A Pension Analogy

The following was left as a comment by Mark:

We need a real balanced budget law, not the phony one we have now.

Madigan and Cullerton play Santa Claus and let Rauner play Scrooge.

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The 800 lb Gorilla is pensions.

The Illinois General Assembly and Governors have been playing Santa Claus for 45 years with legislative benefit hikes to underfunded pensions in the very same years annual pension contributions were shorted or skipped, akin to charging the credit card on which you are carrying a balance and shorting the monthly payment.

So the new Governor comes into office and he inherits the pension mess.

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Comparing the annual budget to the pension mess is sort of like standing on the railroad tracks and the tricycle is about to hit you but down the tracks you see this freight train coming.

You stand on the railroad tracks for 45 years.

Over the years you start seeing the lights, begin hearing the horn, the train keeps coming.

Some may see the light at the end of the tunnel in this paragraph.  Others may see a hole big enough to drive two Mack Trucks through.

Some may see the light at the end of the tunnel..

Originally the train was just the engine.

Over the years it added tanker cars, coal cars, hopper cars, Reefers (refrigerated cards), container cars, automobile cars, flat cars, etc.

Now the car is heavier and takes longer to stop.

But it still hasn’t arrived yet.

Maybe the train will never get here.

And this is a special train, it also has passenger cars.

And every year there’s more and more passengers.

All the passengers are retired.

And each year, the new crop of retired passengers is more wealthy than the previous years.

But everyone gets a raise every year.

Life is good on the passenger train.

Pretty predictable.

No risk for the passengers.

Only people outside the passenger train have risk, and only those people not contributing to the passenger train pension plan.

But as the passenger looks out the window, the scenery changes over the years.

Foreclosure signs on houses, more and more houses are not kept up as nice, factory closings, McMansions appear, a closed shopping mall here, a high rise office building there, more delivery trucks carrying packages ordered over the internet, the world is changing.

But the train still hasn’t arrived.

The passengers holler out the window, a pension is a promise, we need more money.

And the money keeps coming.

The train keeps on rolling.

Maybe it’s a magical perpetual train.


Comments

A Pension Analogy — 3 Comments

  1. Until honest people with a sound moral foundation start running for office, this problem will never be resolved peacefully.

  2. It’s going to hit when the pension funds go broke and the unions go to the State and demand that they be paid from the General Revenue fund.

    Membership in a pension plan and the right to undiminished payments from the plans is a Constitutionally guaranteed right, but the State is under no obligation to fund that obligation.

    Public employees are playing with fire if they continue to stand firm on what they think is a rock-solid guarantee that they’ll never lose their pensions.

    It would be better for them to now go to the bargaining table and work with those who want to preserve some sort of retirement system.

    Their union leaders are doing them no favors.

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