Big Business still playing old pension-cut tune – AFSCME Council 31

This spring, the corporate fatcats at the Commercial Club of Chicago stirred up enough hysteria to pass legislation slashing pension benefits for future state, local and university employees. But they aren’t happy with the harm they’ve done to undermine retirement security for the public servants of tomorrow–so they’re beating the drums to reduce pensions going forward for current public employees, too.

“The club says pension cuts brought in for new hires earlier this year need to be extended to existing employees,” the Chicago Sun-Times reported.

Why? Because, the Sun-Times went on, “the huge hole in Illinois’ finances is scaring off new businesses.”

One problem. Even the fatcats admit this isn’t true. The Commercial Club’s chief mouthpiece, a corporate lawyer named R. Eden Martin, was pointedly asked in a recent Bloomberg News interview, “You represent a commercial club. Are any of your members threatening to move out of state?”

“I would say no one has threatened to move out of state,” Martin replied.

No, of course businesses aren’t moving out of Illinois. Centrally located, our state is a hub for rail, highways, waterways and air transit. We’re home to 13 million people, including one of the great world cities and many fine universities. Our state has tremendous human and natural resources. And none of those vital components of a good place to do business are going anywhere–so neither are smart businesses.

What Martin’s really saying is that if the state reforms its tax structure–to raise adequate revenue for jobs, vital services, responsibly paying the state’s bills, and making taxes fairer–that is, if state leaders finally do what everyone in touch with reality recognizes is desperately needed, then rich corporate lawyers and their CEO pals might finally be paying their fair share. And heaven forbid that.

Right now, they’re paying the lowest flat income tax rate in the nation–a paltry 3 percent of their enormous incomes. When the average retired state employee’s pension is just $20,000 a year, it’s hard to muster up much sympathy for the titans of the Commercial Club. They include:

* W. James Farrell, retired CEO of Illinois Tool Works whose annual pension is $1.4 million. He also gets hundreds of thousands of dollars more from serving on the boards of various other corporations.

* John W. Madigan, retired CEO of the Tribune Company whose annual pension is more than $220,000, and who cashed in the tune of more than $370,000 for attending a few board meetings of a company called Gilead Sciences in 2008 alone.

* Andrew J. McKenna, a major Republican Party official and donor who scrapes by on more than $1.2 million a year he gets–you can’t say “earns”–by serving on the board of McDonald’s and AON.

* Richard L. Thomas, a retired bank executive whose annual pension is more than $600,000, and

* Our friend R. Eden Martin himself, who in 2008 guzzled more than $330,000 in compensation from two companies where he sits on the board–and that’s on top of the retirement benefits he takes from the law firm, Sidley Austin, where he once worked. (Oddly enough for such a self-proclaimed champion of accountability and transparency, the firm’s pension benefit information is not publicly available.)

If only the pundits and politicians who echo these fatcats’ phony hysteria would consider whether it is truly believable that the modest benefits earned by caregivers, caseworkers and child abuse investigators–or park rangers, police evidence technicians and environmental scientists, to name just a few more essential public employees–are the cause of our state’s fiscal crisis.

In truth, the budget meltdown is the result of decades of abjectly irresponsible elected officials–now and in the past–who failed to (1) pay their share into the retirement systems and (2) raise adequate revenue to do so.

Is it credible that corporate CEOs who luxuriate in million-dollar pensions should get to denigrate the modest retirement benefits and affordable health care earned by retired public servants? Of course not. But as long as the politicians and media mouthpieces keep repeating Big Business talking points and their counterfactual claptrap, we have to redouble our efforts to fight back.

via Big Business still playing old pension-cut tune – AFSCME Council 31.

House OKs borrowing to cover state pensions – Springfield, IL – The State Journal-Register

Pension borrowing — a major (and controversial) component of a state budget plan — finally won approval in the Illinois House on Tuesday after a series of rejections.

The House voted 71-44 to borrow up to $4 billion to cover next year’s payments to the five state-funded pension systems. The bill needed a super-majority of 71 votes to pass, and two Republicans — Bill Black of Danville and Robert Biggins of Elmhurst — provided the needed margin.

“We can borrow money or we can take a hike on our responsibility to pay the pension,” said House Majority Leader Barbara Flynn Currie, D-Chicago. “We have shown we can’t cut $3.7 billion, and we have shown we can’t raise $3.7 billion in revenue. That leaves borrowing.”

Read the full story here:

House OKs borrowing to cover state pensions – Springfield, IL – The State Journal-Register.