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Illinois Policy Institute CEO John Tillman on the impact of unfunded pension liabilities on state budgets across the countries.
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-- of which states across the nation now facing a very serious threat to and a half trillion dollars in unfunded pension liabilities.
Our next guest blames the problem mom political leaders that I'm willing to stand up.
Against public sector unions he -- launched a new campaign called the pension -- project and joining us now.
John Tillman CEO of the Illinois policy -- -- -- John.
You know -- in Illinois that's the worst offender when it comes I'm funded liabilities -- 167.
Billion dollars worth of unfunded liabilities in fact.
Only 28% of the system is actually funded it's frightening how can you get.
Into such a mess.
-- just what senator Coburn said too much spending not enough self control and the public employee unions here the government unions.
Really run the show and tell the politicians what to do -- the politicians are very reluctant to say none of them.
Some of the bad news for you is the politicians are trying to bail out.
Get out of this by having the rest of the country bailouts and all the other states -- have been spending too much out of this problem we're trying to stop that.
Now.
While you mentioned is not -- just Illinois -- so all across the country the ad democratic governor of Illinois Pat Quinn suggested the federal government bailout bail out these.
Pension programs.
That he backtracked courses I don't know those are dropping Arab but the look of the backlash if he suffer because of that suggestion.
-- -- suffered quite a bit and in fact he's been very unhappy with this project because we've reported the truth that he said this idea he floated that.
They have certainly back track from but he's still refuses to explicitly repudiate the policy.
And to say not only that -- -- not seek nor nor will they accept a bailout we're waiting for him to say we will not accept a bailout.
-- we would get off his back and move on to California the bottom line as there's a lot of states like Tennessee Georgia and others.
Who've been very responsible relatively speaking.
There's no reason their taxpayers should bail out to the tune of 2.5 trillion dollars people like here in Illinois -- that have done wrong -- California.
So the announcer then -- -- take on the unions to get the concessions that we you know we -- followed the Chicago Public Schools strike that didn't happen did it.
I you know that's a great example everybody thought Miramax it was going to be this tough guy and take on the unions and he was -- moral us in our view rolled by the unions are they got a 17% increase.
The main thing he was going for was teacher accountability through better valuation process -- merit -- They got merit pay off the schedule completely.
This content deal what they just it was gonna cost 295 million dollars.
And the bottom line is teachers still won't be held accountable this is really the bottom one on all of this Ashley.
Is that public employee union members are -- monopoly provider of services to the public.
And they have monopoly control when they withhold their services we don't get those services like what happened here during that strike and that's why we have to reform the system.
-- you know just -- back to the teachers' -- an example you say that history is going to be in the right now by more than a billion dollars next year.
And I another frightening number 71 cents out of every education dollar and Illinois goes to pay -- obtained teacher retirement costs how can they justify that amount of money.
And that's exactly writes every new dollar coming out of the state now -- -- just pay for pensions and so people who care deeply about education in Illinois and frankly around the country.
Really need to understand the only way you're gonna have a kind of resources for public education.
For health care for the porn disadvantages if the public employee unions come to the negotiating table.
And agree to write down these over these overly generous pension packages for the average teacher who retired last year and twenty allow them.
-- with a thirty year career.
Have the equivalent of one point six million dollars in cash equivalent when they retired.
And meanwhile the median income in the city Chicago's 30203.
Dollars that's just unfair burden on working class people to turn public employees in the millionaires -- retirement and John do you think this issue is getting a lot of play in the presidential campaign -- mean unfunded pension liabilities is a massive massive problem but I get the sense is not getting -- much attention.
No and I'd be surprised that they ask about it tomorrow -- but they absolutely should because even though one of the reasons we're doing this now.
Before the crisis has erupted is because very bad decisions the TARP decision.
The GM bailout of the auto bailout then of course the stimulus and January 2009.
All those were crisis decisions.
We don't want to make this decision in a crisis the reporters and tomorrow night jeweler I think as the host tomorrow night should obviously be asking about this do they support.
If federal bailout a prolific -- states like Illinois and California.
So are you mentioned the pension project what are you doing to bring this to attention what are you doing to get -- in congress.
What we have a website up no pension bailout dot com and we launch that was senator Jim dement from South Carolina who's been a courageous leader on this he's been way out front Donna.
He also just released a study through the joint economic committee.
That shows and a slightly different version of the numbers and different model but both of them say basically the same thing it's about a 2.5 to two point nine trillion dollar problem.
That would transfer wealth from them the responsible states to be irresponsible states.
And Jim -- has been really great -- -- we're very excited be working with them on and we'll continue to track your up progress thank you so much John Tillman CEO feels like -- policy institute thank you John -- --
