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I predicted this years ago

Back before I re-entered working in the policy and political domain, I was discussing how the growth of unsustainable pension benefits was going to eventually crowd out spending on necessary government services.

Since then, I could point to a headline a week that proved me right, all the way from Viejo, CA declaring bankruptcy (2008) to Illinois paying for pensions, but sending service providers IOUs.

Just this week, we are visited with a headline that should make every “pro-public-education-soccer-mom” hang their heads in shame. It provides evidence of just how absurd and out-of-whack our education priorities are.

Illinois to Spend More on Pensions than on Education

The state of Illinois faces at least $83 billion in unfunded liability between its five pension systems, and is on track to spend more on its government pensions than on education by 2016, according to a new study released by Governor Pat Quinn’s office, says Fox Business.

Illinois faces severe underfunding in its pension system.

The state of Illinois faces at least $83 billion in unfunded liability between its five pension systems, and is on track to spend more on its government pensions than on education by 2016, according to a new study released by Governor Pat Quinn’s office, says Fox Business.

Illinois faces severe underfunding in its pension system.

  • It reported a funded ratio of 43.4 percent, far below the 80 percent considered healthy.
  • Based on fiscal 2010 data, Illinois had the lowest funded ratio of any state, according to a June 2012 report by the Pew Center on the States.
  • Among states, Illinois stands out for setting aside a huge 12 percent of its annual budget just for its chronically underfunded pension.
  • My take is that we cut the COLA and raise the retirement age immediately. If they sue, so be it. Let the judges (who bear some responsibility for this mess). Another reform would be to prohibit anyone from receiving a pension who is earning money at another job. These 3 things alone would dramatically cut the unfunded liability.

    As for the larger picture, I would like to ask any teacher, any soccer mom, and/or any citizen how spending more on pensions than on education addresses a single education issue confronting Illinois. There is only way to describe this situation. It’s an obscenity.


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