What a nonsensical cup of kool aid provided by a sinister cabal of managers, employees and union members of the “too big to fail” outfits and the bureaucrats who were supposed to oversee the activities of the “too big to fail” outfits and didn’t. So these groups go to their co-dependent enablers in DC and beg for handouts and loans and guarantees and stimulus payments and their political sycophants wring their hands and say oh woe unto me and the poor taxpayer and they huddle with their knees knocking, terrified that the excretion will hit the oscillator and they will be responsible so they say, “too big to fail”, oh woe, oh woe, and eureka, they write checks on other peoples accounts and then they run around saying we saved it, we saved it, oh how wonderful we are.
TheFundamentals has composed a historical list of organizations, individuals, entities and gatherings deemed to be “too big to fail.” Please add your own as we were limited by time and interest.
Ma Bell (1885 – 1984)
Roman Empire aka SPQR (27BC - AD476/1453)
Packard Motor Company (1899-1958)
Brooklyn Dodgers (1883-1957)
British Empire (1583-1945)
Union of Soviet Socialist Republics (1922-1991)
Third Reich (1933-1945)
Edsel car (1957-1959)
Methuselah (969 years)
Noah (950 years)
Adam (930 years)
All gone; sun still rises.
Here are a few of Barry, Barney and Ben’s too big to fail outfits: AIG, Bank of America, Bear Stearns, Citicorp, Chrysler, Fannie Mae, Freddie Mac, General Motors and Goldman Sachs
Here are a few of Barry, Barney and Ben's real too big to fail outfits that you will never hear them mention: UAW, AFSCME, SEIU, AFT, NEA, ABA, AFL-CIO and the 22 million getting a government paycheck. As da’ coach used to say, “Who ya’ crappin’?”
The collective cost of these bailouts is measured in the many hundreds of billions of dollars; borrowed and printed money; all future claims against Ameican productivity. The solution. A very simple and time tested concept, a fundamental. It’s called an auction. Ben, Barry and Barney, “Call an auctioneer.” Cash out and go back to buying votes and riding around in limousines and get out of the business of business. Who ya’ crappin’?
Wednesday, October 28, 2009
Monday, October 26, 2009
Revolution of 2010 ??
Please read the following excerpts from yesterdays Chicago Tribune editorial entitled - The revolution of 2010.
“The current generation of state lawmakers also contemplates the abyss of debt Illinois has excavated for itself and . . . only digs deeper. State government progressively approaches the "financial implosion" famously predicted three years ago by the Civic Committee of the Commercial Club of Chicago. For lack of stiff spines in Springfield, the unfunded liability of state pension funds alone now totals some $80 billion. State retiree health obligations? Another horrorfest. And every day these unmet obligations only grow. Republican and Democratic governors alike have approved budgets that don't bother to pay for many of today's costs -- chiefly pensions and other benefits for state employees -- with today's revenues. Short on cash? No need to live within Illinois' means, Springfield repeatedly has intoned. Let's just delay paying overdue bills. Or borrow billions. Or both!”
The editorial also includes a graphic depiction of the geography of the state with the caption, “state of corruption.” The above editorial can be viewed in its entirety at
http://www.chicagotribune.com/news/opinion/chi-1025edit1oct25,0,2682341.story
The editorial ends with the following, “The people of Illinois then will determine, come Feb. 2 and in the Nov. 2 general election, whether "The Revolution of 2010" is just a catchy phrase -- or an ode to the year energized voters change Illinois.”
Revolution is defined as a fundamental change in power and/or organizational structure within a short period of time. It can occur peacefully or otherwise. It the case of governments it does require a replacement by the people governed of the existing government structure and personnel.
Corruption is traditionally defined as abuse of power and personal gain by public officials and employees through illegal means such as bribery and extortion. Corruption is much more than that. TheFundamentals defines corruption as the forced excessive payment for comparable goods, services and labor than is either necessary or available and attained elsewhere by others for less.
For non Illinois readers, all that needs to be changed to make this editorial applicable to your state is the $$$ amount of unfunded state pension fund liability and the name of your state capitol. If you are skeptical, just click on the links at left under the captions “Feeding at the Public Trough” and “Within our Means.” The Tribune’s prediction of “financial implosion” has widespread applicability. Many places have already imploded and are being artificially inflated by the corrupt spending, borrowing and money printing policies in Washington DC.
The overwhelming financial problem in all government fiscal activities is the rising proportion of personnel costs as a percent of total revenues. There are absolute limits to how much government entities can tax. There must be statutory limits to how much they spend and the commitments they make to funding employee costs, benefits, pensions and support activities. Government budgets are overwhelmed by personnel costs for wages, benefits and pensions that now consume revenues needed for infrastructure (roads, bridges, tunnels, school repairs and constructions) and other necessities such as public transportation, health care, social services and other goods and services that can and should be purchased through competitive bids from private concerns. Public employment is at record levels indicating a massive anomaly to the productivity and efficiencies that are realized in the private sector. State and local employment is a record high 19.7 million. Federal government employment is a record high 2.7 million. Over 22 million (a) people are on government payrolls!!!! The payroll costs for all these employees, coupled with the needed buildings, offices, desks, automobiles, trucks, uniforms, weapons, training sessions, conferences, computers, managerial staff, vacations, health insurance and massive pension program benefits is overwhelming limited tax revenue sources at the very time the private sector is cutting back to realize increased productivity and efficiency. This situation cannot be cured through curtailment. It requires drastic cutbacks, drastic permanent layoffs and drastic changes to benefit and pension program terms and funding. It must start in November 2010.
(a) Interested readers can go to http://www.census.gov/govs/apes/index.html and examine the details of these numbers including state specific statistics.
“The current generation of state lawmakers also contemplates the abyss of debt Illinois has excavated for itself and . . . only digs deeper. State government progressively approaches the "financial implosion" famously predicted three years ago by the Civic Committee of the Commercial Club of Chicago. For lack of stiff spines in Springfield, the unfunded liability of state pension funds alone now totals some $80 billion. State retiree health obligations? Another horrorfest. And every day these unmet obligations only grow. Republican and Democratic governors alike have approved budgets that don't bother to pay for many of today's costs -- chiefly pensions and other benefits for state employees -- with today's revenues. Short on cash? No need to live within Illinois' means, Springfield repeatedly has intoned. Let's just delay paying overdue bills. Or borrow billions. Or both!”
The editorial also includes a graphic depiction of the geography of the state with the caption, “state of corruption.” The above editorial can be viewed in its entirety at
http://www.chicagotribune.com/news/opinion/chi-1025edit1oct25,0,2682341.story
The editorial ends with the following, “The people of Illinois then will determine, come Feb. 2 and in the Nov. 2 general election, whether "The Revolution of 2010" is just a catchy phrase -- or an ode to the year energized voters change Illinois.”
Revolution is defined as a fundamental change in power and/or organizational structure within a short period of time. It can occur peacefully or otherwise. It the case of governments it does require a replacement by the people governed of the existing government structure and personnel.
Corruption is traditionally defined as abuse of power and personal gain by public officials and employees through illegal means such as bribery and extortion. Corruption is much more than that. TheFundamentals defines corruption as the forced excessive payment for comparable goods, services and labor than is either necessary or available and attained elsewhere by others for less.
For non Illinois readers, all that needs to be changed to make this editorial applicable to your state is the $$$ amount of unfunded state pension fund liability and the name of your state capitol. If you are skeptical, just click on the links at left under the captions “Feeding at the Public Trough” and “Within our Means.” The Tribune’s prediction of “financial implosion” has widespread applicability. Many places have already imploded and are being artificially inflated by the corrupt spending, borrowing and money printing policies in Washington DC.
The overwhelming financial problem in all government fiscal activities is the rising proportion of personnel costs as a percent of total revenues. There are absolute limits to how much government entities can tax. There must be statutory limits to how much they spend and the commitments they make to funding employee costs, benefits, pensions and support activities. Government budgets are overwhelmed by personnel costs for wages, benefits and pensions that now consume revenues needed for infrastructure (roads, bridges, tunnels, school repairs and constructions) and other necessities such as public transportation, health care, social services and other goods and services that can and should be purchased through competitive bids from private concerns. Public employment is at record levels indicating a massive anomaly to the productivity and efficiencies that are realized in the private sector. State and local employment is a record high 19.7 million. Federal government employment is a record high 2.7 million. Over 22 million (a) people are on government payrolls!!!! The payroll costs for all these employees, coupled with the needed buildings, offices, desks, automobiles, trucks, uniforms, weapons, training sessions, conferences, computers, managerial staff, vacations, health insurance and massive pension program benefits is overwhelming limited tax revenue sources at the very time the private sector is cutting back to realize increased productivity and efficiency. This situation cannot be cured through curtailment. It requires drastic cutbacks, drastic permanent layoffs and drastic changes to benefit and pension program terms and funding. It must start in November 2010.
(a) Interested readers can go to http://www.census.gov/govs/apes/index.html and examine the details of these numbers including state specific statistics.
Friday, October 23, 2009
Fiscal Policy
Americans have witnessed exaggerated unintended consequences of fiscal policy and monetary policy gone berserk. Terrified of an economic correction in 2001 and a stock market correction, the economic masterminds of the universe deemed that a combination of increased government spending and lower taxes (fiscal policy) and ridiculously low short interest rates (monetary policy) would be appropriate government policy to avoid some small pain brought about these needed economic adjustments.
The result of these three acts – massive federal spending (joined freely and aggressively by most of the 50 states), lower marginal tax rates and short term borrowing rates coupled with a discipline-free credit evaluation process have now produced record levels of bad real and contingent assets – loans, bonds and future payment commitments for entitlement programs and public sector employees benefits and pensions, at levels that may not even be quantifiable. This process and its results have birthed their own bogeymen. The blame game identifies the bad guys as Wall Street greed merchants, sleepy regulatory agencies and, depending upon the issue and the proclaimer, insurance companies and other capitalist entities. The real bogeymen are 2.7 million federal employees; view them for yourselves at: http://www2.census.gov/govs/apes/07fedfun.pdf and over 19 million state and local government employees – view them at: http://www2.census.gov/govs/apes/08stlus.txt . These numbers are truly numbing!
American fiscal policy is a complete failure. Everyone seems to know but the DC fools. Moderate economic corrections are deemed to be politically unacceptable. This is absolute nonsense. What should be unacceptable is the dominance of special interests which prevent weak and corrupt politicians from cutting back on government spending when tax revenues encounter shrinkage due to economic slowdown or recession. These politicians are akin to a person not cutting back on caloric intake after an undisciplined holiday period with excessive eating and drinking. Look around you. Have you ever seen so many obese people? This mentality of no personal or communal discipline is now the norm in the US.
Special interests are so imbedded in America’s political power process that politicians think that saving a government job is a benefit to overall economic growth. It is exactly the opposite. The more government jobs that are funded the fewer wealth creating jobs will be formed. It is as simple as the logic of the fat person. Tomorrow things will be better. Nonsense. Tomorrow starts today and if you don’t cut back today you will never experience a better tomorrow. Sacrifice and frugality are fundamentals everywhere but in the fiscal and monetary policy of Washington DC and state capitols. And, an increasing plurality of American voters is buying into this fiscal policy nonsense!
The result of these three acts – massive federal spending (joined freely and aggressively by most of the 50 states), lower marginal tax rates and short term borrowing rates coupled with a discipline-free credit evaluation process have now produced record levels of bad real and contingent assets – loans, bonds and future payment commitments for entitlement programs and public sector employees benefits and pensions, at levels that may not even be quantifiable. This process and its results have birthed their own bogeymen. The blame game identifies the bad guys as Wall Street greed merchants, sleepy regulatory agencies and, depending upon the issue and the proclaimer, insurance companies and other capitalist entities. The real bogeymen are 2.7 million federal employees; view them for yourselves at: http://www2.census.gov/govs/apes/07fedfun.pdf and over 19 million state and local government employees – view them at: http://www2.census.gov/govs/apes/08stlus.txt . These numbers are truly numbing!
American fiscal policy is a complete failure. Everyone seems to know but the DC fools. Moderate economic corrections are deemed to be politically unacceptable. This is absolute nonsense. What should be unacceptable is the dominance of special interests which prevent weak and corrupt politicians from cutting back on government spending when tax revenues encounter shrinkage due to economic slowdown or recession. These politicians are akin to a person not cutting back on caloric intake after an undisciplined holiday period with excessive eating and drinking. Look around you. Have you ever seen so many obese people? This mentality of no personal or communal discipline is now the norm in the US.
Special interests are so imbedded in America’s political power process that politicians think that saving a government job is a benefit to overall economic growth. It is exactly the opposite. The more government jobs that are funded the fewer wealth creating jobs will be formed. It is as simple as the logic of the fat person. Tomorrow things will be better. Nonsense. Tomorrow starts today and if you don’t cut back today you will never experience a better tomorrow. Sacrifice and frugality are fundamentals everywhere but in the fiscal and monetary policy of Washington DC and state capitols. And, an increasing plurality of American voters is buying into this fiscal policy nonsense!
Wednesday, October 21, 2009
We Try Harder
Who is the biggest spending special interest group in the US of A?
US Chamber of Commerce. Here’s how they describe themselves at http://www.uschamber.com/
“The U.S. Chamber of Commerce is the world's largest business federation representing 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations. More than 96% of U.S. Chamber members are small businesses with 100 employees or fewer.”
So, who’s number 2? American Medical Association. Check them out at: http://www.ama-assn.org/
Here’s how they describe their mission: “Mission: To promote the art and science of medicine and the betterment of public health.”
TheFundamentals is a big fan of doctors, particularly doctors who are bettering public health and the art and science of medicine. But, what about doctors who are bettering their own financial health? Where in the mission statement do they address “bettering our doctors financial health?” Let’s see if the AMA needs to revise their mission statement.
The AMA recently sent their boss, J. James Rohack, M.D. to Washington DC to support Senate Bill S. 1776 “to repeal the flawed Medicare payment formula.” So, Dr. Jim aligned himself and his big organization with one of the real successful powerhouses of the US Senate. He chose a senator who has been chosen by the people of one of the states with the highest unemployment in the US; one of the most troubled large cities in the US; a state that has become the poster child for begging for federal handouts; a state that avoids bankruptcy or receivership as the consequence of the 24/7 operations of the printing presses at the US Bureau of Engraving and its codependents at the US Treasury and Federal Reserve.
Why, on earth, one might ask would the head of the American Medical Association, a fairly prestigious outfit, align with a person with these credentials? What could possibly motivate such a partnership?
You get three guesses.
One. Promote the art of science and medicine? NO.
Two. Promote the betterment of public health? NO.
Three. Promote our members financial health? YES.
The estimated cost of S. 1776, that great piece of legislation being promoted by the senator from the state of Michigan and Dr. Jim is a modest ----- $247 BILLION over the next 10 years!! That should keep the fuel tanks on the yachts of a few hundred thousand physicians pretty much filled up. Or, if you prefer to stay on land, it should pay the dues at the prestigious country clubs, huh?
Also, in case you are interested. The AMA was joined in supporting this recently renamed piece of legislation - Doctors Financial Health Security Act of 2009, by that ever so present special interest group know as AARP. This outfit claims a modest 40,000,000 members. One thing you can always count on is the early bird specialists lining up for something else to put on their children and grandkids credit card. You just gotta love this combination: Senator from a completely busted state; head of an organization of pretty rich individuals and 40 million insatiably demanding wannabee antediluvians all groveling for another big payday for their members. You scratch my back; I’ll scratch yours.
The AMA. We try harder.
US Chamber of Commerce. Here’s how they describe themselves at http://www.uschamber.com/
“The U.S. Chamber of Commerce is the world's largest business federation representing 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations. More than 96% of U.S. Chamber members are small businesses with 100 employees or fewer.”
So, who’s number 2? American Medical Association. Check them out at: http://www.ama-assn.org/
Here’s how they describe their mission: “Mission: To promote the art and science of medicine and the betterment of public health.”
TheFundamentals is a big fan of doctors, particularly doctors who are bettering public health and the art and science of medicine. But, what about doctors who are bettering their own financial health? Where in the mission statement do they address “bettering our doctors financial health?” Let’s see if the AMA needs to revise their mission statement.
The AMA recently sent their boss, J. James Rohack, M.D. to Washington DC to support Senate Bill S. 1776 “to repeal the flawed Medicare payment formula.” So, Dr. Jim aligned himself and his big organization with one of the real successful powerhouses of the US Senate. He chose a senator who has been chosen by the people of one of the states with the highest unemployment in the US; one of the most troubled large cities in the US; a state that has become the poster child for begging for federal handouts; a state that avoids bankruptcy or receivership as the consequence of the 24/7 operations of the printing presses at the US Bureau of Engraving and its codependents at the US Treasury and Federal Reserve.
Why, on earth, one might ask would the head of the American Medical Association, a fairly prestigious outfit, align with a person with these credentials? What could possibly motivate such a partnership?
You get three guesses.
One. Promote the art of science and medicine? NO.
Two. Promote the betterment of public health? NO.
Three. Promote our members financial health? YES.
The estimated cost of S. 1776, that great piece of legislation being promoted by the senator from the state of Michigan and Dr. Jim is a modest ----- $247 BILLION over the next 10 years!! That should keep the fuel tanks on the yachts of a few hundred thousand physicians pretty much filled up. Or, if you prefer to stay on land, it should pay the dues at the prestigious country clubs, huh?
Also, in case you are interested. The AMA was joined in supporting this recently renamed piece of legislation - Doctors Financial Health Security Act of 2009, by that ever so present special interest group know as AARP. This outfit claims a modest 40,000,000 members. One thing you can always count on is the early bird specialists lining up for something else to put on their children and grandkids credit card. You just gotta love this combination: Senator from a completely busted state; head of an organization of pretty rich individuals and 40 million insatiably demanding wannabee antediluvians all groveling for another big payday for their members. You scratch my back; I’ll scratch yours.
The AMA. We try harder.
Monday, October 19, 2009
"kool aid"
“And good teachers aren't just critical for the success of our students. They are the key to the success of our economy.”
“And we need to treat teachers like the professionals they are by providing good salaries and high-quality professional development opportunities.”
“And we need government to support significant efforts to recruit and retain teachers and to reward high-performing teachers.”
Compelling arguments, huh?
Who do you think is the source* of these quotes? Mission statement of the American Federation of Teachers (1,400,000 members)? The National Education Association (3,200,000 members)?
Is there validity to these quotations? Teachers must be critical to the success of students? Teachers should be treated as professionals? And, government needs to support efforts to recruit and train teachers? Well, the first two are pretty basic but the third makes it seem as if the others are just designed to reach the conclusion and the conclusion is “we need government.”
But let’s go back to the first quote. “They are the key to the success of our economy.” True or False? Answer here: _____
If you say True you will buy into the rest of the posits and accept the conclusion (kool-aid) and the rest falls into place.
If you say False the whole argument collapses.
So, true or false?
Unfortunately the answer is false. The argument is quite convincing because it sounds good (kool aid) and if you accept it you will miss the key element that is missing from the conclusion. Third quote says, “…reward high-performing teachers.” Nothing about penalty for “low-performing teachers.” Nothing about low-performing teachers at all. Why not?
The entire argument collapses because it is a political statement, not an argument basic on fact and logic. It collapses because it is designed to communicate a message and sell an emotional position. TheFundamentals calls this “drinking the kool aid." Without rewards and penalties the economy will not be competitive. Without a constant focus on competition and competitiveness there will be no economic success.
Where do people develop competition and competitiveness? Lots of places. In the home, on the sports field, in the ‘hood, in good schools and in the military. Yes. In government? Absolutely not.
Competitiveness is not only a fundamental; it’s a fundamental most are born with. It is the key to economic success. GM and Chrysler are not in the dumpster just due to their high legacy costs and ridiculous union rules. They lost their competitiveness. Government bailed them out because they were not competitive. Government supports high legacy costs and ridiculous union rules and benefits which are non competitive (see: TheFundamentals, October 15, 2009). So, does the source of the above quotes.
People who sell kool aid do so for their own benefit. People drink kool aid because their emotions dominate their fundamentals. Stick with TheFundamentals. Don't drink the "kool aid."
*Michelle Obama: US News and World Report, October 15, 2009
“And we need to treat teachers like the professionals they are by providing good salaries and high-quality professional development opportunities.”
“And we need government to support significant efforts to recruit and retain teachers and to reward high-performing teachers.”
Compelling arguments, huh?
Who do you think is the source* of these quotes? Mission statement of the American Federation of Teachers (1,400,000 members)? The National Education Association (3,200,000 members)?
Is there validity to these quotations? Teachers must be critical to the success of students? Teachers should be treated as professionals? And, government needs to support efforts to recruit and train teachers? Well, the first two are pretty basic but the third makes it seem as if the others are just designed to reach the conclusion and the conclusion is “we need government.”
But let’s go back to the first quote. “They are the key to the success of our economy.” True or False? Answer here: _____
If you say True you will buy into the rest of the posits and accept the conclusion (kool-aid) and the rest falls into place.
If you say False the whole argument collapses.
So, true or false?
Unfortunately the answer is false. The argument is quite convincing because it sounds good (kool aid) and if you accept it you will miss the key element that is missing from the conclusion. Third quote says, “…reward high-performing teachers.” Nothing about penalty for “low-performing teachers.” Nothing about low-performing teachers at all. Why not?
The entire argument collapses because it is a political statement, not an argument basic on fact and logic. It collapses because it is designed to communicate a message and sell an emotional position. TheFundamentals calls this “drinking the kool aid." Without rewards and penalties the economy will not be competitive. Without a constant focus on competition and competitiveness there will be no economic success.
Where do people develop competition and competitiveness? Lots of places. In the home, on the sports field, in the ‘hood, in good schools and in the military. Yes. In government? Absolutely not.
Competitiveness is not only a fundamental; it’s a fundamental most are born with. It is the key to economic success. GM and Chrysler are not in the dumpster just due to their high legacy costs and ridiculous union rules. They lost their competitiveness. Government bailed them out because they were not competitive. Government supports high legacy costs and ridiculous union rules and benefits which are non competitive (see: TheFundamentals, October 15, 2009). So, does the source of the above quotes.
People who sell kool aid do so for their own benefit. People drink kool aid because their emotions dominate their fundamentals. Stick with TheFundamentals. Don't drink the "kool aid."
*Michelle Obama: US News and World Report, October 15, 2009
Thursday, October 15, 2009
Government to Government: STOP
There is a village about 30 miles northwest of Chicago that is communicating a warning and call to action about the problem with public employee pensions in Illinois. This village in this state is one of thousands of local communities across the country (view the links in the left margin entitled “Feeding at the Public Trough”) facing unheard of costs for pensions that have been manipulated through state legislatures at the behest of special interest unions with the complicity of weak and corrupt politicians. This is a very important message and we encourage you to read it in its entirety. Here is the text of that call to action:
Q: What pensions are available to public employees?
As required by state law, municipal employees (police,
fire and non-public safety personnel) are covered by three
separate pension programs.
Police and firefighters are covered by local pension funds.
Decisions for these pension funds are made by a board
consisting of two active employees, one annuitant and
only two representatives of the municipality. Police and
firefighters receive a full pension (75% of their final pay)
after age 50 with 30 years of service and may receive a
50% pension at age 50 with 20 years of service. Police and
firefighters also are entitled to numerous other benefits.
All other eligible municipal employees are covered by
the Illinois Municipal Retirement Fund (IMRF), which is
a statewide program that consolidates multiple municipal
employers into a single fund. It is governed by a board
consisting of three current employees, one annuitant and
four representatives of employer local governments. IMRF
employees receive a full (75%) pension at age 60 after 40
years of service and may receive a 50% pension at age 55
with 31 years of service.
Q: Who determines the benefits and contributions for
pension programs?
By law, our Village is mandated to fund the pension benefits
of police, firefighters and other municipal employees. The
General Assembly determines the benefits and employee
contributions for pension programs, not your local elected
officials.
The Crisis:
The unprecedented economic downturn has impacted our
residents, businesses and municipal revenues. Despite the
fact that the Village of Barrington has made its actuarially
required pension contributions (and more) over the years,
losses in retirement fund values and escalating costs due
to pension sweeteners authorized by the Illinois General
Assembly have taken a toll on the funding of public
employee pensions. This funding comes from three
sources – employee contributions, employer contributions,
and investment returns. Since employee contributions are
capped by the General Assembly, the fiscal burden falls
upon the Village contributions (local taxpayers) to keep
these funds financially solvent. By law, Barrington is
mandated to fund the pension benefits of police, firefighters
and other municipal employees.
Unless the Illinois General Assembly takes action on October
14-16 and 28-30, a massive spike in police and fire pension
costs will have a significant impact on our Village’s budget in
2010. Funding these increased pension costs will contribute
to major cuts in other areas of our budget affecting Village
services and possibly more staff.
Recognizing the financial impact on taxpayers, the Illinois
Municipal Retirement Fund (IMRF) board took steps
to mitigate its investment loss and offered an option to
municipalities to cap their fund contribution for municipal
(except police and fire) employees to a 10% increase per
year. However, a similar cap on contributions to police
and firefighter funds will require legislative action by the
Illinois General Assembly. While a cap is only a stop gap
measure, it would help ease the immediate budget crisis for
municipalities.
Our community, through the Northwest Municipal
Conference (NWMC), sought such a legislative remedy this
year. Working with Senators Susan Garrett and Pam Althoff,
NWMC succeeded in getting Senate Bill 2011 approved by
the Illinois Senate. Opposition from the state police and
firefighter unions stalled Senate Bill 2011’s advancement in
the Illinois House.
Members of the General Assembly have one more opportunity
to provide relief from this substantial spike in public safety
pension costs during their fall veto session on October 14-16
and 28-30. Waiting until next year for legislative action will
be too late.
While the state Representatives and Senators representing
Barrington have been very helpful to our Village on this
issue, it is important for more of their colleagues to do the
same. To minimize the impact on current Village services
caused by escalating pension costs, please contact your State
Senators and Representatives, thank them for their past
support, and urge them to continue to support Senate Bill
2011 and ask them to encourage their colleagues to support
it, as well.
For a list of the Village’s State Senators and Representatives
and for additional information, please visit the Village’s
website at http://www.barrington-il.gov/.
Q: What pensions are available to public employees?
As required by state law, municipal employees (police,
fire and non-public safety personnel) are covered by three
separate pension programs.
Police and firefighters are covered by local pension funds.
Decisions for these pension funds are made by a board
consisting of two active employees, one annuitant and
only two representatives of the municipality. Police and
firefighters receive a full pension (75% of their final pay)
after age 50 with 30 years of service and may receive a
50% pension at age 50 with 20 years of service. Police and
firefighters also are entitled to numerous other benefits.
All other eligible municipal employees are covered by
the Illinois Municipal Retirement Fund (IMRF), which is
a statewide program that consolidates multiple municipal
employers into a single fund. It is governed by a board
consisting of three current employees, one annuitant and
four representatives of employer local governments. IMRF
employees receive a full (75%) pension at age 60 after 40
years of service and may receive a 50% pension at age 55
with 31 years of service.
Q: Who determines the benefits and contributions for
pension programs?
By law, our Village is mandated to fund the pension benefits
of police, firefighters and other municipal employees. The
General Assembly determines the benefits and employee
contributions for pension programs, not your local elected
officials.
The Crisis:
The unprecedented economic downturn has impacted our
residents, businesses and municipal revenues. Despite the
fact that the Village of Barrington has made its actuarially
required pension contributions (and more) over the years,
losses in retirement fund values and escalating costs due
to pension sweeteners authorized by the Illinois General
Assembly have taken a toll on the funding of public
employee pensions. This funding comes from three
sources – employee contributions, employer contributions,
and investment returns. Since employee contributions are
capped by the General Assembly, the fiscal burden falls
upon the Village contributions (local taxpayers) to keep
these funds financially solvent. By law, Barrington is
mandated to fund the pension benefits of police, firefighters
and other municipal employees.
Unless the Illinois General Assembly takes action on October
14-16 and 28-30, a massive spike in police and fire pension
costs will have a significant impact on our Village’s budget in
2010. Funding these increased pension costs will contribute
to major cuts in other areas of our budget affecting Village
services and possibly more staff.
Recognizing the financial impact on taxpayers, the Illinois
Municipal Retirement Fund (IMRF) board took steps
to mitigate its investment loss and offered an option to
municipalities to cap their fund contribution for municipal
(except police and fire) employees to a 10% increase per
year. However, a similar cap on contributions to police
and firefighter funds will require legislative action by the
Illinois General Assembly. While a cap is only a stop gap
measure, it would help ease the immediate budget crisis for
municipalities.
Our community, through the Northwest Municipal
Conference (NWMC), sought such a legislative remedy this
year. Working with Senators Susan Garrett and Pam Althoff,
NWMC succeeded in getting Senate Bill 2011 approved by
the Illinois Senate. Opposition from the state police and
firefighter unions stalled Senate Bill 2011’s advancement in
the Illinois House.
Members of the General Assembly have one more opportunity
to provide relief from this substantial spike in public safety
pension costs during their fall veto session on October 14-16
and 28-30. Waiting until next year for legislative action will
be too late.
While the state Representatives and Senators representing
Barrington have been very helpful to our Village on this
issue, it is important for more of their colleagues to do the
same. To minimize the impact on current Village services
caused by escalating pension costs, please contact your State
Senators and Representatives, thank them for their past
support, and urge them to continue to support Senate Bill
2011 and ask them to encourage their colleagues to support
it, as well.
For a list of the Village’s State Senators and Representatives
and for additional information, please visit the Village’s
website at http://www.barrington-il.gov/.
Tuesday, October 13, 2009
Fresh Air
It would be interesting if it were possible to have an objective historian comment on today’s American scene but with the perspective of the reality of the next 20 years. We all must wonder how the gap between the power forces can be so great. How can the party in power (PIP) be preaching a gospel of big government spending, massive deficits and debt accumulation and still claim the target of creating jobs? While the party out of power (POOP) preaches tax reductions and spending limitations to create jobs. It is like two coaches, one telling the players that defense wins ball games and the other emphasizing offense. Both POOP and PIP can lay claim to massive spending and massive debt buildup. They are good at that. They always seem to come together frequently enough to make sure there are enough votes to pass any and all spending bills. So, what is a person to do? One says tomato and one says tomahto.
Let’s leave the politician scene and look for input elsewhere. This, by the way, is not a path frequented by the so-called mainstream media. For years, TheFundamentals has wondered why TV executives and producers keep bringing the same faces and voices to the same talking shows with the same limited vision, parochial viewpoints. Why do they keep giving the diminishing viewing and listening audience the same faces, the same opinions, the same fact less viewpoints? If their audience were growing one could explain this repeat performance. It is similar to the correct criticism leveled to the old boys club that runs many big corporations although that scene is and has been changing. The media folk just don’t get it. But then something happened on this last Sunday when one of the shows actually had a real life businessman and he acted like a real life businessman. All of us who made a living in a competitive environment where you had to make sure there was enough money in the bank so that the employees could cash their paychecks and you had to take phone calls from clients who were not as impressed with the quality of your product and services as you were and all of us who made calls on prospects and sat in a waiting room for 52 minutes waiting to get 10 minutes of some middle managers time to make a pitch had to smile when Steve Wynn uttered the following words, “Government has never increased the standard of living of one single human being in civilization's history."
Praise the Lord. There still is at least one common sense guy left in the purgatory we call American politics.
Let’s just hope that this one voice is heard somewhere before it is too late. Wynn’s sixteen words should be tattooed on the buttocks of every PIP and POOP politician.
Let’s just hope that the voters on November 2, 2010 (not that far away folks) come to their senses in adequate numbers to put an end to this trip through the rabbit hole. As TheFundamentals has pointed out, there are an awful lot of voters who sign on to the “something for nothing” philosophy. Wynn has it right. Government has not and cannot create wealth. It cannot create jobs. It can only foster a growth environment or destroy a growth environment. Simple reality. Guess which path POOP is on?
The US of A needs a few Steve Wynn’s on the November 2010 ballots. Pray and work for this event.
Let’s leave the politician scene and look for input elsewhere. This, by the way, is not a path frequented by the so-called mainstream media. For years, TheFundamentals has wondered why TV executives and producers keep bringing the same faces and voices to the same talking shows with the same limited vision, parochial viewpoints. Why do they keep giving the diminishing viewing and listening audience the same faces, the same opinions, the same fact less viewpoints? If their audience were growing one could explain this repeat performance. It is similar to the correct criticism leveled to the old boys club that runs many big corporations although that scene is and has been changing. The media folk just don’t get it. But then something happened on this last Sunday when one of the shows actually had a real life businessman and he acted like a real life businessman. All of us who made a living in a competitive environment where you had to make sure there was enough money in the bank so that the employees could cash their paychecks and you had to take phone calls from clients who were not as impressed with the quality of your product and services as you were and all of us who made calls on prospects and sat in a waiting room for 52 minutes waiting to get 10 minutes of some middle managers time to make a pitch had to smile when Steve Wynn uttered the following words, “Government has never increased the standard of living of one single human being in civilization's history."
Praise the Lord. There still is at least one common sense guy left in the purgatory we call American politics.
Let’s just hope that this one voice is heard somewhere before it is too late. Wynn’s sixteen words should be tattooed on the buttocks of every PIP and POOP politician.
Let’s just hope that the voters on November 2, 2010 (not that far away folks) come to their senses in adequate numbers to put an end to this trip through the rabbit hole. As TheFundamentals has pointed out, there are an awful lot of voters who sign on to the “something for nothing” philosophy. Wynn has it right. Government has not and cannot create wealth. It cannot create jobs. It can only foster a growth environment or destroy a growth environment. Simple reality. Guess which path POOP is on?
The US of A needs a few Steve Wynn’s on the November 2010 ballots. Pray and work for this event.
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