I recently attended a State University Annuitant Association (SUAA) meeting because local politicians, Senator Dave Luechtefeld (R-58th) and Representatives Mike Bost [R-115th] and John Bradley [D-117th], were going to be there to answer questions about the future of Illinois pension systems. I did not have a recording device, so the following is based on my recollection and impressions of the meeting.
Representative Bradley's appearance consisted of a short speech, reciting a litany of excuses for the $83 billion unfunded liability in Illinois' pension systems without mention of the single biggest reason for the state's pension crisis--the deliberate under-funding of the pension systems by politicians for the past seventeen years (Since the creation of the Pension Ramp in 1995, which was signed by Republican Governor Jim Edgar and set Illinois' pension systems on a disastrous course that has brought our state to its present distinction of having the worst funded pension system in the nation.) Representative Bradley left before the question and answer part of the meeting.
Representative Bost treated the audience to a little of his angry-man schtick (always a crowd pleaser), venting his distrust of Speaker of the House Mike Madigan[D-95th] and his disgust with the Chicago political machine. Senator Luechtefeld came across more as the quiet-spoken, understanding grandfather; but it was clear that they were both at the meeting to convince retirees that things are so bad in Illinois pension systems that retirees should be ready to give up benefits to save the system.
Representative Bost used the image of retirees about to step off the edge of a 5000 foot drop, and Senator Luechtefeld assured the audience that "Things are even worse than you know".
"Unless something is done to pensions," Luechtefeld said gravely, "You may not have a pension some day." The only thing missing was some ominous organ music in the background.
Predictably, they dragged out the pension system version of Ronald Reagan's Welfare Queen--extreme examples of people who have gamed the system to receive overly generous pension payments. They failed to mention that politicians like themselves are completely responsible for the laws and loopholes that have allowed favored politicians and union leaders to receive those undeserved pensions.
The fact is that most retirees have not gamed the system. They have worked for 20-30-40 years, paying their share into their retirement system, and now they expect the state to live up to its part of the agreement.
One of the main points of the meeting was to express SUAA and union opposition to the proposed constitutional amendment (HJRCA49) that will be on the ballot in November.
The brief explanation of the amendment that will appear on the ballot sounds innocent enough. It asks voters to decide if a new section should be added to the Illinois State Constitution that would require a three-fifth majority vote by all governmental entities to increase a benefit in any public pension or retirement system. That is good--right? Everyone knows that runaway retiree benefits are the reason Illinois pension system is so deeply in debt--or at least that is what they would like you to believe. The fact is:
"If retirement benefits and salary increases were the only drivers of the unfunded liability, the state's retirement systems would be about 94 percent funded today. In other words, there'd be no pension crisis."-- Ralph Martire, Center for Tax and Budget Accountability, The State Journal-Register, 7/3/12 (The systems were funded at only 43.3 percent this past April.)
So what is the real purpose behind this proposed amendment?
Right now, the Illinois Constitution plainly states:
"Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired." (Article XIII -- General Provisions, Section 5. Pension and Retirement Rights)
For more than four decades, these words have protected the pensions and benefits of retirees from the grasping hands of politicians in Springfield. If the proposed amendment passes, those historic words be replaced by words that are guaranteed to be interpreted as an open invitation to politicians to cut pensions and benefits as they please.
When asked about this troubling aspect of the proposed amendment, Senator Luechtefeld suggested the amendment was no more than an attempt by Speaker Madigan to look like he is doing something to address pension costs without actually doing anything. Neither Senator Luechtefeld nor Representative Bost believed that the amendment would have any effect on the pensions and benefits of current retirees.