“Politicians are to blame for the state’s fiscal woes, but mainly because they colluded with unions to promise unsustainable benefits in return for political support.” – Wall Street Journal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The above quote comes from a May 8, 2015 Wall Street Journal editorial titled “Illinois Pension Blowup”, subtitled “State judges tell taxpayers to pay for political-union failure.”
Here is how the editorial begins:
The Constitution is not a suicide pact—except maybe in Illinois. On Friday [May 8, 2015] the Illinois Supreme Court struck down modest pension reforms as a violation of the state constitution in a decision that tees up state taxpayers for years of tax increases.
The court ruled unanimously that pensions are inviolable under the plain text of the state constitution, which holds that “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.”
Here is how the editorial ends:
All of this means that Illinois and its municipalities may soon have little choice but to raise taxes or restructure debts to pay for pensions. Chicago, whose credit rating is two notches above junk, faces a $20 billion unfunded liability for pensions and $1.1 billion balloon payment next year. Unions (and perhaps investors) were counting on a state bailout, but now they will probably beg Washington for a rescue.
Republican Governor Bruce Rauner has floated an alternative: a state constitutional amendment allowing pension modifications, which would require a public referendum and two-thirds vote of the legislature. Barring that, Illinois taxpayers may want to start contemplating Indiana or Florida residency.
A May 8,2015 Chicago Tribune editorial says the following:
The Illinois legislators who created this retiree benefits debacle will try to shift the blame. Notice how often you hear about “Rauner’s proposed budget cuts” for this and the next fiscal year. As if the newcomer, not his predecessors, devastated state finances.
No, voters understood who caused this. They elected Rauner in the hope that he could lead the salvage mission. Many of the legislators who voted for the provisions now choking state and local governments will fight him every step of the way. . .
. . . So as the slashing of non-retirement costs intensifies, don’t blame the chief executive officers who have to wield the knives. Blame the state and local lawmakers who, over the decades, built this miserable Illinois slaughterhouse.
So, what do Wizbang readers think of this current event taking place in Illinois?
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SIDE NOTE:
The URL to the above-quoted WSJ editorial is http://www.wsj.com/articles/illinois-pension-blowup-1431125048
Reading the editorial was free for non-WSJ subscribers as of May 10,2015. However, at a future time, people might have to have a WSJ subscription in order to read it.
