GARS, the Illinois General Assembly Retirement System, is only 13.52% funded, down from 17% funded in 2013. How long can GARS last?
Meanwhile, Illinois has accrued a combined net pension liability of roughly $130 billion on which it assumes a 7% return.
Effectively, that is an interest liability of $9.1 billion a year even though that liability technically does not bear interest.
Violations of Expectations send amygdalae into high gear. So not only will these people see the stress of shortage and uncertainty, they will also feel the sting of how it was not supposed to be. When these pension systems go down in the Apocalypse, you will see epic levels of amygdalae, and high amygdalae is what provokes wild behavior.
Those pensioners will be a real wildcard, and I would not want to be the politician who screwed them.
Thell others about r/K Theory, because it reduces violations of expectation.
[…] Illinois Pension System Going Down […]
I doubt that the collapse of pension systems will matter much because the people affected by it are by and large too old to matter much when the apocalypse comes. Sure, in the present system they can vote, but how long do think will it last that voting might matter? They can’t riot, they can’t fight, they can’t offer much work.
Dan Rostenkowski might beg to differ. He spearheaded changes to Medicare a few decades back. The old goats were picketing when they saw him on the street, and by that age a lot of them felt they had nothing to lose. They chased him around until he saw his driver parked by the side of the road and hopped in his car. They surrounded it and began beating on the windows, and he thought he was going to be dragged from the car a Mussolini’d. Next thing you know, Medicare was back to the way it was.
A lot of those old guys are pretty crotchety by that age. I wouldn’t be surprised if they are the first ones to start offing congresscritters.
Most pensioners are older individuals. I know that, in the past, politicians have been afraid of retired people on SS or pensions because they vote, don’t have to spend much of their money on debt, and have the time to make themselves politically active. However, I watched how easy it was for the left and the establishment to shut down the Tea Party, which consisted mostly of older Americans. Older people are more frail and spend much of their time somewhere in the Medical system. They are insecure about themselves and the economy. I feel that they will be the easiest sector to cow. They would accept a lesser pension if it was guaranteed. Or, rather, if they were told it was guaranteed, subject to review in 2 years. Young anti-fa’s, blacks, and anarchists, none of which are real men, will enjoy kicking oldee butt.
Extrapolating the funding means that IL won’t have a pension system by 2030, but one could make the argument that withdrawals will accelerate as funding goes lower. It will be interesting to see how IL coughs up $10B a year right as Chicago is going broke. The Teachers Unions may have to find other lines of work.
I submitted a comment earlier. It said submitting reply. The reply is not there. I am having trouble posting at another site and I wonder what the problem is. Is there an issue I should no about?
Let me know if it doesn’t pop up in a day or so. The comment section here is buggy, with comments unapproving, getting spammed, and sometimes disappearing. Of course if you are having trouble at another site as well, there are ghosts in the machine.
Thanks.
Ah, but “we” keep pretending that these pensioners aren’t the authors of their own misfortune. All of these politicians are democratically elected, and all of these people chose to, at best, allow them to give the farm away for two generations. Where is the honesty in American public life? Who projects a 7% return on pensions in an economy of 0% growth? Dishonest people elected by dishonest voters, that’s who. Not much better up here in the frozen north, but at least our parliamentary system provides for accountability – we can throw the bums out – and our public pensions, having been reformed, are on, not solid, but much better ground.
I’m a retiree of one of the other Illinois state pensions (SURS, the one for state universities.) It’s apparently still in better shape than the report here for legislators. But I’m sure the legislators will make sure the entire state goes belly up before giving up a single penny of whatever they feel owed to them in their pension.
Update: The current funding of SURS as of June, 2016 is 43% – not good, but thinking only of myself, may well be enough to see me through my remaining years.
I hope it works out for you.