4 ms·

It is almost double the amount cited above, estimated to be $241,000,000,000. https://www.illinoispolicy.org/illinois-241b-pension-debt-still-worst-in-nation-d

• colinmhayes 7y ago
  IPI is the Cato institute of Illinois. Consistent track record of putting conservative talking points above facts.
  • lotsofpulp 7y ago
    While that may be true, the governments have a consistent track record of using assumption that understate pension costs and a track record of underfunding the pensions. History has shown that one would be more accurate if they erred on the side that calculated higher costs, especially since they can kick the can down the road for so long.
  • jdkee 7y ago
    I've actually researched them a fair amount for a course I teach on Fake News at a local college. They have a bit of hyperbole in their pronouncements but are generally factually quite spot on. They do not generally misuse statistics or engage in misleading presentations of data sources. To date, I have not been able to not find a reputable original source or citation for what they claim.
  • rayiner 7y ago
    Conservative talking points flow pretty directly from the facts when it comes to Illinois, and public pensions in general. It's widely acknowledged that most states' assessments of their own unfunded liabilities are borderline fabrications, because they assume unrealistic rates of return. Illinois assumes 6.75-7.25% rates of return on pension investments. The average discount rate for corporate pension plans is under 4% (and even with that low discount rate, they're 90% funded on average): https://www.pionline.com/article/20180430/PRINT/180439976/2017-a-sigh-of-relief-for-corporate-pension-plans-funding https://www.pionline.com/article/20180430/PRINT/180439976/20....
    • toomuchtodo 7y ago
      Is it possible to sue pension plans to force them to assume a more realistic rate of return? To do otherwise is to allow a fraud to continue (overinflated return estimates, causing even further insolvency in the future when those returns don't materialize).
      • vkou 7y ago
        Most of them have adjusted the expectations for returns for any new participants. Reducing expectations for existing participants is the same as defaulting on a loan, and I see no reason for why pensioners should be getting haircuts, while lenders get every penny they are owed.
        • toomuchtodo 7y ago
          I'm not suggesting pensioners take a haircut, but that pension plans need to be forced to shore up their funds sooner rather than later, with taxes instead of borrowing (kicking the can even further down the road). It's the uncertainty that is the issue IMHO.
        • rayiner 7y ago
          Two reason: 1) Pensioner debt in Illinois is about $250 billion, versus $65 billion for other kinds of debt. Any debt restructuring will necessarily have to see pensioners carry most of the water. 2) Defaulting on loans makes it very difficult to access the capital markets for things current and future residents need. (Long term bonds to pay for transit projects, etc.) Cutting pension obligations doesn’t have that problem.
          • vkou 7y ago
            > 1) Pensioner debt in Illinois is about $250 billion, versus $65 billion for other kinds of debt. Any debt restructuring will necessarily have to see pensioners carry most of the water. So make both pensioners, and lenders share the pain. Don't just dump all the problems onto one or the other. It was the lender's fault for not taking into account the possibility of default of a creditor with large outstanding financial obligations.