It’s official: Illinois has surpassed California as America’s #1 financial basket case. Last night in the dead of night, democrats, with no assistance from the GOP, raised our income taxes, ostensibly to “pay our bills.” Pay our bills? As in maintain our roads and other infrastructure? No, not exactly. To shovel more dough into the pockets of their public employee union clients.
One study by the Illinois Policy Institute examined pension records and found that today there are 536 retirees collecting an annual pension of $100,000 or more. Some collect more than $200,000. The taxpayer tab for those 536 pensions alone is $68.2 million a year. It costs the state about $4 billion annually to make the necessary pension contributions—and the system is still underfunded. Those annual pension costs are expected to rise to about $6 billion a year in the next few years.
So when you include health-care costs, nearly 20% of the state budget is going for payments to retired teachers, bus drivers and clerks (rather than roads, schools, courts or fire houses). If Illinois’s public-employee retirement system were a 401(k)-type plan, which is now the norm in the private sector, this $6 billion annual expense would go away.
Last year the Illinois legislature passed a pension-reform bill that ends this gravy train for newly hired workers. But as a sop to the unions, the bill didn’t apply to workers who were hired before January 2011, which means that existing state workers are exempt. Because the law didn’t take effect until this year, the state has to eat the $488 million in higher costs for those lucky workers—19,000 of them—hired between the time the bill was voted on and Dec. 31.
Common-sense pension reforms for all Illinois state workers, not just new hires, plus other reasonable spending cuts, would save enough money to head off the looming tax increase that Democrats are intent on pushing through. But Illinois residents should know the real reason that their taxes are going way up and jobs are harder to come by: so that union pensioners can live high on the hog.
When even Gov. Moonbeam knows that it’s time to stop his state’s reckless spending, especially that devoted to appeasing the privileged public employee union class, it’s clear that only those completely disconnected from reality don’t realize that enough is enough, which perfectly describes Illinois democrats. To those who voted for Pat Quinn for governor, thanks a lot for making this job-killing tax increase a reality. Way to go!