Correspondence

Flyover Math

In January, George Mason University published a survey of the financial solvency of our country’s 50 states.  Illinois came in at 48th place, just in front of Connecticut and New Jersey.  The Land of Lincoln caught a bit of a break, it seems.  Perhaps the extent of Illinois’s legacy pension and healthcare costs was not fully appreciated by the survey’s author.  In the world of overboard promises to public employees, Illinois is quite the outlier.

To understand the extent of the crisis, you need a little background information.

Once upon a time in public life in Illinois, municipal, county, and state employment was a much less lucrative proposition than it is today.  Public-employee wages lagged far behind commercial rates.  After World War II, governmental bodies began to add health-benefit packages and defined-benefit pension programs to compete with commercial employers.  As in the rest of America, overall wages grew rapidly in the 50’s and 60’s, and public wages, too, trended upward.  By the 70’s, the United States had begun to deindustrialize in earnest.  Because Illinois was an industrial powerhouse, the state was hit especially hard by this trend.  Responding to increasing pressure, many commercial employers dropped their defined-benefit pension plans in favor of defined-contribution and private-savings...

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