 2:25 pm
I’d like to see an overlay with a chart of Tribune readership over the same period. That’s probably Madigan’s fault too.
Muscular and robust? I don’t think that means what the Tribune thinks it means.
Comment by 47th Ward Monday, Oct 15, 12 @ 2:27 pm
So, we’re to understand that Madigan has kind of had help wrecking Illinois pensions, bit that he has nearly alone over the past 40 odd years has learned to be the most comfortable with this disaster than other Illinois politicians, right?
How did he get to be a Speaker with these kinds of results? He won a raffle? Got a Willie Wonka Golden Ticket? Usually, well in other states and in other times, a speaker is chosen based on results like dealing with big problems.
So, I guess some folks want to give Madigan another 40 years to address this?
The pension disaster may be 50 years in the making, but it shouldn’t be considered rude to ask the guy in power where the hell he has been over the last forty, right?
What’s the point of giving someone all that power without asking him for a few results? In olden days that was called, “accountability”.
Comment by VanillaMan Monday, Oct 15, 12 @ 2:51 pm
Slightly off topic, but not too much: Today I saw a “Retired House of Rep” license plate on a Mercedes at Springfield fitness club. I wondered why in Gods name would someone think that was a good idea? Does he/she think they are worth praise? Are the plates Free?? Soooo Far out of touch. Why not a bullseye as well as the plate?
Comment by Anonymous Monday, Oct 15, 12 @ 3:14 pm
“That chart looks more like an indictment of the Bush administration’s handling of the economy than anything MM ever did.”
You can blame the Bush administration for a lot of things (and I do), but the screwed up state of the Illinois’ pension system ain’t one of them. This is a home grown mess.
Comment by wishbone Monday, Oct 15, 12 @ 3:29 pm
Does anyone out there remember Madigan and Rock passing 1986 budgets (spring of 1985) that “restored” pension funding to 100% of payout (Thompson had reduced it to 60% when interest rates were high late Carter / early Reagan, and never restored it when interest rates dropped)? Anyone remember Thompson item vetoing all retirement lines to get the appropriations back to 60% of payout?
Comment by Anyone Remember? Monday, Oct 15, 12 @ 3:29 pm
The Tribune’s constant bleating about the supposed all-powerful nature of Speaker Madison and how that power has been the root cause of the decline of State of Illinois is more than a bit tiresome. I suppose with Blago no longer on the scene they are just continuing where he left off in trashing the Speaker.
If the Speaker had as much power over the years as the Trib attributes to him, as the only adult in the room for much of the time I suspect the state would likely be in better shape than it is today.
The Trib’s talk of gerrymandering by the Democrats is also laughable. Are we to believe that if the Republicans had been in control they would selflessly adopted a completely neutral map?
Perhaps the Tribune may also wish to do an analysis of the effect of the legislative cutback amendment on the Speaker’s power. I recall from my (much) younger days before the cutback amendment, the House had a number of independent voices.
Comment by Just the Facts Monday, Oct 15, 12 @ 3:33 pm
You know, we have a pension challenge/problem. How big the problem/challenge is, is subject to debate but I doubt anyone would say things are good.
I don’t get how making Madigan the bad guy on this helps solve the problem.
If the Trib wants change on this (have to be somewhat happy a newspaper editorially is pushing for something in this town) it seems the focus should be on all the members, not just the speaker.
Comment by OneMan Monday, Oct 15, 12 @ 3:44 pm
The Tribune has become a joke: circulation falling, bankrupt model, a true second class operation. Like someone else said, they probably blame Madigan for that too. I think tomorrow they will have a story above the fold blaming Madigan for the Ambassador death in Libya..
Comment by NotRMiller Monday, Oct 15, 12 @ 4:00 pm
When the economy is down as it is now everyone is all gloom and doom about state funding and pension funding, and for a good reason. When the economy is down, unemployment is up and this means the state is paying out money for welfare and unemployment compensation while taking in less tax revenue.
Predictions of the state pension funds self destruction always turn out to be wrong when the economy recovers, as it will again. Really!
Comment by Ruby Monday, Oct 15, 12 @ 4:26 pm
The combination of the 94/95 funding deal and the stock market bolstered the funding levels then the markets tanked and Blago started the pension holidays- The problem now is that the investment returns have not mirrored the market recovery which began in March 2009 and the added ongoing benefit payments have dramatically increased at the same time State funding has been insufficent to even pay the cost of current benefits- what everyone on this Blog fails to acknowledge is that in addition to inadequate funding- the recent investment returns are not what they could be with better fund management- why with the State on the hook for any deficiencies is Illinois not insisting on more oversight- Since March 2009 the S&P has doubled but with TRS’(which is where the lion’s share of the funding problem rests) love affair with hedge Funds and other non-public investments, TRS’ returns are not coming close to matching the S&P- Solving the pension problem requires not only added funding but also enhancing the investment performance on the existing portfolios
Comment by Sue Monday, Oct 15, 12 @ 5:00 pm
So the conventional wisdom is it’s everybody’s fault and nobody’s fault. If you can’t pin a large share of blame on the highest of leadership, who do you blame it on?
Comment by Shemp Monday, Oct 15, 12 @ 5:03 pm
===who do you blame it on?===
I blame myself, and the millions of Illinoisans like me who wanted good government services but didn’t want to pay for them. Voters kept rewarding both parties for kicking the can down the road. We get the government we deserve.
Comment by 47th Ward Monday, Oct 15, 12 @ 5:13 pm
Madigan must look back at the carnage he helped cause,he been the one constent in the State.
He should sholder most of the blame. I feel he
is a proud man, and he just might wake up to the fact he’s the only guy who can fix things.
Quinn dosen’t have the right stuff to get the
job done.Cullerton may end up as the guy who
gets it right. I hope so.Our States in trouble.
Comment by mokenavince Monday, Oct 15, 12 @ 5:34 pm
Shemp-
Blame it on Big Jim Thompson and budget director Bob Mandeville?
Comment by Rather Be Golfing Monday, Oct 15, 12 @ 6:59 pm
Wishbone,
Bologna. The plunges on that chart starting in 2000 and 2007 is directly related to the stock market and the pension funds return on investment, way less to whatever MM and the GA did. MM came to the General Assembly in 1971. He did pretty good for his first 30 years; funding went from less than 40% to nearly 75%.
MM had nothing to do with my 401(k). It is now (thanks to Obama?) almost back to what it was when Clinton left office; in 2012 $$ it is still down 25%.
I agree with Jerry 101.
A cynic might think that this is a manufactured crisis, and that it’s really more about stripping public employees of a big chunk of their compensation rather than a legitimate concern about the long-term financial viability of the state.
Comment by maddem Monday, Oct 15, 12 @ 7:15 pm
“Wishbone, Bologna.”
Explain then why Iowa and Indiana (for example) who share the same national economy as Illinois are not facing the same pension crisis as our state? I said the problem was home grown, and no amount of buck passing to the feds can change that fact.
Comment by wishbone Monday, Oct 15, 12 @ 7:56 pm
I realize this post was about the Tribune blaming Madigan for the pension underfunding, but very few people may realize that the funding plan itself enacted in 1995 was woefully inadequate. The method used to amortize the unfunded liability utilized a method “level percent of pay” that over long periods of time would cause a negative amortization for repayment of the unfunded amounts. In other words, the now increasingly unsustainable payments are part of the plan crafted by the legislature and signed into law by then Governor Edgar. The payment plan was to allow for gradual increases in payments (the 10 year ramp) and then payments linked to projections of increases in payroll which does not even cover the interest costs until 2031, more than 35 years into the repayment plan. That means if all the assumptions played out as predicted with no large market fluctuations, the unfunded liability would continue to grow until 2031 with no progress made toward reducing it. The large fluctuations you see in the funding level are due to market volatility. An overall decrease in the funding level is due to pushing the “repayment so to speak” to the latter years of the 1995 – 2045 period. Source CoGFA.
Comment by Did the Math Monday, Oct 15, 12 @ 8:26 pm
It would be great if everyone would remember to refer to the organization in question as “the bankrupt Chicago Tribune”. They destroyed the future of their own employees and now are eager to destroy the futures of state retirees and employees.
If they had any sense, the Trib would concede Madigan’s role and campaign to change the House rules that give the Speaker too much control over bills that can be voted on by the people’s representatives.
Comment by DuPage Dave Monday, Oct 15, 12 @ 8:56 pm
If you ranked every House and Senate member beginning with those with no solutions who just want to whine about the other party, thru those with half-baked “sounds-good” proposals, up to those who are actively pushing real long-term solutions — you would find Madigan among the few at the top.
Madigan and others have been pushing for over a year, with the powers they do have, but so far not enough legislators are committed to closing the deal. The change-resisters, half-wits, and political barkers from both parties, are still too numerous.
Oh, BTW, another reminder that the man has real power, but is not all-powerful. If it were up to him alone, it would have been fixed already.
Comment by walkinfool Monday, Oct 15, 12 @ 9:06 pm
Really? Was it the $$? Really? Lighten up, man.
Comment by Jeff Trigg Monday, Oct 15, 12 @ 9:10 pm
Also courtesy of the Tribune. Lets see a chart for this.
“A study released this spring by the state’s Commission on Government Forecasting and Accountability found that of $64 billion in increased unfunded pension liability that built up from the 1996 through 2011 budget years, $28.4 billion was due to the failure of government to put enough money into the state’s five pension systems.”
Nope, Madigan is squeaky clean. Right?
Comment by Jeff Trigg Tuesday, Oct 16, 12 @ 12:07 am