Illinois Pension asks US for $40 Billion Bailout

[middle-aged mom]

Originally Posted by michiganmoon

McConnell is correct.

He said that he was open to amending the law to allow states to file for bankruptcy. This is 100% possible assuming he has the votes even if you don't agree with it.

https://www.google.com/amp/s/www.wsj...ss-11587601346

Amending the Federal Bankruptcy Code to allow states to file for bankruptcy is possible, assuming there are the votes and POTUS agrees.

Ex Post Facto language in the state and US Constitution would protect accrued public pensions. Not so much for bond holders and other debtors. SCOTUS would need to sort it out.

In the mean time, the uncertainty and a trustee liquidation of state investments would tank global markets.

[middle-aged mom]

Originally Posted by Pilot1

This is why IL and other states have a Pension funding problem. When did government jobs become so lucrative?



https://www.zerohedge.com/markets/wh...-taxpayers-14b

^are all suburban school districts, including my own, a very Republican area. What a superintendent makes is not reflective of all teachers. Compensation is determined by publicly elected school boards.


Former Republican Governor Rauner floated the idea of pushing back all or some of the school and local pension obligations onto the school districts and local governments that negotiated and agreed to compensation and benefits. My school district would take a huge hit. The public outrage was huge.

He was primaried by a person who vowed to cut state costs to the bone and magically persuade the unions to reduce accrued compensation and benefits. The incumbent won the primary and lost the election.

Now suddenly, it’s all Pritzger’s fault.

[middle-aged mom]

Originally Posted by TEPLimey

Want to see the markets really tank? Give the States the chance to file for bankruptcy. Holy smokes.

Just the uncertainty associated with how a state could bankrupt would send global markets into a tailspin.

I will be very surprised if Mitch sponsors a bill to amend the Federal Bankruptcy Code.

[Mircea]

Originally Posted by hbdwihdh378y9

McConnell is wrong.

https://www.law.cornell.edu/uscode/text/11/109

"[O]nly a person* that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title.


* "Person" includes partnerships and corporations.

Excellent work.

Originally Posted by middle-aged mom

Amending the Federal Bankruptcy Code to allow states to file for bankruptcy is possible,....

Originally Posted by michiganmoon

McConnell is correct.

No.

The issue has absolutely nothing to do with bankruptcy code.

The Contracts Clause of the US Constitution forbids States from discharging debts. Period. End of story.

You must first amend the US Constitution to strike the Contracts Clause or modify it to permit bankruptcy by States.

After you amend the US Constitution, Congress can amend the bankruptcy code to include States.

The US Supreme court has repeatedly and continuously rejected any attempt by a State to avoid its obligations, except in those cases where the contract resulted in the State surrendering an essential part of its sovereignty.

The economic consequences of allowing States to file bankruptcy would be unfathomable and your life would become totally miserable.

If you think you're being taxed to death now, you ain't seen nothing yet.

If you think government is over-reaching now, you ain't seen nothing yet.

If States can file bankruptcy, no business will enter into a contract with a State.

Why would I contract with a State to built 18 miles of road on I-70 or I-80 or I-75 or I-95?

I wouldn't. I'm not going to do all that work and then have you file bankruptcy and then I get nothing and then I have to file bankruptcy because you discharged your debts.

So, what are the options?

1) States hire construction crews as government employees and you the tax-payer pay them year round and at union wages even if you don't need them, because unions will make sure of that.

2) Pay for all contracts up front.

Either way, the State will have to tax the holy hell out of you.

State bankruptcy would destroy States economically, financially and demographically as people flee.

The Framer's of the Constitution understood that, which is why they forbade States from discharging debts.

[hbdwihdh378y9]

Originally Posted by Pilot1

Our auditors discovered 110,000 public employees and retirees who earned more than $100,000 last year.

No, they discovered 110,000 public employees and retirees who *were paid* more than $100,000 last year. Whether they earned it is another matter.

[blahblahyoutoo]

Originally Posted by beach43ofus

https://www.city-data.com/forum/57854511-post24.html

I've been sounding the alarm on unsustainable Gov't worker pensions since I joined C-D 3 years ago.

So much so, by now, most of you think here goes Beach again with anotehr one of his pension rants.

The link above from 2 days ago (April 17th), mentions Illinois specifically. I saw this bailout request coming a long time ago.

I wasnt the only one to see it. Here's a Thread from Jan 26th that also called out Illinois... Lovescrowds was all over it too:

https://www.city-data.com/forum/57185880-post1.html

Should other States bailout Illinois? NO

I'm so pleased to see that most of us feel the same way. Unfortunately, in the end, pensioners will get shafted, and those responsible will walk.

hunt down those that signed it into law and hold them personally responsible. garnish a portion of their pay. if we let incidents like these go without consequences, behaviors will not change.