items tagged with pensions

“Pardon me,” said Ty Fahner to a nearby microphone that he had accidentally bumped during testimony to the Illinois Senate Executive Committee last week.

Fahner could probably be excused for apologizing to an inanimate object. The president of the Chicago-based, business-backed Civic Committee and self-styled pension expert had been forced to sit in the hearing room and wait for hours before testifying against Senate President John Cullerton’s omnibus pension-reform bill.

Cullerton was obviously furious with Fahner for helping organize the opposition to his bill, and he grilled former Illinois Attorney General Fahner mercilessly, tag-teaming with Senate President Pro Tempore Don Harmon, who picked apart the hostile witness piece by piece. Fahner tried to remain calm, but apologizing to the mic showed how much he was rattled.

House Speaker Michael Madigan was hoping on March 7 to avoid the same results as the previous week.

Back then, one of his pension-reform proposals received just one vote – his own. None of his other pension amendments received more than five votes.

That wasn’t supposed to happen. Members of his leadership team thought some of those amendments would get at least a few dozen votes. Oops.

Making matters worse, the House Republicans refused to even participate in the process, with not a single member voting up, down, or “present” on Madigan’s amendments.

Asked about the GOP refusal to vote, Madigan on last Wednesday’s Illinois Lawmakers television program said he believed the Republicans had made a “mistake.”

“They’re elected,” Madigan told host Jak Tichenor. “And their electors tell them to come here and vote. They don’t tell them to come here and not participate.”

For the past few years, the Civic Committee of the Commercial Club of Chicago has been one of the most feared participants in the state’s pension-reform debate.

Ty Fahner, a former Illinois attorney general who heads the Civic Committee, managed to convince both parties to elbow each other for a position of favor with him and his group.

When Fahner ended up siding with the House Democrats back in May and endorsing their pension-reform plan, including shifting costs to school districts, the House Republicans were furious and disappointed. They had been assiduously courting Fahner, and figured that since the Civic Committee is composed of several top Chicago business leaders, they’d be the natural ally of choice.

Not to mention that Fahner also formed a political action committee (“We Mean Business”) to back up his word. Everybody wanted that money, so the PAC gave his position additional strength.

But those days appear to be behind us, at least for now. Fahner’s histrionics last week over what he claimed was an “unfixable” pension problem have all but cut him out of the Statehouse mix. “He’s made himself irrelevant,” said one top Democratic official who is intimately involved with pension reform.

Pensions are among the most important investments American workers and employers make. We work for years so that when the time comes, we can retire with enough income to live comfortably, enjoy the much-deserved leisure time, and engage in activities of our own choosing.

This week’s cover story examines Iowa’s and Illinois’ pensions, which, when coupled with health-care benefits, are in grave danger of insolvency, threatening to potentially bankrupt Illinois. This is due to the unsustainable “defined-benefit” pension plan that promises each employee a percentage of his or her annual income, regardless of the amount of contributions made by the employee, or on the employee’s behalf by the employer (the state’s taxpayers), over his/her years of service.

[Note: Commentary from the Reader's editor, published on this topic, can be found here.]

A riddle: What do you get if you add $209 billion to $54 billion to $15 billion?

If you answered “a lot,” you’re correct and not particularly inclined toward math.

If you answered $278 billion, you’re adept at arithmetic and correct, if literal-minded.

If you answered the respective unfunded liabilities for Illinois’ state-run pension funds, its retiree health-care system, and its pension bonds, you’re correct and probably cheating.

And if you answered “a time bomb,” you’re probably most correct. Because while the numbers are important, they’re constantly changing and open to interpretation, and the most important aspect of them is their magnitude. Whether it’s cast as an $83-billion pension problem or a $278-billion benefits issue, the sheer size of it shows that it can’t be solved with tinkering.