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* Pantagraph…
After portraying state workers as overpaid and then terminating their union contract, Gov. Pat Quinn now wants them to know he still respects them.
In a letter sent Tuesday to about 49,000 employees under his control, the Chicago Democrat wrote that he wants to work with them to help address the state’s fiscal woes. […]
“Governor Quinn’s latest rhetoric doesn’t match reality,” AFSCME spokesman Anders Lindall said. “For months he has blamed state employees and retirees for Illinois’ budget problems and lied about their pay, health care and pension benefits.
“If he truly respects their work, he has a funny way of showing it, by trying to lay them off, weaken their bargaining rights and drive down their standard of living,” Lindall added.
* And here’s the e-mail…
Subject: Update: Our efforts to negotiate a new agreement
To all state employees in Illinois:
Throughout my career, I have respected the important work of public employees. Today more than ever I admire your dedication to serve in the midst of often difficult circumstances.
We did not create the unprecedented financial challenges we now face, but working together, we must take the difficult steps necessary to put Illinois back on sound financial footing.
Recently you may have read or heard about the status of bargaining between the administration and AFSCME.
My team continues to negotiate with AFSCME and other unions that represent most state employees with the goal of reaching a fair agreement as soon as possible.
I want to make very clear that my staff has not left the bargaining table. We are meeting again with AFSCME’s team next week. We have made significant efforts to compromise in negotiations, bearing in mind the reality of our unprecedented budget challenges.
I value your hard work, your commitment to the common good and your service to Illinois and its people.
* I also asked AFSCME for a response…
The proof will be in what the administration brings to the table. All year long our proposals have been extremely modest, and in the most recent round of negotiations we moved dramatically. We are seeking only to keep pace with the cost of living over the life of the agreement, while the state’s demands have relentlessly sought to drive down the middle class standard of living of state employees and retirees.
The Quinn administration’s demands reflect its misleading and overblown claims about worker pay, health care and pensions. They are not the basis of a fair agreement. So instead of talking about respect, it’s time to show it, with a new and different proposal at the table next week–one that doesn’t dig into the pockets of state employees, unaffordably driving up their health care costs and undercutting the middle class wages their families depend on.
* By the way, Quinn was booed by AFSCME members today at the Greater Kankakee Airport during an event to announce this…
A major national energy company on Thursday announced a $260 million expansion plan of an existing pipeline in Herscher that will make Kankakee County the center of gas distribution in the northern United States and Canada.
posted by Rich Miller
Friday, Dec 7, 12 @ 11:00 am
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Modest? A pay freeze is modest. AFSCME needs to use some of their members’ dues and buy a dictionary.
Comment by I don't want to live in Teabagistan Friday, Dec 7, 12 @ 11:05 am
Herscher! Go Tigers!
Comment by 47th Ward Friday, Dec 7, 12 @ 11:08 am
“Just want you to know, it was nothing YOU did. It’s ME, not you. You’re great. I know that we both, a governor and a state worker, will find our special someone, and they are out there for us. I respect you, and our time together. I wanted to say that before I say this …”
Comment by Oswego Willy Friday, Dec 7, 12 @ 11:09 am
Actions talk, BS walks.
Comment by Irish Friday, Dec 7, 12 @ 11:13 am
It is rude of AFSCME to go out a ruin events that are good news for the state. It’s fine to fight for your members, but they behave in such an egocentric way that it is unseemly.
They lost me in the fight to keep open empty prisons. They should have agreed to close something empty.
Comment by lessons learned Friday, Dec 7, 12 @ 11:15 am
- “Governor Quinn’s latest rhetoric doesn’t match reality” -
Talk about pot calling kettle. AFSCME leadership tells their members there is plenty of money to pay for raises, healthcare and all existing facilities. There’s reality for you.
It’s a good letter, I wish there had been communication like this all along, but given the breathless reporting about the contract not being extended a fourth time I think it’s a good start.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 11:16 am
“We did not create the unprecedented financial challenges we now face….”
Really…so the money you were suppose to use to fund the pentions instead of pork just disappeared into thin air?!?!
Comment by Bulbous1 Friday, Dec 7, 12 @ 11:22 am
“Today more than ever I admire your dedication to serve == night and day == in the midst of often difficult circumstances.”
Here’s the correct use of this phrase, Governor.
Comment by Wensicia Friday, Dec 7, 12 @ 11:23 am
Is he working night and day to convince state workers that he respects them?
Comment by Norseman Friday, Dec 7, 12 @ 11:27 am
- Really…so the money you were suppose to use to fund the pentions instead of pork just disappeared into thin air?!?! -
Yes, Quinn has been personally shorting the pension fund for 50 years. He also crashed the economy, himself.
You’ve finally figured it out.
Take a breath.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 11:27 am
Well now, isn’t that all just warm and cozy (rolls eyes). Is this where we all have a big group hug now?
At ‘lessons learned’: I’ve got broad shoulders and if you feel you must judge my and/or others actions, well you just go right ahead and do so. I learned a long time ago that ‘respect’ is something earned so if I come out and take offense to being labeled the evil of all evil, the leech of society, the ruination of the state blah blah blah…well, you can just walk my shoes for about the last six yrs and then we’ll ‘talk’ about whats’ ‘rude’ and disrespectful. Everybody has an opinion. You get yours and I get mine.
Comment by Cindy Lou Friday, Dec 7, 12 @ 11:30 am
It sure is funny that the budget short falls have to be made up on the backs of the working Joe. You don’t see them talking about cuts for legislatures or for high level elected officials. Makes you sick to see what is happening to the rank and file people who do the real work.
Comment by labor at heart Friday, Dec 7, 12 @ 11:31 am
“We did not create the unprecedented financial challenges we now face,”–
um, we are half way thru quinns elected term, he had two years before that succeeding blago, and was light gov for six years and two elections as blagos side kick. you own it, quinn.
state employees and retirees are under attack all over the place. cola’s, health insurance cost and availability, retirement age, pension contribution rate…and i am probably missing a few. quinns letter is an insulting crock.
but hey, they will prob screw around long enough that retirees get another compounded cola january 1.
Comment by langhorne Friday, Dec 7, 12 @ 11:32 am
If that is respect and value I would hate to see disdain…
Comment by OneMan Friday, Dec 7, 12 @ 11:33 am
This would be World War 6 if Quinn were a republican….
Comment by Moe Friday, Dec 7, 12 @ 11:37 am
Why didn’t I get the email? I feel dissed. Maybe I should check my junk folder!
Comment by lincolnlover Friday, Dec 7, 12 @ 11:39 am
PQ’s letter is offensive, and I’m not even a union member.
The budget situation is better than 2 years ago but it still stinks. AFSCME needs to realize that their winning streak is over in terms of raise after raise after raise for their members.
But Quinn is really setting the standard for doubletalk on this issue. He wants it both ways: I’m a tough guy cancelling the contract, and I’m still negotiating as a long-time friend of labor.
If you “value” someone’s work, you pay them. Don’t try to bs the situation. Just be honest and say the cupboard is bare.
Comment by DuPage Dave Friday, Dec 7, 12 @ 11:40 am
AFSCME is doing itself a disservice as well as the rank and file by their actions in this situation. As a state employee I am not aware that the union has said “there is plenty of money to pay for raises, healthcare and all existing facilities”. What I have heard is that there are resources available and we are left with the impression that revenues can be enhanced to address this issue. The union perhaps is looking at what happened in the CTU strike with the city saying they don’t have the resources but then agreed to a generous contract.
I don’t know how much help the modest changes would make in the overall picture but I think the union should be doing less in your face confrontation.
Comment by dupage dan Friday, Dec 7, 12 @ 11:47 am
I assume there will be a strike, but I’m not sure what Quinn will gain from it. This makes no sense — the strike or the aftermath. How can a democratic governor with a democratic legislature possibly benefit from a strike? If Quinn gives his final offer next week — and it looks like he will and if the union rejects it (which I assume they will) — then there’s no choice but to strike.
When over 95% of the state workforce is unionized — what’s the benefit here? Quinn alienates middle-class state workers — to what end? Why? Quinn will hand his job to any credible GOP challenger — who will, most certainly, do what’s happened in Wisconsin and now in Michigan.
If anything, Quinn actions here will start the ball rolling for a vastly weaker labor movement in Illinois for years to come. All this from a guy that has traditionally stood with labor? I don’t get it. This makes no sense at all.
Comment by Burnham the Monk Friday, Dec 7, 12 @ 11:57 am
Cindy Lou, I have broad shoulders too. I belong to a different union. Don’t protest job creation.
Comment by lessons learned Friday, Dec 7, 12 @ 11:59 am
Quinn is full of baloney. If he cared about the rank and file he would have cleaned house years ago of the executive management at the Illinois Tollway. Quinn has just perpetuated an already miserable situation. Quinn uses this agency as bank account for the rest of the state
Comment by Stuck on Stupid! Friday, Dec 7, 12 @ 11:59 am
Oh wait Gov. Quinn, let me pull the knife out of my back so I can sit down and read your warm and fuzzy email! I hate to say this, but at least I have a sliver of respect for Gov. Walker, he at least is up-front about screwing the State workers, and went about it through the front door–Quinn on the other hand, talks out of both sides of his mouth while he goes through the back door to do the same thing. Quinn needs to stop listening to Fahner and the other bigwigs, they are playing him like a fiddle, and he’s making a fool of himself! It’s scary that this man is in charge of our State!!
Comment by huggybunny Friday, Dec 7, 12 @ 12:01 pm
AFSCME might be turning some people off with their behavior, but in their defense, how humiliating and degrading to be trashed all over the media and by the big boys for the work you do. Definitely making many wonder what they’re doing working at the job, I’m sure. I wonder how those who work in the private sector would like to have their “compensation package” listed in the newspaper with their name and have that become the topic of discussion at social occasions, front page newspapers, and everywhere else. Respect? Governor, that works both ways. If you don’t want to be harassed by those you disrespect, don’t disrespect them.
Comment by geronimo Friday, Dec 7, 12 @ 12:10 pm
When did Quinn, media and the “big boys” disrespect AFSCME? Observing the back-and-forth reminds me what a thin skin AFSCME’s leaders have. Quinn withstands their barrage of venom, protests and misinformation and has the decency to remind rank-and-file workers he appreciates them. Good for him.
Comment by horseracer Friday, Dec 7, 12 @ 12:16 pm
Dear Gov Quinn (and past Govs),
While you and your Chicago friends have been disparaging State workers and passing out goodies with the money that shoudl have been going in to the pension funds, we have been busy keeping this leaky ship of state barely afloat. We’re tired of bailing you out, so we’re going to take a short break.
We’ll be back once you agree to honor all the existing contracts and obligaitons.
Signed: your employees … who also happen to be taxpayers and voters
Comment by RNUG Friday, Dec 7, 12 @ 12:16 pm
Yes, he’s a real prince.
Comment by geronimo Friday, Dec 7, 12 @ 12:22 pm
The letter was conceived and written by the same 20-something who came up with Squeezy.
Comment by Anon. Friday, Dec 7, 12 @ 12:27 pm
RNUG: If by “goodies” you mean capital projects — Pretty sure that the $ used to build roads and schools can’t be used to fund pension systems. Those payments aren’t bondable.
Comment by horseracer Friday, Dec 7, 12 @ 12:28 pm
horseracer,
The money that was never put in the pensions was used to ‘balance’ the state budget every year, ie, mostly GRF spending.
Capital projects are bonded … but they couldn’t be bonded without corresponding GRF funds to repay the bonds … and GRF is where the money for the employer pension payments comes from.
So you’re making a distinction without a difference.
Comment by RNUG Friday, Dec 7, 12 @ 12:35 pm
horseracer,
Since you apparently weren’t paying attention during the Blago years, they did float bbonds to make the pension payments for all of two fiscal years while saddling the state with many. many years of repayment.
And Blago wasn’t the first Gov to do so …
Comment by RNUG Friday, Dec 7, 12 @ 12:42 pm
RNUG - You mean the money that’s been used to sustain the agencies state employees work for? The money to pay for programs administered by state employees?
I wasn’t aware AFSCME supported reducing the size of state government. You better tell Henry, that would free up money to pay for the remaining employees’ pensions.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 12:43 pm
Does anyone know precisely what the State did with the $$$$ it did not deposit into the pension funds over the years? Did the State have the $$$? If not, how much would the State have had to tax/borrow to make all the payments? I’m so tired of hearing the union squeals about the state not making its deposits. I’m just curious about what Illinois would look like today if ALL the state, county and local governments did what they needed to do to ensure that their gov employee pensions (not just the 5 or 6 at the state level but the hundreds in IL) all were funded at 80%, and let’s throw in 80% funding for promised healthcare benefits.
Comment by Cook County Commoner Friday, Dec 7, 12 @ 12:45 pm
STL - False choice.
Comment by PublicServant Friday, Dec 7, 12 @ 12:46 pm
I missed the announcemnt that Quinn ended his career; that must be the case because he certainly isn’t showing public employees respect now. If he had admiration, why is he throwing thousands under the bus now?
Actions being taken against public employees is not at all equitable. Look at the frivolous spending going on. Look at how well the legislators do for themselves with their partime job. Why are the pork projects so well hidden in budgets that they are not pointed out everyday by the media; why doesn’t somebody take time to dig through volumes of rhetoric to show Illinois as the contry’s most dysfunctional state?
It is not all public employees that are being made scapegoats, just the rank and file. While Mr. quinn failed to honor his word and contract for state workers represented by bargaining units, agency senior staff seem to do quite well with their raises and COLAS. Don’t think that is true? Look at the bigwig salary increases documented on Topinka’s Ledger website. The disrespect of people’s intelligence and the games these politicos play is just disgusting.
Comment by BMAN Friday, Dec 7, 12 @ 12:48 pm
PublicServant - Do elaborate, please. In fact, I think it would be a great idea for AFSCME to submit a list of expenditures they’d support eliminating in order to pay for the pension.
Submit it to the GA, get them to propose a budget reappropriating the money, get the Gov to sign it.
Seems like it would be more productive than protesting every public event their members can get to.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 12:53 pm
Reformer - First, you should apologize to real victims of domestic violence for making that reckless comparison.
Second, the legislature did not appropriate enough money to provide raises, so they didn’t go to some agencies. If they had, Quinn would have paid them. Check the record.
Comment by horseracer Friday, Dec 7, 12 @ 1:03 pm
Correct me if I’m wrong STL, but are you saying that the reason the pensions were shortchanged by the legislature was so that they could afford to pay the wages and salaries of its employees? When the unions were negotiating their contracts, are you saying that they knew or should have known that the pension funds would have to be raided to pay for their compensation? I may be misinterpreting your position here, but that is the false choice that I was referring to. On the other hand, if your angry with the union for a perceived lack of cooperation by the union, I get that. I think, however, that they would argue that their prior cooperation hasn’t gone too well for them lately, so I can understand their reticence too.
I certainly know that when I was hired, they said here’s your salary and here’s your benefits. Must have missed the memo saying “in the future, we’ll be raiding one to pay for the other”.
Comment by PublicServant Friday, Dec 7, 12 @ 1:05 pm
=== Reformer - First, you should apologize to real victims of domestic violence===
Agreed, which is why I deleted the comment. And that person may not be coming back, either. Sheesh. What a clown.
Comment by Rich Miller Friday, Dec 7, 12 @ 1:06 pm
Small Town Liberal,
You obviously have mistaken me for an AFSCME fan. Regulars here know I was never a member of AFSCME or any other union. In fact, I often railed against the excesses of the union in terms of seniority re promotion and work rules.
But the fact remains the State, over the years, didn’t put the money in the pensions because it was used for a lot of other things, including both valid state programs, pork barrel spending and corporate giveaways like CME. The pension funds were shorted because the GA didn’t raise taxes to pay for everything else … so they used the pension fund as a piggy bank of sorts, just like they’ve used the Quality Care insurance program by delaying payments there … and almost every other state program where they could.
Comment by Retired Non-Union Guy Friday, Dec 7, 12 @ 1:09 pm
PublicServant - My position is much more simple. If they money to pay for the pensions and raises exists, I wish the union would show us, and show the GA so they can draft a budget reflecting that.
There’s always a lot of talk about pork and waste, but usually no details. Show me where the money is and I’ll get behind you 100%. But the math has to add up, or it’s just a waste of time.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 1:09 pm
Cook County - So sorry you are tired of hearing victims of theft squeal when the thief blames them for the crime.
Comment by lincolnlover Friday, Dec 7, 12 @ 1:14 pm
Cook County Commoner @ 12:45 pm:
Short version: IMRF (Illinois Municipal Retirement Fund) is the retirement funding mechanism for all non-state government. It is properly funded because the cities and counties HAD to make the payments every year under State law. Only the State got to break the State pension funding rules.
Multiple reports by both liberal and conservative groups and analysts have all stated that something around 70% of the current state (SERS/TRS/SURS/JRS/GARS) pension funds shortfall is due to the failure to make the employer payments when required. Another 20% or so of the shortfall is the lost investments fromt he funds not being available to invest. Less than 10% has been attributed to increased benefits and/or gaming of the pension systems by a small number of individuals.
Comment by Retired Non-Union Guy Friday, Dec 7, 12 @ 1:16 pm
AFSCME’s job is to represent me, and the other 48,999 members, in negotiations with the state. That is what I pay them for. Their job is NOT to balance the budget or find the money that the state contractually agreed to pay. That is the job of the General Assembly.
Comment by lincolnlover Friday, Dec 7, 12 @ 1:19 pm
Let’s see if Quinn respects us enough to abide by Billik’s ruling.
Comment by Johnnie F. Friday, Dec 7, 12 @ 1:20 pm
RNUG - Sorry, didn’t recognize your acronym.
The fact does remain that the state didn’t adequately fund the pension for years. A lot of years. Decades before Quinn became Governor.
Now it’s time to pay the piper, and I’d just like to know where everyone expects the money to come from. I’m a huge union supporter, but I’m also a huge math supporter.
If anyone can show me a way that adds up without harming anyone, I’ll gladly jump in line to support it, and I’ll bring all the friends I can.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 1:21 pm
As I told a friend of mine the other day about this letter to State workers from Quinn, it is kind of like free healthcare for the guys. It is like a prostate exam from him, one hand on the state workers back and the other - oh never mind.
Comment by Anonymous Friday, Dec 7, 12 @ 1:21 pm
Small Town Liberal,
The “money” is the taxes everybody, governement employee, private enterprise employee, or businessman, repeat, everybody should have paid the last 40 years.
Instead of raising taxes, the GA put it all on a credit card labeled ‘pension fund shortfall’.
So now all taxpayers will have to pay more … because they didn’t pay enough for 40 years and it’s time to pay off the credit card.
Comment by Retired Non-Union Guy Friday, Dec 7, 12 @ 1:21 pm
- That is the job of the General Assembly. -
Then why are all the protests against Quinn? He’s not a member of the GA.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 1:22 pm
Quinn says he respects state workers but actions speak louder than words. Does he think they are a bunch of chumps?
Comment by Stones Friday, Dec 7, 12 @ 1:23 pm
STL,
There is no painless way. The only answer is more revenue because the problem is too big to just cut yoru way out of it. The only question is do you fix it in 5 years or 40 years?
To toss out some numbers I threw around yesterday
Comment by RNUG Friday, Dec 7, 12 @ 1:24 pm
===and it’s time to pay off the credit card. ===
There are many ways to pay off a credit card.
You can ask your boss for a raise (higher taxes).
You can cut your spending.
You can sell your assets (or close facilities).
You can refinance your debt.
You can negotiate through a third party to consolidate your debt and lower your payments.
It’s not all about taxes, folks. Get over it. Not gonna happen again. Find another way.
Comment by Rich Miller Friday, Dec 7, 12 @ 1:25 pm
- So now all taxpayers will have to pay more … because they didn’t pay enough for 40 years and it’s time to pay off the credit card. -
You better convince the GA, I’m pretty sure they have some role in raising taxes. Quinn can only sign bills, not pass them.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 1:25 pm
RNUG - The state has had 2 capital programs in the last 13 years. Both were funded with *new* revenue (license fees, liquor taxes, etc.) -construction funding does not drain money away from GRF. Period. How much state construction goes on in between capital programs? Precious little. Why? No money for it.
Comment by Hyperbolic Chamber Friday, Dec 7, 12 @ 1:26 pm
We heard from a union rep this week that as far as negotiations go, “we are in ICU, on life support.” He said in his many years of union negs, he’s never seen an admin so hellbent on an “impasse.”
Comment by uniongal Friday, Dec 7, 12 @ 1:34 pm
RNUG, While I agree with your points I don’t think we are going to see the GA or Quinn look to raise taxes soon to pay for the pension mess. Hard enough to pass a new tax to pay for a program - something people can see and touch. It’s another to ask for more revenue to fix the pensions when the taxpayers are looking at working longer to make up the losses in their own 401Ks and such. Very hard sell. The GA and Quinn know this - a measure of cowardice exists there. It appears easier to demonize the state employees and demagogue the issue.
Comment by dupage dan Friday, Dec 7, 12 @ 1:35 pm
Darn … wish there was an edit button…
I’m going to start by assuming the current ‘temporay’ income tax increase will stay in place.
For every percentage point you raise the income tax, you’d get about $2.3B
If you taxed all retirement income (state, private and SS) at the current 5% rate, you’d get about $1.2B
Assuming the services sector is equal to the merchandise sector, a sales tax on service would bring in about $9B.
Other’s have tossed out ideas like taxing transactions at CME. They proposed a $2 tax per trade ($1 buyer / seller). Don’t remember the bottom line they estimated but it was quite a few billion.
All the above could be done, relatively speaking, easily by the GA.
The harder change would be to a graduated income tax sturcture since it would require a Constitutional amendment and voter approval. I’m not going to even guess on what that could generate because it would depend on the details.
Or, since it is one of the major drivers, rework the pension fund repayment ramp-up to a longer period with lower payments … but that won’t make the bond rating houses happy … and rumor has it the State wants to bond around $30B of capital improvements this coming year.
None of this will be painless … but the time for painless was twenty or thirty years ago. And any action will cause the press and public to vilify the GA and Gov.
Comment by RNUG Friday, Dec 7, 12 @ 1:35 pm
STL - Revenues are used to pay expenses. You certainly can find revenue to pay for your priorities by cutting back on one or more of your priorities, whether its from pork or waste or the meat of the programs themselves, and shifting those funds to cover other programs.
That won’t solve Illinois’ structural deficit, however. That requires new revenues. I didn’t see you mention that in your math above. Bondholders don’t care whether we have the money to pay for all of our stated priorities. They care about being paid. Period. And their payback is protected by law. So is the pension payback. I must have missed the revenue enhancement heavy lifting being done with regards to pensions, or are you saying that cuts are the only option? You’re beginning to sound like John Boehner.
Comment by PublicServant Friday, Dec 7, 12 @ 1:37 pm
BTW - I really don’t see the State actually raising taxes … but people keep asking where the money could come from. Taxes is one possibility. Rich points out others.
Comment by RNUG Friday, Dec 7, 12 @ 1:39 pm
Currently, Quinn has little public support. AFSCME is making a mistake by picketing community ribbon cutting events. AFSCME’s actions may actually make Quinn look like the reasonable person in this debate. AFSCME needs to win over the sentiments of the public, whom the majority of are not union members, do not receive pensions and are not public employees. Be careful, whom you are crying to.
Comment by Endangered Moderate Species Friday, Dec 7, 12 @ 1:44 pm
Retired Non-Union Guy - Friday, Dec 7, I am so glad to see that somebody gets it ! Yes the free ride is over, now pay the bill!
Comment by Sgtstu Friday, Dec 7, 12 @ 1:44 pm
strange for that he would send this letter to the employees and still demand all of these concessions. What the employees would do is go to work everyday without complaint to service the people of Illinois. Sad state of affairs for Illinois the laughing stock of the union. Heaven Help us…
Comment by anonymous Friday, Dec 7, 12 @ 1:45 pm
I had a Samsung TV go south on me. It cost $300 to fix. There was a Class Action Suit in Colorado that forced Samsung to fix all the TVs with this ‘known’ problem.
I got a letter from Samsung and they started their letter to me “Dear Valued Customer.” Yeah, right. They knew of the problem and tried to ignore it.
All I can say is that Quinn and the rest of those Bozos think we are idiots. You blow our money, shirk your responsibility to pay your fair share, and want to penalize us? Then tell us how we are so great?
Goof grief!
Comment by Sunshine Friday, Dec 7, 12 @ 1:45 pm
I’m not sure why they wouldn’t consider more taxes. The fact is that the Democrat majorities rammed through the largest tax increase in state history, and voters chose to reward them by expanding their majorities.
Comment by LincolnLounger Friday, Dec 7, 12 @ 1:46 pm
Rich - Thanks for the post. After retiring I’ve missed the annual (Quinn isn’t the first) Governor’s letter thanking us for doing more with less, blah, blah, blah. It usually came this time of year and was preceded by 11 months of abuse and excuses for no raises etc. You could tell who had just opened their e-mail by the sounds of foreheads smacking desks and muttered curses. The only sounds of good cheer came from the clout babies whose six figure salaries and very flexible work hours kept their spirits merry and bright. Thanks again.
Comment by Anon. Friday, Dec 7, 12 @ 1:50 pm
- You’re beginning to sound like John Boehner. -
Right.
I’m all for enhanced revenue. Personally wish we had a graduated income tax, fewer loopholes, and an expanded the tax base.
Hopefully in the future all of these things will happen and things will improve.
I also don’t believe we need 100% funding, but the brilliant bond rating agencies are demanding it, and I don’t think there’s a lot we can do about that.
I don’t see these ideal solutions happening soon enough to avoid major problems with our credit rating, so I ask again, where is the money Quinn is supposed to come up with on his own?
Comment by Small Town Liberal Friday, Dec 7, 12 @ 1:52 pm
“It’s not all about taxes, folks. Get over it. Not gonna happen again. Find another way.”
Hard to get over it when I pay more state tax on a patch for my bicycle tire than the Whitley/Fahner crowd pay for their yachts to be cleaned.
Comment by Crime Fighter Friday, Dec 7, 12 @ 1:53 pm
Rich,
You allude to it in reduced spending, but more bluntly, one of the other alternatives is reduced State services.
Every State program should be tested with the question: is this something government should be doing?
And for the ones we decide to keep, we should have to justify their existence every year. Maybe each program should have relevant metrics associated with it. And I’m not talking metrics like how many people you signed up for the program. I’m talking outcome based effectiveness metrics like, for people receiving welfare, how many were transitioned off welfare to be self-supporting. Or how many jobless became tax-payers. Or what percentage of schools drop-outs does progam x provide a GED?
Comment by RNUG Friday, Dec 7, 12 @ 1:58 pm
STL - I see now. Quinn can’t come up with anything more than the legislature appropriates. I see your point. I don’t blame him for having his hands tied. I do blame him for his stance on the pensions. He won’t be getting my vote anytime soon.
Comment by PublicServant Friday, Dec 7, 12 @ 2:05 pm
As a merit comp employee…. No raise for 8+ years….unpaid furlough for a few years and that impacted my pension…doing more than one job each and everyday…. I am Thankful to have a job….( Observing a well deserved VA day today). PQ and AFSCME can both go take a hike… Both are HORRIBLE for the State Of Illinois!!!
Comment by Albert... Friday, Dec 7, 12 @ 2:12 pm
geronimo, have you ever heard of being the better person? So just because someone is bad to you, that means you get to be bad in return. Wow. No wonder our society has problems.
Comment by Come On Friday, Dec 7, 12 @ 2:14 pm
Crime fighter @1:53 pm- exactly!
Comment by Roadiepig Friday, Dec 7, 12 @ 2:29 pm
Come On
With all due respect, we’re not talking about being the better person when someone cuts you off in traffic or beats you to the line in the grocery store. We are talking about peoples’ livelihoods here. Workers and retirees have mortgages to pay, kids in school, like everyone else, of course, but now the certainties promised 35-40 years ago have upended their futures. I would imagine most people, private or public employees,do not take losing their retirement promises and a loss in take home pay lightly. These pending decisions being bantered about are life changing for some! I personally know of 3 young teachers who are leaving the profession……….they just won’t gamble on their future like this. They’re young and have lots of time. But older workers/retirees don’t.
Comment by geronimo Friday, Dec 7, 12 @ 2:37 pm
Roadiepig - Friday, Dec 7, 12 @ 2:29 pm:
Crime fighter @1:53 pm- exactly! ==
Thanks for the shout out Rp.
Quinn’s puffery versus his actions make him more like Blagojevich every day.
Comment by Crime Fighter Friday, Dec 7, 12 @ 2:51 pm
What is funny about Quinn’s E-mail, it ended up in the junk folder of most of the employees on my work site. Exactly where it belonged.
Comment by AFSCME Steward Friday, Dec 7, 12 @ 2:57 pm
My understanding is that the pension underfunding is 46% due to the State not making the payments, and the balance due to lack of investment return and the recent recession in particular. The first thing I would do is present both pieces and discuss strategy from there. I believe most State employees could understand paying more to compensate for a lack in investment return - and would appreciate more realistic investment return modeling. Many financial people are not surprised by this turn of events - a defined pension is not a silver bullet for return on investment. 401K plans and defined pension plans invest in the same markets. No one wants a 401K plan as they know they cannot get guaranteed returns, but magically somehow defined pension plans can get better returns?? This is not an AFSCME issue - it is an issue for every public employee in America.
Comment by Scottish Friday, Dec 7, 12 @ 3:00 pm
He respects and values them (in the morning?).
But he won’t give them cab fare home.
And he won’t call. Except …maybe in couple months…a drunk dial …at 2:00 AM.
Comment by titan Friday, Dec 7, 12 @ 3:14 pm
Rich has succinctly outlined the task facing the Governor and General Assembly to pay off the analogous credit card and putting the state in the black.
He indicated “There are many ways to pay off a credit card.
- You can ask your boss for a raise (higher taxes).
- You can cut your spending.
- You can sell your assets (or close facilities).
- You can refinance your debt.
- You can negotiate through a third party to consolidate your debt and lower your payments.
It’s not all about taxes, folks. Get over it.”
Today a lot of folks are getting into the game of what would you do - cut capital programs, raise taxes, yada yada yada.
Unless the Governor, legislator or a member of their senior staff are hiding behind a pseudonym on this blog, none of us will be given a seat at the table. Lobbyists representing the various interests will be outside the room whispering into many of those inside, but our influence will only be heard in the collective.
With respect to the first point of the post, whether Quinn respects workers, he probably does, but he also sees them as a major cost factor and an easier target to cut in order to pay down the “credit card.” To argue that point, he’s used rhetoric regarding state employees that certainly doesn’t make one feel respected.
With respect to changing existing employees and retirees pension benefits to help pay the “credit card,” I strenuously oppose it. Employee and retiree decisions were based on a constitutional guarantee of these benefits. I understood that nobody guaranteed I would survive 33 years with the state - almost didn’t, but I knew that at the end I would have reasonable retirement benefits. I paid my contributions while the state didn’t pay its share.
You hear that state workers need to be a part of shared sacrifice. State workers have and will continue to suffer as part of “shared sacrifice.” What is so conveniently ignored is that pension benefits have been changed for newer employees. Current merit comp employees have suffered through years of pay freezes and in some years - pay reductions. Given the size of the “credit card” debt, I doubt that state workers, or at least MC workers, will see any raises for a number of years. I also anticipate that layoffs will occur as well. I believe these actions will have a long-term negative impact on the quality of public servants in the future, but that is for another post.
Reviewing the comments from many learned folks from Rich to Steve Schnorf, I’ve frequently thought about what modest reductions I could accept. I always come to the point where I ask whether I can trust others’ ideas of what those modest reductions would be. Given my experience as a part of the legislative process and observing it for all these years, I ask whether I can trust that this will be the only reductions I will be asked to make. My conclusion is a resounding “NO.” I can’t trust that he changes will be modest. I don’t trust that the Governor and members of the General Assembly will be disciplined enough to avoid forcing us and future workers to accept additional cuts.
Reiterating what so many others have said, this will come down to the courts. Whether they reaffirm the constitutional guarantee of the pension benefits or force the state in the future to directly cover the cost of retiree pensions after the decades of underfunding finally results in the depletion of the retirement funds.
I hope that a court reaffirmation of the constitutional guarantee will force the Governor and General Assembly to become more disciplined and strategic in developing legal options to pay off the credit card. I fear the political reality and the desire to maintain power will result in a continuous patchwork of short-term fixes that will require additional short-term fixes.
Comment by Norseman Friday, Dec 7, 12 @ 3:23 pm
If the Natural Gas pumped into and stored in the huge underground geological formations around Herscher ever blows, all these other issues will be gone, and won’t nobody be getting no more beer and fish at Club Irwin
Comment by x ace Friday, Dec 7, 12 @ 3:57 pm
RNUG has come up with some solid information on the “raising taxes” part of Rich’s 5-prong credit counseling program . We have heard a smattering of ideas for refinancing and consolidating debt, which could probably be part of the overall solution with borrowing rates that could be locked in at all time lows. I also foresee consideration of privatization that would potentially give the state an immediate infusion of tens of billions of dollars, the only issue being that “user fees” that were once hidden in taxes are bound to be more in our faces. Facilities like Starved Rock Park or the Tri-State Tollway could generate untold billions as a one-time cash infusion for the state and would be attractive properties for investors who would have a fairly predictable revenue stream (as opposed to something new where the market wasn’t known).
Comment by Six Degrees of Separation Friday, Dec 7, 12 @ 3:58 pm
- If the Natural Gas pumped into and stored in the huge underground geological formations around Herscher ever blows -
Nah, worst case scenario is one of the wellheads blows and the gas burns out over the course of a few days through that one well. No oxygen down inside the formation to ignite.
There are several storage fields in the state, helps the gas companies hedge against the winter prices.
Comment by Small Town Liberal Friday, Dec 7, 12 @ 4:18 pm
===Club Irwin===
That’s a swanky joint x ace. I wasted a fair bit of my youth there. Good times.
Comment by 47th Ward Friday, Dec 7, 12 @ 4:45 pm
Six Degrees of Separation @ 3:58 pm:
Borrowing (differently than current structure) is a possibility but just because you have a low interest rate doesn’t mean you save money. You have to look at the term you will be paying the interest.
It might make sense to borrow to pay off the annual overhang of $8B if you limited the repayment period to 4 or 5 years, longer term on that could be questionable. But you’d still have to figure out where to get the money to repay it.
On the pension funds shortfall, I think the relevant comparison is to the current ‘ramp-up’ plan because, for better or wrose, that is where we are right now. Could a bond offering be structured to make the funds solvent immediately while paying the same or less total interest and/or where the repayment amount each year would be less than the current ‘ramp-up’ payment of approximately $3B?
I don’t think so; a quick and dirty estimate with a mortgage spreadsheet says that $95B over 40 years at 4% is around $4.8B yearly payments. I went out as far as 100 years. You pretty quickly reach a point of diminishing returns where much longer terms don’t really lower the annual payment.
Mathmatically, the bottom line seems to be the State needs to make about $4B - $5B annual ‘catch-up’ payments to the pension funds for the forseeable future.
So I’ll stick with my contention you can’t just cut your way out of this one … there is going to have to be new revenue at some point.
Comment by RNUG Friday, Dec 7, 12 @ 4:48 pm
Norseman, thanks for saying again what needs to be said in ever thread dealing with people’s continued misconceptions regarding the pensions. As for negitiating, (1) they’re not asking us, they’re attempting to tell us, and (2) they’re saying if we do negotiate, we’re starting from the ‘totally decimating your benefits’ point. Talk is cheap. The courts are where we need to focus, because come the first week in January, Fahner will be celebrating what I hope will be a short-lived victory of the one percenters over the little guy, and Rich will be running yet another thread on pensions.
Comment by PublicServant Friday, Dec 7, 12 @ 4:49 pm
About the only other ’solution’ is to hope New Madrid blows soon or the Mayan calander is correct
Comment by RNUG Friday, Dec 7, 12 @ 4:50 pm
Psalm 123:3-4
Comment by Anon. Friday, Dec 7, 12 @ 5:15 pm
Anon
LOL! … the NIV comes closest
Comment by RNUG Friday, Dec 7, 12 @ 6:03 pm
Many of us around the State took the memos from the Gov. and the “you’re great” memo from Juvenile Justice Director Bishop and RETURNED them to Management. Our message was we want a fair contract and the raises you owe us.
Comment by state employee Friday, Dec 7, 12 @ 7:05 pm