We have an interesting public pension problem here in Illinois. It's so interesting that the state's bond rating seems to be the lowest in the country. What's also interesting is that Democrats firmly control both houses of the legislature, and we have a Democratic governor as well.
And things have gotten so bad that the people in charge are actually sensing the need to fix the problem. And to do it without raising the tax burden on the state, which is also pretty high already, overall. And the only way to solve the problem without raising taxes a lot, is to cut back on pension benefits somehow.
But the public labor unions - one of the big Democratic constituencies - do not want that.
So, yesterday evening, the leaders of the state assembly & senate announced they had reached an agreement. And the governor gave it his blessing. But now they need to get enough votes to pass it. And some of those votes will have to be Democratic votes, which will have to occur over union objections.
My prediction is that they will get lots of Republican votes, and a sizable minority of Democratic votes, and they will pass this "fix". I don't know how solid this fix is. Probably not as solid as I would like it. But probably it's an improvement over the current situation. Details are not yet fully public.
Then the law will go to court. The Illinois constitution has some language protecting public employee pension benefits. I don't think this language has ever really been tested. There's a certain broad vagueness to it. Apparently the law has been written with the constitutional protections in mind. I guess we'll see what the Illinois Supreme Court makes of it. I suspect they'll let it slide by.
So, today I am thankful for the continuing spectacle, here in my home state, of Democratic elected officials fighting with the public employee unions, because they ran out of other people's money.
The specter of Detroit's bankruptcy looms.
Our officials wish to avoid that doom.