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Pension reform may quell Quinn’s summer plans

Updated: July 6, 2012 8:49AM



SPRINGFIELD — Gov. Pat Quinn found himself more than halfway home Tuesday with his plan to fix the state’s two most pressing financial problems, but getting the rest of the way is far from assured.

With the passage of his proposed $1-a-pack cigarette tax increase, the Legislature completed work on the major pieces of Quinn’s Medicaid rescue package, which also eliminates state-paid health care benefits for thousands of Illinois residents.

Thanks goodness for smokers, the only taxpayers who are considered not worthy of anyone’s sympathy.

The reigning philosophy at all levels of government these days seems to be that as long as smokers are intent on killing themselves, nobody will mind if we just tax them to death first.

At the same time, a House committee took the first step in advancing Quinn’s cure for the state’s underfunded pension systems — the latest version of which now shifts most of the cost burden to thousands of current state retirees.

Have you heard all that talk about “austerity” coming out of European capitals in recent months? Well, between the Medicaid recipients and the government pensioners, this is our version of it, and as much as we may believe it’s necessary, it’s not going to be pretty for those on the receiving end.

Practically overnight — or at least over the Memorial Day weekend — Quinn switched from endorsing a pension reform plan that fell entirely on current state workers to one that allows them to share the pain with those who are already retired.

Under the proposal advanced by House Speaker Michael Madigan, both current and future retirees would be forced to forego the annual 3 percent cost of living increases to which they are now entitled — or give up their rights to health care benefits.

In place of the old COLA, state retirees would now receive annual increases capped at 3 percent or half of the Consumer Price Index, whichever is less.

Some will say that’s only fair. The main purpose here is to rescue the state worker pension programs before they go bankrupt, and the biggest losers in that case will be the retirees themselves.

I would just remind you that we, the People of the State of Illinois, are their employers, and we made a deal with them that we are breaking. I realize that many of you individually would never have made that deal if it was your choice, and the other alternative is to raise taxes, which nobody is of a mind to do except maybe those state workers and retirees.

But no matter how you look at it, it stinks to take away money that was promised to people who are already retired and likely have no way to replace it. Remember that most of them aren’t getting the big pensions that make the headlines.

I made the same point when Mayor Rahm Emanuel proposed the even more extreme measure of taking away cost-of-living increases for city retirees for 10 years.

Indications in Springfield are that the Legislature has no intention of taking up Emanuel’s proposal for reining in the costs of the city pension funds during the current session — due to end May 31. But it’s certainly a good sign for the mayor — and a bad sign for city retirees — if Quinn and Madigan are willing to cut the benefits of their state counterparts.

The unions are loudly objecting, although you have to wonder if behind the scenes they are working harder to protect their current dues-paying members or their retirees. Either way, they question the constitutionality of any such legislation and promise a lawsuit.

Still, it isn’t the potential impact on retirees that poses the biggest threat to pension reform this year.

It’s a provision in the pension legislation, insisted upon by Madigan, that would shift the employers’ cost of teacher pensions from the state to the suburban and Downstate school districts that employ them.

Republicans aren’t ready to support that idea, nor are some suburban and Downstate Democrats, concerned that it will cause their local schools to raise property taxes or slash costs.

Quinn may end up spending the summer living in the governor’s mansion after all.



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