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He wants the federal government to take over so he can eliminate the pensions.
I suspect McConnell has never taken a close look at public pension protections
Accrued public pension benefits in most states are contracts which are protected by the US Constitution- Ex Post Facto.
Only 2 states, Indiana and Texas, view accrued public pensions as a gratuity that can be altered. Even then, it only applies to some public pensions, some of the time.
Depending on state and type of public pension, the worker is excluded from Social Security. Neither the employee or employer paid into SS and therefore have no claim on SS.
1) We have some really irresponsible and uninformed posters that keep claiming that the pension guarantee fund covers things it does not and then posts some general link as if it's support. Sorry folks, I can claim that Bill Gates is in the baseball HOF and then provide a link to their general website but it doesn't make it true.
2) States cannot declare bankruptcy, under current rules. I don't expect that they will though. Most states have ENORMOUS assets that they could sell off either in terms of land holdings or future collection rights. For example, Chicago sold off it's parking enforcement maybe 10 years ago to a private company. Also take a look at all the prime real-estate along the Chicago shore-line the city owns and could sell and let someone plop down 2 casinos and some hotels there? It would start to seriously add up. (Also mineral rights, logging rights...99 year leases...exclusive deals...etc.)
that's the answer then, put a 8% additional tax on all Illinois income to fund public pension funds. The citizens elected the leaders that made the decisions about pensions, citizens need to pay up. Want to change the system fine, but you have to grandfather those that already receive pensions.
It’s rather fascinating how little attention the topic gets in state elections.
The former governor, a Republican billionaire floated the idea of pushing some or all of the unfunded liability back onto the local governments and school districts who, in times gone bye , negotiated and agreed to the terms. It was the kiss of death.
He was challenged in a primary by a candidate who ran on a platform of cost cutting and persuading unions to agree to reductions of accrued benefits, as if that had not been tried before. She seemed to believe the unions would play ball. She might have won the Republican primary had she chose to not make SSM, Roe v Wade, transgender and religion, issues.
Voters preferred the Democrat billionaire who promised to legalize marijuana and tax the hell out of it and replace the flat tax with a progressive income tax by public referendum.
There seems to be a persistent fantasy that a governor will wave a magic wand and the pension funding crisis will go away. And when that does not happen, they vote another governor in.
Campaigning on the promise to cut costs to the bone and raise taxes is not a winning platform, anywhere.
I suspect McConnell has never taken a close look at public pension protections
Accrued public pension benefits in most states are contracts which are protected by the US Constitution- Ex Post Facto.
Only 2 states, Indiana and Texas, view accrued public pensions as a gratuity that can be altered. Even then, it only applies to some public pensions, some of the time.
Depending on state and type of public pension, the worker is excluded from Social Security. Neither the employee or employer paid into SS and therefore have no claim on SS.
I think people are reading wayyyyy too much into McConnell's comments. Go back to the context and the statement he made, I don't think he's actually pushing for it just people getting frothy over empty words.
The day of reckoning may be near. The Dems are desperately trying to get $1T added to C-19 Porkulus 4 to bail out the states ponzi scheme's..I mean pensions.
To try for a $1T money grab during a time when we have a Republican President, & a Republican controlled Senate, tells you how desperate they are. They can't even wait 6 months to see what November's election results will be.
They see the Feds spending frenzy going on right now, so they are going for it right now; rather than waiting.
That tells me they are thinking....
1) that Joe Biden, or any other Dem, has no chance in November...or...
2) some state & local pensions are in such bad shape, they cannot continue to pay out for 6 more months.
Federal and state govts are scrambling right now to find a solution! they are doing anything and everything they can to remain in control.
They should. Why should taxpayers in Texas bail out the Illinois pension system? The liberal states were warned for decades about their poor financial decisions. Let them go bankrupt.
They should. Why should taxpayers in Texas bail out the Illinois pension system? The liberal states were warned for decades about their poor financial decisions. Let them go bankrupt.
Texas is in a very precarious position due to the oil glut. Texas will be among the first in line begging for a bailout, either directly to the state, or indirectly via bailouts to Big Oil companies, or both. So the problem is, once you play the "why should the citizens of X pay to bail out state Z" game, ultimately X will ask for help too. The whole country is in this together. A global pandemic by definition is a federal problem, not a state or local problem.
I DK about that I live in Illinois. The state Constitution guarantees the state will pay accred benefits, come what may.
In 2011, legislators approved legislation to:
Eliminate the compounded 3% COLA, and
Extend retirement age to 60, and
Disallow the games routinely played to goose the last year income.
Unions sued. Appellate court agreed. State took it to the state surprene court and argued that, the state could not afford these accrued benefits. State Supreme Court to the state to pound sand. The state constitution is clear that accrued benefits are a contract between public plan participants and the state, local government and school districts.
You can't get blood out of a stone. When the coffers go dry Illinois will have to default. McConnell said the Fed wouldn't bail them out. Where Illinois goes from there I have no idea. I side with McConnell on this one--first time in my life, corrupt S-O-you know.
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I don't expect that they will though. Most states have ENORMOUS assets that they could sell off either in terms of land holdings or future collection rights. For example, Chicago sold off it's parking enforcement maybe 10 years ago to a private company. Also take a look at all the prime real-estate along the Chicago shore-line the city owns and could sell and let someone plop down 2 casinos and some hotels there? It would start to seriously add up. (Also mineral rights, logging rights...99 year leases...exclusive deals...etc.)
