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Daley hoping for Chicago pension help from a Gov. Pritzker

Monday, Sep 17, 2018

* Greg Hinz talks to Bill Daley about his plans if elected mayor

For instance, Daley said he’s going to count hard on J.B. Pritkzer—”I have no doubt he’s going to be our next governor”—to help the city deal with its huge pension debt, which already has forced up local taxes roughly $1 billion a year and could force another increase of that size by 2023, when the city is supposed to be at the actuarial funding level.

“If the city can’t address its pension plans and bring them to balance, the future of the state is 10 times bleaker,” Daley said. “I think (Pritzker) will work with the mayor to address the issue.”

Yet, he added, “It can’t all be on the taxpayers. Everyone has to have some skin in the game.” Included in is view is labor, despite an Illinois Supreme Court ruling that overruled a pain-sharing deal outgoing Mayor Rahm Emanuel bargained. Daley said he’d start by getting all parties together, and said a negotiated constitutional amendment like one Arizona used to weaken a pension clause similar to the one Illinois has is “always is a possibility.”

Similarly, balancing the city’s budget requires at least considering things such as a commuter tax and head tax, two idea pushed hard by political progressives. “I’m not putting anything off the table now.”

Pritzker has already piled up his spending plans so high that they already top $10 billion by my rough guesstimate. If Daley’s solution is a state bailout, it’s magic beans.

The Arizona model is not a bad idea, though. I even advocated for it over the weekend on Twitter. But it’s dangerous to get too far out in front of any talks with unilateral public demands.

…Adding… This…



* Related…

* Cook County Board President Toni Preckwinkle to announce run for Chicago mayor this week

* Bill Daley on bid to replace Emanuel: ‘To be mayor, that would be the greatest’: “And you know, at this stage of my life, this is what I’d like to do for maybe the next four to maybe eight years. If people don’t accept it, I think I’ve had a great life. I’m lucky. But to be mayor, that would be the greatest,” he said.

* ‘I’m not going to change my name’: Bill Daley on why he’s seeking to become family’s third Chicago mayor: “The state of Illinois is great. They had a lot of problems, and I thought I might be able to bring something there, but this is home. This is where I live, this is where I’ve lived and this is where I’ll die,” Daley said. “That’s the difference. I’ve seen my father and brother try to lead this city, the difficulties of it, but the joy they got of trying to make a difference and help people. And the people of Chicago have been extremely good and kind to our family.

* Bill Daley ‘Excited’ for Mayoral Run He Calls Opportunity of a Lifetime: Some political experts have pointed to the Daley legacy as either a strength or a hindrance to his candidacy, but the freshly minted candidate is hopeful that voters will give him a chance to prove that he is just as capable of running the city as his famous family members.

* With Bill Daley running for mayor, it’s good to remember what happened the last time we turned Chicago over to the Daleys: Rahm made about $6.5 million as an investment banker in 2001, the year he helped broker that deal. As for Rauner, his company sold SecurityLink for about $1 billion, roughly six months after it was acquired for about $500 million. So Rauner owes a portion of his fortune to a couple of Democrats named Emanuel and Daley—something to remember the next time you hear Rauner raging against the machine.

- Posted by Rich Miller        

46 Comments
  1. - Sue - Monday, Sep 17, 18 @ 1:28 pm:

    Anyone believing in pension reform which involves beneficiaries taking a haircut isn’t worthy of being elected. Been there- done that. Even if every Union were to agree- you get union members filing lawsuits and we already know where that ends up. Skin in the game? What is he talking about


  2. - AnonymousOne - Monday, Sep 17, 18 @ 1:31 pm:

    Pain sharing is only that IF labor didn’t have to not only take a haircut but also pay the higher taxes. Otherwise, there is far more pain being felt (through no fault of their own) by labor.

    Always love the distinction between pension participants and taxpayers as if those with pension plans don’t pay taxes. Don’t they wish…….


  3. - Lucky Pierre - Monday, Sep 17, 18 @ 1:31 pm:

    Math, the pensions are unsustainable and payments will get much higher.

    Until the government unions realize the math is so bleak that there will be massive layoffs and privatization there will be no reform.

    Democrats are ignoring the problem because there is a Republican Governor


  4. - Just Me - Monday, Sep 17, 18 @ 1:36 pm:

    Progressives love to come up with ideas to generate more tax money. Just one — JUST ONCE - -I’d like to see them suggest a way to reform government and reduce spending.


  5. - Responsa - Monday, Sep 17, 18 @ 1:38 pm:

    ==For instance, Daley said he’s going to count hard on J.B. Pritkzer—”I have no doubt he’s going to be our next governor”—to help the city deal with its huge pension debt, which already has forced up local taxes roughly $1 billion a year and could force another increase of that size by 2023, when the city is supposed to be at the actuarial funding level.==

    Heh, I wonder if Bill has clued JB in on this expectation/obligation.


  6. - AnonymousOne - Monday, Sep 17, 18 @ 1:39 pm:

    After reading today that 57% of all Americans have no money in retirement savings……..gee, I don’t know. Defined Benefits plans seems like they should be reinstated for everyone. Forced savings from the paycheck every paycheck! Oh, wait, that’s not the problem with DB plans.

    Employers can’t help but help themselves to the kitty.


  7. - Stuntman Bob's Brother - Monday, Sep 17, 18 @ 1:39 pm:

    Pritzker, Madigan, Cullerton, and another Daley. If that isn’t Beelzebub’s Dream Team, I don’t know what is. Moving to Indiana, Wisconsin, Iowa or Missouri wouldn’t be far enough, folks from IL would be crossing the borders nightly to hold up gas stations in neighboring states in order to feed their families.


  8. - wordslinger - Monday, Sep 17, 18 @ 1:41 pm:

    Keep in mind Bill Daley publicly supported Rauner for governor four years ago after Pat Quinn scared him out of the Dem primary.

    He sure ain’t doing Pritzker any favors right now with talk out-of-nowhere of a state bailout of Chicago pensions.

    I imagine he knows that.


  9. - Reality Check - Monday, Sep 17, 18 @ 1:44 pm:

    Bill Daley may not be smarter than that, but you are, Rich. What’s been earned has been earned, what’s owed is owed, and a constitutional amendment doesn’t change that. As I, RNUG and others have said here before, you can’t make an ex post facto law to reduce the unfunded liability, constitution or no.


  10. - Anonymous - Monday, Sep 17, 18 @ 1:44 pm:

    “Beelzebub’s Dream Team”

    Rolling chuckle material.


  11. - Roman - Monday, Sep 17, 18 @ 1:45 pm:

    I can see Pritzker pushing through some enabling legislation to make it easier for the Chicago city council to raise sales and property taxes (or even create new taxes) on their own to pay off pension debt — but new cash from Springfield? No.

    And an “agreed to” constitutional amendment is a stretch, too. Don’t see the unions going for it and even if they did, the US Constitution’s contract clause is a real impediment to retroactively reducing benifits and ultimately saving the state any money.


  12. - @misterjayem - Monday, Sep 17, 18 @ 1:51 pm:

    “If that isn’t Beelzebub’s Dream Team, I don’t know what is.”

    Your brother should’ve told you to wear a helmet.

    – MrJM


  13. - Texas Red - Monday, Sep 17, 18 @ 1:51 pm:

    “Daley said he’s going to count hard on J.B. Pritkzer”

    Not enough money in Chicago to fix their own pension problems ? No problem use single party rule to spread the pain around. If elected Daley/Pritkzer will fix the problem via taxpayers. If for no other reason than this folks should consider voting for Rauner.


  14. - City Zen - Monday, Sep 17, 18 @ 1:53 pm:

    Maybe JB will rollover all Chicago employees onto the undoubtedly generous Hyatt pension plan.


  15. - OneMan - Monday, Sep 17, 18 @ 1:53 pm:

    Yeah, Illinois bails out the Chicago pension systems, that will play well in the rest of the state.

    I can see the 2020 re-map now, all the districts are a mile wide and go entirely down the state like a strange bar graph. My district goes from the Hyde Park to Metropolis.


  16. - Roman - Monday, Sep 17, 18 @ 1:57 pm:

    == Democrats are ignoring the problem because there is a Republican Governor ==

    Lucky, a brief history: Dems passed a benefit-slashing pension reform bill (that all their union allies were dead set against) before Bruce Rauner got to town. Interestingly, a majority of Republicans in the House voted against it. It was declared unconstitutional by the Supreme Court, unanimously.


  17. - Lucky Pierre - Monday, Sep 17, 18 @ 2:02 pm:

    What have the Springfield Democrats done to fix pensions since a Republican Governor was elected Roman?

    Zip zero nada


  18. - California Guy - Monday, Sep 17, 18 @ 2:05 pm:

    There was mutual agreement and good faith bargaining that led to the Arizona deal. Come to Illinois and unions are placing such offensive negotiations on par with homicide and kidnapping. Taxes have already went up and will probably continue to go up. Labor has to give something. Labor has to see it. Maybe they’re just buying as much time as possible. Eventually, they will give something.


  19. - Demoralized - Monday, Sep 17, 18 @ 2:06 pm:

    ==Democrats are ignoring the problem because there is a Republican Governor==

    Oh please. Your victimhood knows no bounds. The Democrats pushed through the most massive change in the pension plan several years ago when they did Tier II. But that’s not good enough for some of you. What you’re really after is reducing pensions for current workers. The Court has said you can’t do that but you won’t take no for an answer. You’re like a little kid who pouts because he can’t get his way.


  20. - Ole' Nelson - Monday, Sep 17, 18 @ 2:08 pm:

    Roman
    Facts have no place in an ideological rant. If so we would also point out that some of the most expensive enhancements to pension benefits have come under Republican Governors. Don’t try to burden Lucky down with facts. /s


  21. - Jibba - Monday, Sep 17, 18 @ 2:11 pm:

    Cal Guy…for the billionth time, the pension is an individual right. Neither unions nor anyone else has standing or ability to negotiate a change of any type.


  22. - Thomas Paine - Monday, Sep 17, 18 @ 2:19 pm:

    A grand bargain that ties an income tax amendment to rollback of pension benefits is doomed. Doomed.

    Its called “The Rauner Plan”, and it failed to gain public support for four years.

    Only 17% of voters support a measure that raises taxes while slashing union benefits.


  23. - Anonymous - Monday, Sep 17, 18 @ 2:21 pm:

    Just Me @1:36: David Orr, who is retiring this year as County Clerk in (gasp) Cook Country and has impeccable progressive credentials, cut spending at his office throughout his tenure.

    You’re welcome.


  24. - Arthur Andersen - Monday, Sep 17, 18 @ 2:28 pm:

    Way to sling JB under the bus, Bill. Any guesses on how quickly he folds his tent this time?


  25. - BenFolds5 - Monday, Sep 17, 18 @ 2:29 pm:

    Keep in mind Bill Daley publicly supported Rauner for governor four years ago after Pat Quinn scared him out of the Dem primary.

    He sure ain’t doing Pritzker any favors right now with talk out-of-nowhere of a state bailout of Chicago pensions.

    I imagine he knows that.

    Wow… This is next level stuff. This is what set’s apart Daley from the field. Promise all and everything to his voters and snuff out JB. There has to be someone in the media to ask JB what his thoughts are on this? May get ugly!


  26. - Anonymous - Monday, Sep 17, 18 @ 2:36 pm:

    Maybe a soda tax?


  27. - SSL - Monday, Sep 17, 18 @ 2:37 pm:

    There are many ways things can play out over the next 25 years. Walking the tightrope of fiscally preserving the state while not causing increased exodus is the challenge.

    Sadly, the current leadership doesn’t have the required skill set, so it is going to get ugly. I feel for those that are truly trapped in this mess.

    Chicago should start looking at bankruptcy. Sure it will hurt, but what else can you do? It is going to be necessary.

    Illinois will be forced to band aid as best it can, with the hope that federal laws allowing states to declare bankruptcy are loosened. Fiscally responsible states aren’t going to look favorably upon a federal bail out for disasters like Illinois.


  28. - Lucky Pierre - Monday, Sep 17, 18 @ 2:38 pm:

    Bill Daley is actually talking about the fiscal realities in Illinois and Chicago. This is like touching the third rail for progressives who see Illinois taxpayers as an ATM for all of their “free” Agenda.

    JB is beatboxing and dodging editorial board meetings and debates.


  29. - Rich Miller - Monday, Sep 17, 18 @ 2:39 pm:

    ===dodging editorial board meetings===

    As far as I know, he skipped just one ed board meeting.


  30. - Oswego Willy - Monday, Sep 17, 18 @ 2:42 pm:

    ===dodging editorial board meetings===

    Meh.

    The Trib Edit Board doesn’t count. They are like Proft papers, just older with better office space.


  31. - City Zen - Monday, Sep 17, 18 @ 2:47 pm:

    ==Only 17% of voters support a measure that raises taxes while slashing union benefits.==

    This was an actual poll question?


  32. - JB13 - Monday, Sep 17, 18 @ 2:48 pm:

    If Daley was dead in the water before, he just detonated a depth charge under his own boat. “Skin in the game…” “Shared pain…” “Not just on the taxpayers…” Hoo, boy, I can’t stop laughing. Someone hasn’t been paying attention.


  33. - California Guy - Monday, Sep 17, 18 @ 2:54 pm:

    @ Jibba

    Only way to find out if that holds up is to negotiate a pension clause amendment that both sides agree to and promote. If it ends up in court, deal with it on the State level first. All else fails, turn to Federal court where a conservative-majority SCOTUS would likely find a way to make it happen given the similar pension hardships around the country. Underfunded pensions are big national issue now.

    Though I would actually agree with your line of thinking, I’d like to think the courts will find a way. At this point, why not just try it?


  34. - Jibba - Monday, Sep 17, 18 @ 3:11 pm:

    CG…a constitutional amendment is a different story. But see RNUG and others for discussion of other federal laws that prevent theft of accrued benefits. I can see being able to alter future benefits not already earned if an amendment is passed, but that is not the lion’s share of the pension debt.


  35. - Roman - Monday, Sep 17, 18 @ 3:13 pm:

    == What have the Springfield Democrats done to fix pensions since a Republican Governor was elected Roman? ==

    About as much as Rauner has.

    Reminder: Rauner’s proposal on pension reform is to adopt Cullerton’s pension reform proposal. Cullerton, for those of you keeping score at home, is a Democrat.


  36. - Steve - Monday, Sep 17, 18 @ 3:23 pm:

    What’s left out of all of this is everyone is assuming there will not be a recession in the next 36 months, which is quite possible.


  37. - RNUG - Monday, Sep 17, 18 @ 3:24 pm:

    == Chicago should start looking at bankruptcy. ==

    Illinois’ municipalities can’t declare bankruptcy without the permission of the State. Not likely since the majority of the wealth is in Chicago.


  38. - Just A Dude - Monday, Sep 17, 18 @ 3:24 pm:

    CAL GUY: The courts did find a way, pay the debt. All the BK posters will never be satisfied until your stepping over homeless state employee/retirees on the street. Even if an Arizona model is somehow agreed to it would not be enough for some of you. Even Detroit public pensioners “only” took a 4% haircut for some of the highest pension earners. Well heck,that’s just not harsh enough. No fun at all.


  39. - RNUG - Monday, Sep 17, 18 @ 3:45 pm:

    Like it or not, the authors the Illinois Pension Protection Clause were brillant the way they phrased it.

    The first part declares the pensions to be a contract, no ifs, ands or buts; that puts it under the protection of both State and Federal Contract Law. Any changes must conform to existing contract modification methods, i.e., mutually agreed to by both parties, in other words, the consideration model.

    This comes even before the modifying phrase that benefits can not be diminished or impaired, which the IL SC has repeatedly stated is pretty much cast in stone.

    The only potential way you get around this would be to try to carve out an exception for State government. That has been done in terms of a few employment laws where the State was the employer.

    But those exceptions did not affect or modify contracts. If you try to carve out a loophole for State government to retroactively void a contract, you are undermining the building block of business, contracts.

    I just don’t see it happening, even with a solidly conservative / pro-business SCOTUS.


  40. - Oswego Willy - Monday, Sep 17, 18 @ 3:48 pm:

    ===Yep, best bet seems to be negotiate pension and graduated income tax amendments, pass enabling legislation for both effective upon ratification, and make the case to voters in 2020.===

    This is the best political play, if it is Governor Pritzker in 2019.

    Really solid tweet there. OW

    To Bill Daley, and the Post,

    There’s not a lacking. There is a hanging of the bad policy thought by Daley onto Pritzker… as Daley “sees” a Governor Pritzker can be outside regular pressures, and with Rauner, that helps no one, at times, and Daley picked Rauner already in 2014, as it’s been pointed out.

    Daley has yet to impress whenever he pretends to be a candidate. Thus continues that.


  41. - Cheryl44 - Monday, Sep 17, 18 @ 3:52 pm:

    B Daley is one Democrat I can’t even hold my nose to vote into office.


  42. - wordslinger - Monday, Sep 17, 18 @ 3:55 pm:

    – If for no other reason than this folks should consider voting for Rauner.–

    LOL, Rauner supporter Bill Daley floats crackpot idea that a Gov. Pritzker will bail out Chicago pensions.

    Probably take your guns, too.

    Just so clever.


  43. - Hieronymus - Monday, Sep 17, 18 @ 4:09 pm:

    @LP - Math, the pensions are unsustainable and payments will get much higher. -

    The normal cost of the pensions is quite sustainable. Forever borrowing from an unwilling lender _is_ ultimately unsustainable.

    Constitutional issues aside, let all of the other bondholders and vendors, etc. to whom the state owes repayment step up for their proportionate haircut. Any takers? Anyone?


  44. - blue dog dem - Monday, Sep 17, 18 @ 4:35 pm:

    Nothing a city earnings tax can’t fix.


  45. - Stuntman Bob's Brother - Monday, Sep 17, 18 @ 6:53 pm:

    ==Your brother should’ve told you to wear a helmet==
    My faith is in Takata, not Shoei.
    You need to stop and smell the roses JM, learn to laugh a little, life is short. Anyway, got an idea for a meme comparing Bill to one of those fainting goats? It’d be a winner.


  46. - Anonymous - Monday, Sep 17, 18 @ 8:55 pm:

    =let all of the other bondholders and vendors, etc. to whom the state owes repayment step up for their proportionate haircut==

    Good one. Everyone’s always talking about having skin in the game………..What they really mean is whacking pension members good(again, since they’ve been robbed once already) and tread very lightly on everyone else.


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