Editorial: Pension plan weak
Editorials May 6, 2013 8:04PM
Illinois Senate President John Cullerton
Updated: June 8, 2013 6:19AM
It is not enough.
Illinois will continue to stagger beneath the burden of public employee pensions it cannot afford, which increasingly will crowd out most other essential spending — and likely force big tax hikes — for decades to come.
Illinois Senate President John Cullerton on Monday revealed a union-backed pension-reform proposal that falls woefully short of a prescription for good financial health. It would trim the state’s pension debt by an estimated $46 billion over 30 years, which is less than a third of the $150 billion savings projected in a pension bill approved by the House last week.
The union-backed plan pales in comparison even to Cullerton’s own insufficient original plan, which projected an estimated savings of up to $65 billion.
This latest plan stands a marginally better chance than the House plan of passing constitutional muster, and it reflects a welcome new willingness by the unions to make painful concessions in the face of reality — the state’s $98 billion (and growing) pension debt.
It’s the first time the unions have agreed to any kind of reduction in cost-of-living pension increases for retirees, which is where any real savings must come from.
But the same feature intended to strengthen the union plan’s constitutionality — it offers employees a choice in the matter — also means the plan’s modest $46 billion in savings is not at all certain. In contrast, the state can bank on the much larger savings created by the plan pushed through the House by Speaker Mike Madigan last Thursday.
Cullerton pointed out that because this bill has union backing, it will be easier to pass in the Legislature and less likely to be challenged in court. We can agree with him on that first point, but not the second. Any state employee, unhappy to see his benefits cut by a penny, can sue, and somebody will.
The union-Cullerton bill will be sent to the Senate’s executive committee for action on Wednesday, with a full Senate vote likely on Thursday.
Our hope is that it will fail, and that the Senate then will turn around and support the House pension package, which offers real and substantial reform for a generation to come.