August 24, 2010
The following letter to the editor of the Chicago Tribune from Civic Federation President Laurence Msall was published on August 24, 2010.
As a non-partisan, independent government research organization, the Civic Federation applauds R. Eden Martin, the Commercial Club and the Chicago Tribune for their efforts to bring more attention to the looming catastrophe that is our state pension system ("Tribune, 'tool of terror,'" Editorial, Aug. 19, and "Pensions: All our problem," Commentary, Aug. 19, by Martin, president of the Civic Committee of the Commercial Club of Chicago). The Civic Federation strongly agrees with Mr. Martin that drastic reforms are needed to save thousands of public workers' pensions and the state's finances. Instead of attacking the messengers, the opponents of pension-benefit reform should publicly announce the details of the state tax increases they require to avoid future pension benefit reductions and pay down the more than $70 billion in unfunded benefits already earned.
It is also important for taxpayers to understand that the problem is far worse than just pensions in the state. Pensions in Chicago and other local governments across the state are also in crisis. The funding deficit for the 10 major pension funds in the Chicago area alone is more than $15 billion. No small changes will be adequate to the task of restoring these funds' fiscal health. Major benefit changes and contribution increases are required immediately to stabilize the situation. The risk of pension funds in Illinois running out of money to pay benefits is now very real. A recent report by Mayor Richard Daley's Commission to Strengthen Chicago's Pensions found that if nothing is done, the Chicago Fire and Police pension funds are likely to run out of money within 10 years.
Clearly a comprehensive approach will be required to reform pensions in Illinois. Overheated rhetoric and personal attacks are doing nothing to promote the atmosphere of compromise and responsible leadership that will be needed to alleviate Illinois' pension crisis.
— Laurence Msall, president, The Civic Federation, Chicago