So says the Commercial Club of Chicago.
In a memo to its members, the Civic Committee of the Commercial Club of Chicago said last week’s elections didn’t bring in an influx of lawmakers willing to deal with the pension crisis but instead leaves taxpayers with “more legislators who aren’t prepared, or willing, to make the tough decisions necessary to save our state.”
“We are writing today to let you know that the pension crisis has grown so severe that it is now, unfixable,” said the letter co-signed by Miles White, chairman of the Commercial Club; Jim Farrell, chairman of the Civic Committee, and Ty Fahner, president of the Civic Committee and Commercial Club.
Miles White is the Chairman and CEO of Abbott Labs. Jim Farrell is the retired Chairman and CEO of Illinois Tool Works. Ty Fahner is a partner at Mayer Brown where he handles tax, bankruptcy, and securities matters. These are not dumb guys. They understand finance and are used to dealing with large numbers.
The headline is of course misleading; the problem is fixable. It’s really just that every week that’s wasted means the solution will be more painful. The Commercial Club outlines what it thinks needs to be done:
- All cost-of-living increases need to be eliminated for retirees, who now get annual 3 percent pension boosts.
- A cap on salaries must be imposed upon which pensions can be based.
- The retirement age for full pension benefits needs to be raised to 67.
- Downstate and suburban school systems must be forced to take on pension payments from the state for educators over a 12-year phase-in.
This is pretty painful for the pension members. Naturally there will be some pain on the taxpayers as well. It’s a bad situation that’s only getting worse by the day.