* Alicia Munnell, the director of the Center for Retirement Research at Boston College, has written a new book called “State and Local Pensions: What Now?” Peter Orszag at Bloomberg takes a look…
Illinois, Kentucky and Pennsylvania face enormous gaps, while Delaware, Florida, North Carolina and Tennessee have managed their pension plans relatively well.
Why were some [pension] plans so badly underfunded and others not? Munnell’s answer is the biggest surprise in her analysis. She argues that neither the artificially high discount rate nor unions can explain the variation. As she concludes, “The poorly funded plans did not come close to surmounting the lower hurdle associated with a high discount rate; raising the hurdle is unlikely to have improved their behavior. And union strength simply did not show up as a statistically significant factor in any of the empirical analysis.”
The worst-funded plans were not especially generous in their benefits, Munnell found, which is consistent with her argument that union strength isn’t what matters. These plans, though, did tend to share two characteristics: They were disproportionately teachers’ plans, and they used a funding method (called the projected unit credit cost method) that is less stringent than those used by other plans.
The states with huge funding gaps have “behaved badly,” Munnell concludes. “They have either not made the required contributions or used inaccurate assumptions so that their contribution requirements are not meaningful.” She added, “Fiscal discipline simply appeared not to be part of the state’s culture.” [Emphasis added]
* That’s most certainly the case in Illinois, where adequate funding was never a serious concept.
Yet, you’d never know this by reading wannabe governor Bruce Rauner’s latest Tribune op-ed…
The most powerful political force in Illinois today, by far, is the government employee labor unions. They have contributed mightily to our state’s budgetary and economic chaos.
The bosses of American Federation of State, County and Municipal Employees; Service Employees International Union; and the Illinois Federation of Teachers/Illinois Education Association are in virtually every legislative meeting, every budget meeting, every policy meeting in Springfield. They take their taxpayer-funded, government-collected union dues and funnel them by the tens of millions to politicians in both political parties. They use their vast membership to supply patronage workers by the thousands for political campaigns throughout the state.
This has created a powerful closed-loop system, with these unions and politicians on the inside, and taxpayers and schoolchildren on the outside. It is a system that allows union bosses to bribe politicians with massive political support in exchange for salaries that are 23 percent higher than in our neighboring states, and even higher still than in the private sector, with stunningly generous pension benefits that allow government employees to retire with higher pay for the rest of their lives than they got while working.
Pensions aside, government salaries may be higher than neighboring states, but the cost of living here is also higher.
* Related…
* Lawsuit filed by Chicago Teachers Union, others seeks to overturn pension law: Pension reform in Illinois got a rare legislative victory when the General Assembly moved to close loopholes that allowed labor leaders to land six-figure public pensions based on their much higher union salaries. The measure, which deals with abuses exposed by the Tribune and WGN-TV, affects a small number of city workers on leaves of absence to work for their unions, and it passed with little dissent.
* Henry Bayer: Unions stand up for the middle class
In the TV ad, a narrator says Gill was fired for pushing “dangerous ideas, advocating unlawful medical practices and methods a hospital said would put lives in danger.”
Gill, an emergency-room physician in Bloomington, publicly supported physician-assisted suicide more than a decade ago. In one letter to the editor of The Pantagraph of Bloomington-Normal in February 1998, he said surveys at the time showed that 60 percent to 70 percent of Americans felt physician-assisted suicide should be legalized. He also said a law proposed in Illinois at the time had safeguards against “using physician-assisted suicide as anything other than merciful relief of the otherwise unavoidable agony that dying is for some patients.” […]
According to Pantagraph stories, Gill was scheduled to begin work at the OSF Medical Group in Clinton in January 1999 after leaving a family practice job in Morton. He was terminated before he began, and a spokeswoman for OSF Medical System said at the time it was because his December 1998 letter brought to light that Gill “embraces and advocates medical treatment methods that are unlawful in this state and that are not acceptable by community medical standards.”
OSF Healthcare also said that Gill damaged OSF’s reputation by publicizing viewpoints that contradicted the system’s Roman Catholic principles.
Gill sued and reached a settlement. He calls the ad “slanderous.” But I’m not sure why. Watch it yourself [Better version uploaded]…
Thursday, Nov 1, 2012 - Posted by Advertising Department
[The following is a paid advertisement.]
Cooperatives can be formed to support producers such as farmers, purchasers such as independent business owners, and consumers such as electric coops and credit unions. Their primary purpose is to meet members’ needs through affordable goods and services of high quality.
Cooperatives such as credit unions may look like other businesses in their operations and, like other businesses, can range in size. However, the cooperative structure is distinctively different regardless of size. As not-for-profit financial cooperatives, credit unions serve individuals with a common goal or interest.
They are owned and democratically controlled by the people who use their services. Their board of directors consists of unpaid volunteers, elected by and from the membership. Members are owners who pool funds to help other members. After expenses and reserve requirements are met, net revenue is returned to members via lower loan and higher savings rates, lower costs and fees for services.
It is the structure of credit unions, not their size or range of services that is the reason for their tax exempt status - and the reason why almost three million Illinois residents are among 95 million Americans who count on their local credit union everyday to reach their financial goals.
* I told subscribers weeks ago that Sports Facilities Authority board member Manny Sanchez was the problem behind the governor’s inability to name his own CEO. So, in classic old-school hardball style, Sanchez was just wacked…
In a stunning political maneuver, the Illinois Sports Facilities Authority elected former TV reporter and gubernatorial aide Kelly Kraft as its new CEO.
The vote came Thursday morning after board member Manny Sanchez, 64, was told he was being replaced because his term was up. Mr. Sanchez, a Chicago attorney, had indicated he was leaning toward voting for the candidate pushed by Mayor Rahm Emanuel to lead the entity that runs U.S. Cellular Field.
Gov. Pat Quinn named Dr. Quentin Young, an 89-year-old physician and Civil Rights activist who once chaired the department of medicine at Cook County Hospital to the board.
Mr. Sanchez declined to comment. According to the board, the vote was 4-3 in favor of Ms. Kraft. The other candidate was Diana Ferguson, a former CFO for Chicago Public Schools who had previously worked at Sara Lee Corp.
The vote followed a contentious exchange between board chairman Emil Jones and appointees of Mayor Rahm Emanuel, who said Kraft was not as qualified as a candidate the board had interviewed earlier in the day. That candidate, Diana Ferguson, is a former CFO for Chicago Public Schools and Sara Lee Corp.
As we all well remember, Jones has lots of experience with this sort of thing. But I hope he doesn’t need anything out of the mayor any time soon.
Bill Enyart, the Democratic nominee for the 12th Congressional District seat, on Wednesday continued to criticize GOP nominee Jason Plummer for claiming that Enyart and his wife, retired St. Clair County Circuit Judge Annette Eckert, were unethically taking advantage of state-funded pensions.
During a press conference outside his campaign headquarters in downtown Belleville, Enyart said it was “outrageous” that Plummer, in statements Tuesday, misidentified as a “pension” the $3,000 lump sum that Eckert had received upon the death of her mother, a retired public school teacher.
“And to call the death benefit that she received when her mother died a pension and an insider perk is outrageous,” Enyart said. “I find my opponent’s attacks against my wife particularly despicable because Mr. Plummer didn’t tell the truth and he made up facts to suit his agenda. He attacked my wife and my family for his own personal gain.”
In a teleconference for media members, Plummer had accused the couple of exploiting the taxpayer-funded pensions that Eckert paid into through her work as a Cook County assistant public defender in the late 1970s, as a part-time instructor at Southwestern Illinois College and as a judge who spent nearly 20 years on the St. Clair County bench.
* I wasn’t invited to join in on Plummer’s original teleconference where he made the allegations, but others were. Check out this nugget…
Plummer leveled his allegations during a conference call he ended after taking two questions from reporters.
Courage.
* Plummer has said that Mrs. Enyart’s pensions are an an example of “connected” people “gaming” the system. Hmm. Well, I’m sure he must be clean if he’s accusing others of such things. Let’s go back a couple of years…
Plummer, at 23, became Madison County Republican chairman in 2006 and served one two-year term, during which he opened an office for the organization in a strip mall owned by one of his family’s businesses. State records show the county GOP during his tenure paid more than $13,000 in rent to the family business and also had the party pay almost $500 for phone service to a firm in which Plummer was an investor. The headquarters was closed when he left the job.
* The Republicans threaten a lawsuit over the use of a logo…
In a sign that Election Day can’t come too soon now, the Republican National Committee has demanded that a local Democratic candidate for Congress stop breaking the law — by running a picture of its elephant logo.
Yes, folks, in a Beltway-made tempest in a teapot, the RNC wrote to Democrat Brad Schneider’s campaign and told him to “cease and desist” picturing the logo next to a shot of Robert Dold, Mr. Schneider’s opponent, in a new TV ad (below). Mr. Dold is, um, a Republican.
The latter, from RNC Associate Counsel Jon Waclawski, says it has come to his attention that the ad “displays (RNC’s) Official Elephant Logo without RNC permission.”
* Bob Dold sent out a franked mailer just under the limit, which causes Brad Schneider to freak out…
A taxpayer-funded mailer from U.S. Rep. Robert Dold touting job fairs he has hosted is hitting homes in the 10th Congressional District this week while striking a nerve with Dold’s Democratic rival.
Members of Congress are prohibited from sending out public mailings with 500 or more pieces during a 90-day window leading up to an election.
But Dold’s piece, which cost less than $250, falls under an exemption in congressional franking rules because it went out to 499 or fewer homes in his north suburban district.
“This doesn’t raise any red flags on our end,” said Steve Dutton, a spokesman for the House Franking Commission, whose members include Dutton’s boss, U.S. Rep. Aaron Schock (R-Ill.).
Still, Democrat Brad Schneider’s congressional campaign is crying foul, saying it’s improper for the Kenilworth Republican to send out the taxpayer-funded mailing alongside campaign mailers so close to the election.
* An outside group gets a big contribution from oil company, does an independent expenditure ad whacking Schneider, and Schneider complains about Dold, who had no involvement…
All of the big super PAC money that’s suddenly sloshing around this election cycle certainly poses some real questions about why certain interests are providing so much help to certain politicians.
But are things as bad as they appear, or more innocent? A political foul, or guilt by association?
Sometimes it’s hard to tell. Which leads to a real-life story about U.S. Rep. Dold, R-Winnetka, who frequently presents himself to voters as a pro-environment kind of guy, but who is being aided this week by a nearly $1 million “independent” TV ad buy funded by a group that has received a possibly record contribution from a big oil company.
Allies of [Rep. Skip Saviano] organized a phony “community forum” in the west suburbs last week. [Democratic challenger Kathleen Willis] went to defend her record. When she got there, she was ridiculed and attacked personally. But she had one key ally, Southwest Side Sen. Martin Sandoval (D-12th).
As soon as Sandoval got up to speak to defend Willis, the organizers tried to shout him down. Sandoval’s message was clear.
“The Republicans have never cared about the concerns of the Latino community. It’s the Democrats who have supported Hispanics,” Sandoval said over and over again.
The meeting erupted into confusion. Saviano’s activists tried to push Sandoval to stop talking. But he refused to budge. Sandoval is not called “El Cabello” for nothing.
* Best comment gets an invite to my election night party, co-hosted by Google and NBC5. Yesterday’s winner was Small Town Liberal, for his funny spoof of a famous “Goodfella’s” scene…
Now the guy’s got Luis as a partner. Any problems, he goes to Luis. Trouble with the bill? He can go to Luis. Trouble with the cops, deliveries, Madigan, he can call Luis. But now the guy’s gotta come up with Luis’ votes every election, no matter what. Business bad? “#@%! you, deliver them.” Oh, you had a fire? “#@%! you, deliver them.” Place got hit by lightning, huh? “#@%! you, deliver them.”
