Daniel Webster School, a CPS school on the West Side

By John Ruberry

On Friday a friend of this very blogger forwarded a Chicago Tribune Breaking News Alert to me: Chicago Public Schools enrollment drops by nearly 10,000 students. And the year before CPS enrollment slid by 11,000.

There are 371,382 students taking classes in CPS schools  In 2002 there 438,589 kids running the halls, with some of them learning something.

So, taxes for schools will go down, right?

Not in the Prairie State, the home of “Illinois Math,” where two plus two equals five.

For a while, that is.

CPS is expected to raise property taxes soon–a state bill that will likely pass to pass gives them that power–by $120 million to pay for, wait for it, teacher pensions. That’s on top of $100 million in a tax jump already sanctioned

“Building a New Chicago” at Dunne School on the South Side, where your blogger attended kindergarten

The sad tale of the Chicago Teachers Pensions Fund [CTPF] goes back to 1981 when the Chicago Board of Education agreed to pick up most of the teachers’ obligation to pay into their pension plans. Out of sight–out of mind. Yes, Chicago Teachers Union, I’m looking at you! In 1995 a lost weekend of retirement funding began–it lasted ten years–and all of that money that was supposed to go to pensions instead went towards teacher salaries and nuts-and-bolts school expenses. Oh, don’t forget to throw in a calorie-loaded Chicago-style pizza buffet line of cronyism, giveaways, and malfeasance into this toxic dish.

Illinois still hasn’t completely recovered from the Great Recession–government corruption and incompetence, in my opinion, are the sole reasons for that–so naturally a partial CTPF “pension holiday” was declared from 2011-13 and the can was kicked down the potholed road again.

Chicago Public Schools bonds are rated as junk.

Two years ago Chicago property owners had to swallow the largest property tax hike in the city’s history to help shore up police and firefighter pension funds, which are even more underfunded than the teachers’ pensions. And last week Chicago’s embattled mayor, Rahm Emanuel, released his 2018 budget proposal, which of course includes tax increases. When asked if more tax hikes were coming, Emanuel dodged the question.

Chicago is the only large American city with a shrinking population.

As bad as Chicago’s financial situation is, the reality is probably far worse because Illinois Math is very likely disguising the wretched truth.

Decline and fall.

Blogger in downtown Chicago

Here is some more Illinois Math for you: The free-market Illinois Policy Institute says, “There are now more inactive employees and beneficiaries in CTPF than there are active workers paying into the pension fund.”

Someday there will be a new Illinois Math equation. Two plus two won’t equal five–it will equal just one.

John Ruberry regularly blogs at Marathon Pundit.

By John Ruberry

I hate to interrupt your day by veering away from such issues, well, issues to some, such as the Donald Trump campaign’s alleged collusion with Russia or that nation’s reputed hacking of the 2016 presidential election, but there is something more important that the mainstream media is only nibbling at the edges of: the Great American Pension Swindle.

What is it?

Underfunded pension plans in blue states, well mostly blue states.

Here are some media headlines from just this month:

I could go on and on.

As for that last one, many bond firms rate Chicago Public Schools’ bonds as junk. The collateral for its latest loan, and that’s a generous use of the term, is money owed to CPS by the state of Illinois, the Puerto Rico of the Midwest. Illinois’ public-worker pension plans are just 29 percent funded. Chicago’s pensions are worse–at 25 percent funded, the worst among 15 large cities surveyed.

I don’t have Schadenfreude over this situation. On a personal level the spouse of a friend of mine and one of my cousins are collecting Illinois State Police pensions. They were promised these retirement plans and they didn’t pay into Social Security when they worked for the state. There was no opt-out option for them in regards to these pensions. And their union, unlike AFSCME, wasn’t showering Illinois politicians, mostly Democrats, with copious campaign contributions while the state was shortchanging and even skipping payments into pension funds.

Now what?

John “Lee” Ruberry of Da Tech Guy’s Magnificent Seven

I suspect bankruptcies in all but name, which I wrote about earlier this month in this space, are coming to Illinois and other states who see pensions as a reward system for political sponsors such as AFSCME. Here’s another possibility: run-of-the-mill taxpayers, many of whom are just getting by financially and have no pensions of their own, nor the ability to retire in their 50s, will have to cough up even more in taxes to bail out public worker retirement funds.

This tragedy is not the fault of the Russians. Vladimir Putin didn’t hack the pension funds.  But too bad that’s not what happened. Then perhaps MSNBC, CNN, the Washington Post, and the New York Times might devote more time to the Great American Pension Swindle.

John Ruberry regularly blogs at Marathon Pundit.