This op-ed column from the Washington Post focuses on the fight between Chicago and the state of Illinois over Chicago teacher pensions. The situation is a hot mess, and shows no signs of abating.
What makes this piece reading, however, is its wider framing about how public sector pensions are structured, how retirees are benefitting at the expense of children, and how young teachers are paying disproportionately into a system whose benefits they may never enjoy.
Here are a couple of of our favorite lines:
…absent reforms that reduce school systems’ legacy costs, intergenerational injustice will deepen. In a financially troubled state such as Illinois, where taxes are already high, it seems wrong to exempt any politically influential group of grown-ups from shared sacrifice, while children compete for resources…
…The situation in bankrupt Puerto Rico illustrates what lies at the bottom of this slippery slope: New teachers will soon be contributing 14 percent of their salary to cover $55 million in monthly pensions for 42,000 retirees, even though the younger generation may never see a dime because the fund will be empty by next year, according to a recent New York Times report.
It’s only fair to point out that Illinois teachers, like Colorado teachers, receive their pension payments in lieu of social security. So it’s understandable that they would fight to collect every penny they have been promised.
Still, Illinois in general and Chicago in particular could be the canary-in-the-coal mine for other state and local pension plans, and how this imbroglio is (or isn’t) resolved will offer lessons for the rest of us.