Pension Benefit Growth Overwhelms Illinois Economy
The State of Illinois is desperately in need of pension reforms.
Tonia Khouri has made pension reform one of her key issues in the 49th District race.
Nearly 25 percent of general fund state revenue is consumed by government employee health insurance and pensions. This results in schools, police, seniors, and veterans not getting the funding they need, as well as more income tax hikes, and more people leaving Illinois.
The pension promises made by Illinois politicians have been extreme and unsustainable.
The answer to the pension problem is not the statewide property tax increase proposed by the Chicago Fed or the “progressive” income tax hike proposed by Mike Madigan and the Democrats.
This graphic below from Wirepoints captures the absurdity of Illinois pensions over the past three decades.
Here is the original story as published by Wirepoints:
One graphic perfectly captures the absurdity of Illinois pensions over the past three decades.
It’s what Justice Samuel Alito described as Illinois’ “generous public-employee retirement packages” when writing for the majority in the Janus v. AFSCME decision. “Illinois’ pension funds are underfunded by $129 billion as a result of generous public-employee retirement packages” he wrote.
Alito didn’t use the graphic below, but he could have because it makes his point.
In 1987, pension promises made to active workers and retirees in the state’s five state-run pension plans totaled just $18 billion. By 2016, they had ballooned to $208 billion.
That’s a cumulative 1,067 percent increase.
Contrast that to the state’s budget (general fund revenues) which was up just 236 percent over the same time period. Or household incomes, which were up just 127 percent. Or inflation, up just 111 percent.
Promised pension benefits have blown past any ability of the state, the economy or taxpayers to pay for them.