Despite the dire financial condition of his state, and the fact that it was (and still is) a sovereign deadbeat that fails to pay its bills, Illinois Democratic Gov. Pat Quinn found room to cut a sweetheart deal with its public employee unions in September. They were guaranteed two years of cost-of-living increases and no layoffs. Quinn, in turn, got the union’s endorsement and won his 2010 election by less than 1 percentage point. This provides a dramatic illustration of what has for years been political business as usual for liberals in public office. To save their own jobs, they cut deals with your money, offering premium benefits and exorbitant salaries to public workers. Much of the cost is deferred until these employees retire, and so the unfunded liabilities of public pensions have become enormous, threatening states and cities with imminent insolvency. By some estimates, state and municipal governments will have to come up with $3.5 trillion in new funds just to keep the pension checks going out. Things are so bad in California that state officials had to commission an independent Stanford University study just to get a handle on its pension liabilities, which turn out to be a staggering $535 billion.
Print subscriber? Click here to login/register your account
Digital subscriber? Click here to login/register your account.