The Worst Financial Nightmare In Illinois History Is Here

[echo4747]

Will/can Illinois go bankrupt? Or is it all talk we have heard before?
https://www.investing.com/analysis/...inois-history-erupts-as-state-compt-200195870

 

[zinfamous]

Hah, a PaulBot writes an article. I was wondering if that article would have economic-based solutions, but it is propaganda. Shame. :\

Illinois is broke: fact
solution offered: mythical libertarian utopia nonsense.

 

[vi edit]

IL is major fucked. They have one of, if not *the* highest property taxes in the country. Sales taxes are high...upwards of 7.5%-10% depending on location and what is being purchased. And they have been bouncing the income tax rate all over the place. It was at 3.5%. Then it went to 5%. Then back to 3.75% and now they are looking at moving it to 6%.

They are losing high paying jobs at record rates as people leave the state to cheaper places to live. They can't squeeze any more out of property taxes. And the shift to higher income taxes will further push more people away from the state for those with lower tax rates. They are in trouble. I left 3 years ago and never looked back.

 

[dank69]

I predict the outcome will be the same as every other "government bankruptcy is imminent" situation in recent history.

I will say this though, the government pension racket needs some serious restructuring. CT is facing a lot of these same issues. Of course it is all liberals' fault.

 

[bshole]

I predict the outcome will be the same as every other "government bankruptcy is imminent" situation in recent history.

I will say this though, the government pension racket needs some serious restructuring. CT is facing a lot of these same issues. Of course it is all liberals' fault.

Yea because a teacher that works their entire lifetime with a predefined benefit promised to them, should have it taken away from them when they retire when they no longer have other options.

 

[dank69]

Yea because a teacher that works their entire lifetime with a predefined benefit promised to them, should have it taken away from them when they retire when they no longer have other options.

No, that is certainly not what I mean. However, I do think that people should not be able to work 20 years in one department and 20 in another and walk away with 2 full pensions on our dime.

 

[nathanddrews]

They could learn a thing or two from their friends from the nort'.

https://projects.jsonline.com/news/...y-funded-pension-system-is-one-of-a-kind.html

 

[MrDudeMan]

IL is major fucked. They have one of, if not *the* highest property taxes in the country. Sales taxes are high...upwards of 7.5%-10% depending on location and what is being purchased. And they have been bouncing the income tax rate all over the place. It was at 3.5%. Then it went to 5%. Then back to 3.75% and now they are looking at moving it to 6%.

They are losing high paying jobs at record rates as people leave the state to cheaper places to live. They can't squeeze any more out of property taxes. And the shift to higher income taxes will further push more people away from the state for those with lower tax rates. They are in trouble. I left 3 years ago and never looked back.

In your opinion, why is the state having so much trouble and why haven't their attempted remediation plans worked? I know nothing about the subject, but it's interesting and you always seem to have your head on straight, so I'm curious what you think.

 

[boomerang]

Yea because a teacher that works their entire lifetime with a predefined benefit promised to them, should have it taken away from them when they retire when they no longer have other options.

Where do you think the money should come from to pay those pensions?

People taking a haircut on pensions is nothing new. It's extremely unfortunate to put it mildly, but it's not uncharted territory.

 

[Capt Caveman]

Just need to raise the gas tax til it's $5/gallon. Drive to Five!!!

 

[IronWing]

Where do you think the money should come from to pay those pensions?

People taking a haircut on pensions is nothing new. It's extremely unfortunate to put it mildly, but it's not uncharted territory.

It's a totally unnecessary theft. Raise taxes to cover the promises made. Don't like the promises? Fine, elect politicians who won't make those promises in the future. The taxpayers (the ones who bothered to vote anyway) wanted their to eat their dinner but didn't want to pay the bill. Too bad, the dinner is eaten and the bill is due, pay up. In the future, order a more modest meal.

 

[vi edit]

In your opinion, why is the state having so much trouble and why haven't their attempted remediation plans worked? I know nothing about the subject, but it's interesting and you always seem to have your head on straight, so I'm curious what you think.

It's like asking why healthcare is so expensive. The answer is...it's complicated

It's just overall bloat everywhere.
http://www.usgovernmentspending.com/statelocal_spending_2017ILbn

Chicago and the cost associated with the upkeep of it is certainly not helping. Look at the pensions in IL vs IN or IA. All of those cops, teachers, firemen, ect are getting municipal pensions. The cost of employing them is high raising the protection and education budgets. When it comes to healthcare, IL gets back $.46 on the dollar (3 lowest in the country) for every federal dollar that goes out. Compare that to Kentucky that gets almost $2.20 back on the dollar from the feds for healthcare and you have another hole to dig out of.

Then you get into the whole debt issue where 7% of your annual budget is there to repay debt from the previous years.

It's just a pile of factors. Toss in the fleeing tax base of 1500 people (net loss per year), of which I am certain are higher paying jobs .My wifes dept (Pharmacist making 125k a year) lost 10 jobs to out of state positions before she left. I know half a dozen doctors that moved out to better gigs else where. And I doubt that many people are moving *into* rural IL (where we were) to make up for them.

Which is whole other issue. Outside of Chicago it's just not a highly desirable place to live. You have extreme weather in both the summer and winter. Falls are typically awesome. But otherwise it's hot and muggy summers, and cold and shitty winters. Outside of a few pockets in a couple interstate enabled cities there is zero diversity, it's completely rural, and you get shafted in property taxes.

How do they get out of it? There's no magic bullet. They'll need to start moving new municipal employees over to defined contributions instead of benefits for retirement. Hope that their current pension pullers die off earlier than expected. Maybe do some sort renegotiating on the pension rates currently being honored. Figure out some way to reduce their municipal overhead (which means more private schools/emergency responders/ect). And generally shrink down the size of the government.

They can also hope for some kind of federal medicaid expansion and/or a shift to single payer and maybe get more reimbursement for their health care costs vs. other states. They aren't getting paid the same way that others are right now.

Will they do it? No clue. It's second only to DC in swampy'ness.

 

[MrDudeMan]

It's like asking why healthcare is so expensive. The answer is...it's complicated

It's just overall bloat everywhere.
http://www.usgovernmentspending.com/statelocal_spending_2017ILbn

Chicago and the cost associated with the upkeep of it is certainly not helping. Look at the pensions in IL vs IN or IA. All of those cops, teachers, firemen, ect are getting municipal pensions. The cost of employing them is high raising the protection and education budgets. When it comes to healthcare, IL gets back $.46 on the dollar (3 lowest in the country) for every federal dollar that goes out. Compare that to Kentucky that gets almost $2.20 back on the dollar from the feds for healthcare and you have another hole to dig out of.

Then you get into the whole debt issue where 7% of your annual budget is there to repay debt from the previous years.

It's just a pile of factors. Toss in the fleeing tax base of 1500 people (net loss per year), of which I am certain are higher paying jobs .My wifes dept (Pharmacist making 125k a year) lost 10 jobs to out of state positions before she left. I know half a dozen doctors that moved out to better gigs else where. And I doubt that many people are moving *into* rural IL (where we were) to make up for them.

Which is whole other issue. Outside of Chicago it's just not a highly desirable place to live. You have extreme weather in both the summer and winter. Falls are typically awesome. But otherwise it's hot and muggy summers, and cold and shitty winters. Outside of a few pockets in a couple interstate enabled cities there is zero diversity, it's completely rural, and you get shafted in property taxes.

How do they get out of it? There's no magic bullet. They'll need to start moving new municipal employees over to defined contributions instead of benefits for retirement. Hope that their current pension pullers die off earlier than expected. Maybe do some sort renegotiating on the pension rates currently being honored. Figure out some way to reduce their municipal overhead (which means more private schools/emergency responders/ect). And generally shrink down the size of the government.

They can also hope for some kind of federal medicaid expansion and/or a shift to single payer and maybe get more reimbursement for their health care costs vs. other states. They aren't getting paid the same way that others are right now.

Will they do it? No clue. It's second only to DC in swampy'ness.

It sounds like the solution is for people to work together, which means it won't be solved any time soon even if a budget is cobbled together. Am I close?

 

[vi edit]

It sounds like the solution is for people to work together, which means it won't be solved any time soon even if a budget is cobbled together. Am I close?

They have some very hard decisions to make. In Chicago alone they have over 11,000 employees making over $100,000. That's a payroll of over 1 billion. For just those 11,000 employees. That doesn't count retirement or health benefits, just salaries. Total payroll for Chicago was pushing 3 billion. Municipal jobs and wages are going to have to get shrunk down. It's a vicious cycle of inflation. But they will get pummeled with the press by cutting emergency responder jobs. Even looking at things like going to salary and getting rid of the overtime draws helps some. But the unions and organized groups will scream bloody murder.

http://chicago.suntimes.com/politic...rd-of-chicago-city-workers-make-100k-or-more/

It's a terrible situation of which there is not many easy choices to fix.

 

[MrDudeMan]

They have some very hard decisions to make. In Chicago alone they have over 11,000 employees making over $100,000. That's a payroll of over 1 billion. For just those 11,000 employees. That doesn't count retirement or health benefits, just salaries. Total payroll for Chicago was pushing 3 billion. Municipal jobs and wages are going to have to get shrunk down. It's a vicious cycle of inflation. But they will get pummeled with the press by cutting emergency responder jobs. Even looking at things like going to salary and getting rid of the overtime draws helps some. But the unions and organized groups will scream bloody murder.

http://chicago.suntimes.com/politic...rd-of-chicago-city-workers-make-100k-or-more/

It's a terrible situation of which there is not many easy choices to fix.

I've heard Chicago has it bad in terms of various unions exerting a stranglehold on the city's ability to adjust its finances, but I have no first hand experience or knowledge.

It seems like a conceptually easy fix, but maybe I'm not understanding the whole picture yet. Way too much is going out and trying to take more in compounds the problem, so spend less. Duh - but that's not what I mean. People will get pissy about their salaries and pensions, but the alternative is bankruptcy, which is surely worse. Right? I'm not saying I want to see the state go bankrupt, but it seems as though that process would help course correct the financial situation. In a way, it's hard to believe what's written on the links in this thread because the implications are outrageous.

This isn't the right place for a comment about population size, but it really seems like the world's population is the primary reason for this type of situation continually popping up and subsequently worsening. Most of the problems we have as a society and worldwide community are exacerbated in a big way by the number of people currently in existence. Our ability to stay alive has far outpaced our ability to handle the surge in population.

 

[IronWing]

Expectations for public services have outstripped the desire to pay for them. There is an expectation for fire, ambulance, and police response times that can only be met through very high personnel numbers and station counts. This isn't cheap. In an expensive city, the costs are even higher. There is a disconnect between these costs and the politicians' willingness to fund these costs through increased taxes so they underfund the pension systems as a way to avoid responsibility on their watch. Yes, personnel costs can be cut but response times will increase. The politicians seem to be afraid to even bring the issue forward for discussion. It is a difficult discussion but, IMHO, is essential. How much are taxpayers willing to pay to shave a minute off response times? Are voters willing to accept higher density zoning if it saves money on providing fire/ambulance/police services?

The demands on first responders as far as educational requirements and needed skill sets have also increased. First responders rightfully expect to be paid more for their expertise.

 

[FelixDeCat]

Socialism, brought to you by the Democrats, is a GIGANTIC failure. Detroit, CA & IL are living proof.

 

[Exterous]

Yea because a teacher that works their entire lifetime with a predefined benefit promised to them, should have it taken away from them when they retire when they no longer have other options.

I think the IL pensioners are playing with fire. Many (most?) of them are exempt from SS - they don't pay in and won't get any benefits so they have an extra incentive for the pension system to be around. Yet the pension system is in trouble and there is no give on their side. We can debate why we are where we are but that doesn't mean the current situation goes away. A huge number of future retirees are banking on the enshrinement of benefits in the state constitution even though that can be removed if enough people want. (Refusing to budge is a great way to push people in that direction) Even if it stays Detroit has shown that pensioners are not safe from cuts during tough economic times. Will the amendment stand the court test in a financially destitute system? I'm not sure but I sure as hell know I wouldn't refuse to budge if I were in their situation. I would want to work with other parties and would be willing to make small reductions in benefits. Is it unfair? Somewhat. The benefits were promised yes but anyone who looked at the math knew the system has been failing for quite some time now. If you see its not working but say "Too bad - figure it out by making everyone else pay more" instead of working to make the future more sustainable you deserve some of the blame IMO. Even aside from that, reality isn't always fair but that doesn't mean you don't have to deal with it. And its not like the proposals have been stripping away huge chunks of the promised benefits. Tying the COLA to inflation, giving employees raises and then asking them to contribute a few % more towards the pension. The horror!

I've heard Chicago has it bad in terms of various unions exerting a stranglehold on the city's ability to adjust its finances, but I have no first hand experience or knowledge

Per the IL state constitution promised benefits can never be reduced. Lots of proposals to reform the system have been shot down because the unions don't have to give....for now.

Expectations for public services have outstripped the desire to pay for them.

Especially among the people who work public service jobs. Illinois has, if not the lowest then one of the lowest contribution requirements towards pensions. Many don't pay a single cent towards their pension in IL and the rest only pay about ~20% of the total outlay towards their pension. Asking public service employees to pay more than 0% - 2% towards their pension is hardly an onerous request.

 

[brycejones]

Socialism, brought to you by the Democrats, is a GIGANTIC failure. Detroit, CA & IL are living proof.

Still ripping off another members avatar. Add admitted thief to admitted troll. Poor Felix and his lack of morals.

 

[FelixDeCat]

Still ripping off another members avatar. Add admitted thief to admitted troll. Poor Felix and his lack of morals.

Okay, since all you do is repeat the same lie over and over and refuse to say anything worthwhile, you are now on ignore. I have given you several chances and pointed out your lie, but it appears to be the only thing you have. You will be released on 6/20/2018. Maybe by then you will get over yourself.

 

[MajinCry]

Socialism, brought to you by the Democrats, is a GIGANTIC failure. Detroit, CA & IL are living proof.

Capitalism, brought to you by the United States, is a GIGANTIC failure.

The invasion of Vietnam, overthrowing of Iran, overthrowing of Iraq, overthrowing of Libya, invasion of Somalia, tyranny and subsequent strangling of Cuba, persistent persecution of Native Americans, endorsement of East Timor genocide, overthrowing of Venezuela, are living proofs.

 

[MajinCry]

Okay, since all you do is repeat the same lie over and over and refuse to say anything worthwhile, you are now on ignore. I have given you several chances and pointed out your lie, but it appears to be the only thing you have. You will be released on 6/20/2018. Maybe by then you will get over yourself.

I thought you disliked safe spaces.

 

[ch33zw1z]

I thought you disliked safe spaces.

He's also posing as sonnikku, stolen avatar is stolen.

 

[FelixDeCat]

Capitalism, brought to you by the United States, is a GIGANTIC failure.

The invasion of Vietnam, overthrowing of Iran, overthrowing of Iraq, overthrowing of Libya, invasion of Somalia, tyranny and subsequent strangling of Cuba, persistent persecution of Native Americans, endorsement of East Timor genocide, overthrowing of Venezuela, are living proofs.

Socialism, corruption and people fleeing Detroit as criminals came to dominate led to bankruptcy. The same pattern is happening in Illinois. California is also experiencing capital outflows as socialist Democratic policies are making it hard for business to remain competitive.

 

[brycejones]

Okay, since all you do is repeat the same lie over and over and refuse to say anything worthwhile, you are now on ignore. I have given you several chances and pointed out your lie, but it appears to be the only thing you have. You will be released on 6/20/2018. Maybe by then you will get over yourself.

lol Felix: thief, admitted troll, and a total safe space bitch. I guess that's a trumper's definition of winning.