Saturday, January 12, 2013

Illinois Bond Ratings or Public Employees Are Held Hostage in Illinois (and Letter to Legislators)

By Benjamin Yount | Illinois Watchdog

SPRINGFIELD — It could be the week of “I told you so” in Illinois. Lawmakers, as expected, failed to act on pension reform early in the week, and Illinois’ credit, as expected, suffered by week’s end… Fitch Rating Service on Friday put Illinois on its negative watch list after lawmakers failed to even vote on a pension reform proposal. The statement from Fitch  says Illinois has six months to act before the rating service will review its rating of the state’s credit. But it is not just Illinois’ $96-billion pension debt that is troubling Fitch. The statement also specifies Illinois’ nearly $9 billion in unpaid bills and a dependence on late payments to manage the budget…

Senate President John Cullerton said the new General Assembly will have to find a way to balance pension obligations with the needs of 13 million people in the state of Illinois. “We are on the verge of our state budget being turned into a financial plan that funds pension benefits, not essential services,” Cullerton said.

Dear Illinois Representative and Senator Who Supports Pension Reform:

Pension reform is the wrong solution for the state's financial predicament. It is the wrong solution because the State of Illinois has a revenue and pension debt problem. It is obvious and unfair that the wealthy elite are not part of the solution for the state's budget deficits but public employees are. The vast accumulation and hoarding of wealth by the financial elite, while most people live modestly or impecuniously, is abjectly wrong.

Where is your humanity? Where is your empathy and integrity? Why would you consider passing a pension reform bill that places an unreasonable discrimination upon teachers and other public employees for the sake of benefits for the wealthy and Bond Ratings Is it because of your lack of resolve to do what is equitably and morally responsible? Is it because it is easier to deceive the Illinois citizenry and blame the state’s financial debts on public employees?

Is it because you are held hostage by a rigged system perpetuated by the Civic Federation and the Civic Committee of the Commercial Club of Chicago? Is that why you aren’t outraged by a system of government that exempts the wealthy from so-called proposed “pension reforms” and eliminates taxation for major corporations; by a system where money precludes changes for a corrupt political system, where the rising inequalities that continue to exist in Illinois are funded by powerful and wealthy interests’ groups, where the legislators’ self-serving flat-tax rate that they refuse to transform proffers unequal opportunities and quantifiable payoffs for the largest corporations' executives and, thus, ensures benefaction for a legislator's re-election campaign?

Have you forgotten your Oath of Office? Voting for pension reform will reveal to your constituency that you are avoiding your "honorable duty" and obligation to uphold the State and U.S. Constitutions. It is on behalf of legal and ethical concerns to increase the state’s revenue and to tax more fairly the state's multi-million-dollar corporations and the wealthy elite so the public pension systems of Illinois can be properly funded without ill-advised, extreme prejudice. Reform the “Pension Ramp” and not the public employees’ constitutionally-guaranteed earned pension.

It is noteworthy that the exploitations of governmental policies, that are often written or subsidized by the Civic Federation and the Civic Committee of the Commercial Club of Chicago, create a financial deprivation for the vast majority of people in the State of Illinois. Each new tax break for the wealthy means less money to run the state’s government; it requires policymakers to get money elsewhere and to cut essential services.

Pension reform will never be enough for all the state's debts and for profiteers. The Civic Federation and Civic Committee, et al. will continue to blame the public employees’ pension for the  state's lowered bond ratings and reductions of their corporate earnings. Members of these organizations are concerned about their insatiable profits and not the lives of public employees and other middle-class citizens. Despotic governmental policies, like pension reform, will not revive the Illinois economy and produce jobs. They will have a negative economic impact on the state’s economy because retirees and public employees (middle-class taxpayers) will be forced to reduce their spending.

Consider that of the nearly 88,000 retired teachers in TRS, there are approximately 52,000 pensions below $50 thousand; more than 17,000 of them are less than $20 thousand (TRS). These people do not receive Social Security and, if they do, it is minimal. To further reduce the COLA for these people would lead to the impoverishment and destruction of their right to self-preservation. (Reflect upon the fact that a “simple” COLA of a mere $600. (SB 1) will not be sufficient for keeping pace with inflation for current teachers when they retire, and that the wealthy members of the Civic Committee, Civic Federation and the Illinois General Assembly will never have this concern).

It is incongruous that nothing in pension reform will address the revenue problem in the State of Illinois. What will be certain if pension reform is passed are costly lawsuits at the taxpayers’ expense to defend what is explicitly stated in the Illinois Constitution’s Article XIII – General Provisions, Section 5. Pension and Retirement Rights: “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,” and what is also unequivocally stated in Article I – Bill of Rights, Section 16. Ex Post Facto Laws and Impairing Contracts: “No ex post facto law, or law impairing the obligation of contracts or making an irrevocable grant of special privileges or immunities, shall be passed.”

With the enactment of a pension reform bill, legitimate rights and moral precepts are in jeopardy not only for public employees but for every citizen in the State of Illinois. Defrauding a person out of his or her originally-guaranteed rights and earned benefits violates a most important interest in morality and basic legal principles of both the State and U.S. Constitutions that protect every citizen. An attempt to break those constitutional guarantees, through the likes of the Civic Committee of the Commercial Club of Chicago’s Sidley Austin LLP, will be a costly and dangerous effrontery and precedent to set in motion.

Sincerely,

Held Hostage in Illinois

No comments:

Post a Comment