#chicagopolice

More public pension roadkill ahead

CM has been writing about the public pensions crisis in the US for years. This chart only serves to highlight that the problem doesn’t seem to be getting any better. It seems in Illinois, 200 of the 650 public pension funds out there have more beneficiaries than active workers contributing to the fund. By 2021 this is expected to be half of all public pension funds in Illinois.

ZeroHedge noted,

The value of all future pension promises to be paid out to public safety workers totalled just $320 million in 2005. By 2017, that number had jumped to nearly $600 million. That’s a jump of over 80% or more than three times the pace of inflation.

It’s the main reason why taxpayer contributions can’t keep up with pension costs. Pols are doing nothing to control the growth of promises to be paid, sticking taxpayers with ever-increasing costs and ratcheting up the likelihood the pension plans will fail…

… In 1987, municipalities owed a total of $2.6 billion in benefits earned to active and retired public safety workers across the state. Today, that number has jumped to more than $23 billion. That’s a jump of nearly nine times.”

Don’t forget what the Illinois Police Dept did several years back. IN June 2017 CM wrote,

“Sadly the Illinois Police Pension is rapidly approaching the point of being unable to service its pension members and a taxpayer bailout looks unlikely given the State of Illinois’ mulling bankruptcy. Local Government Information Services (LGIS) wroteAt the end of 2020, LGIS estimates that the Policemen’s Annuity and Benefit Fund of Chicago will have less than $150 million in assets to pay $928 million promised to 14,133 retirees the following year…Fund assets will fall from $3.2 billion at the end of 2015 to $1.4 billion at the end of 2018, $751 million at the end of 2019, and $143 million at the end of 2020, according to LGIS…LGIS analyzed 12 years of the fund’s mandated financial filings with the Illinois Department of Insurance (DOI), which regulates public pension funds. It found that– without taxpayer subsidies and the ability to use active employee contributions to pay current retirees, a practice that is illegal in the private sector– the fund would have already run completely dry, in 2015…The Chicago police pension fund held $3.2 billion in assets in 2003. It shelled out $3.8 billion more in benefits to retired police officers than it generated in investment returns between 2003 and 2015…Over that span, the fund paid out $6.9 billion and earned $3.0 billion, paying an additional $134 million in fees to investment managers.”

What have the police been doing? Retiring early and cashing in their pensions to avoid the inevitable.

The problem for Illinois is that a taxpayer-funded bailout is all but impossible. The State of Illinois ranked worst in the Fed study on unfunded liabilities.  The unfunded pension liability is around 24% of state GDP. In 2000 the unfunded gap to state revenue was 30% and in 2013 was 124% in 2013. Chicago City Wire adds that the police fund isn’t the only one in trouble.

“Chicago’s Teachers Union Pension Fund is $10.1 billion in debt. Its two municipal worker funds owe $11.2 billion and its fire department fund owes $3.5 billion…All will require taxpayer bailouts if they are going to pay retirees going into the next decade…Put in perspective, the City of Chicago’s property tax levy was $1.36 billion in 2017…Paying for retirees “as we go,” which will prove the only option once funds run dry, will require almost quadrupling city property tax bills…Last year, it would have required more than $4 billion in revenue– including $1 billion for City of Chicago workers, $1.5 billion for teachers, and $1.5 billion for retired police officers and firefighters.”

This problem is going to get catastrophically worse with the state of bloated asset markets with puny returns. Looking at how it has been handled in the past Detroit, Michigan gives some flavour. It declared bankruptcy around this time three years ago. Its pension and healthcare obligations total north of US$10bn or 4x its annual budget. Accumulated deficits are 7x larger than collections. Dr. Wayne Winegarden of George Mason University wrote that in 2011 half of those occupying the city’s 305,000 properties didn’t pay tax. Almost 80,000 were unoccupied meaning no revenue in the door. Over the three years post the GFC Detroit’s population plunged from 1.8mn to 700,000 putting even more pressure on the shrinking tax base.

In order for states and local municipalities to overcome such gaps, they must reorganise the terms. It could be a simple task of telling retiree John Smith that his $75,000 annuity promised decades ago is now $25,000 as the alternative could be even worse if the terms are not accepted. Think of all the consumption knock-on effects of this. I doubt many Americans will accept that hands down, leading to class actions and even more turmoil.

Did CM mention gold?

Joe Nation’s Pension Tracker is a really good website to look at the actuarial setting of pensions against the marked-to-market unfunded liabilities. Have a stiff drink handy before you open up.

Chicago PD gets its sweet revenge on Smollett

Image result for eddie johnson

Full credit to the Chicago Police Department for releasing the truth on Jussie Smollett before the Cook County judge was able to close the case, citing a FOIA request. Where on earth did the State Attorney’s office think justice was served when they believed Smollett was guilty but dropped all 16 felony charges anyway? How could anyone buy the First Assistant SA saying publicly that Smollett was not exonerated when his slate has been wiped clean? How ironic that Michelle Obama’s former chief-of-staff called the State Attorney Kim Foxx to discuss the concern of the Smollett family. Foxx may have recused herself on conflict of interest grounds, however the end result certainly gives rise to suspicions around calling in favours. How did a botched hoax become deserved of a suppression order?

If you want the truth behind the innocent Smollett, the CPD has provided their hard work in the following two files.

Part 1

Part 2

One of the funniest areas surrounds the Nigerians’ car breaking down after the purchase of the DIY hate crime kit and having to push it out of the parking lot.

Maybe Subway should dedicate some sandwiches to Smollett – Foot long Pinocchio, Jussie’s Jerk Chicken, Carved Turkey and Bleach…#Mugger hat meatball. How well do these sandwiches have to be prepared to escape a staged attack unscathed?

Superintendent smashes secrecy surrounding Smollett settlement

What the Chicago Police Superintendent Eddie Johnson said in this video is 100% correct. He said, “They wanted their day in court with TV cameras so America could know the truth. But no, they chose to hide behind secrecy and broker a deal to circumvent the judicial system.” Mayor Emanuel was also front and centre on Smollett’s unfair dragging of Chicago’s reputation through the mud and the damage his hoax will have against those who have real hate crime claims in future. Smollett has his slate wiped clean.

This is the perfect example of why identity politics is so poisonous. Here was a man potentially willing to make a claim against two innocent white people and jail them for up to 20 years for hate crimes not committed just to bump his salary and smear 63mn Trump supporters at the same time.  He still claims innocence! No morals, no ethics and in Emanuel’s words “is there no decency in this man?

Claims are being made by the media that George Soros donated $408,000 to a super PAC that supported Cook County State Attorney (SA) Kim Foxx’s campaign. While Foxx recused herself on conflict of interest grounds, the First Assistant SA Joseph Magats, who has served in the SA office for three decades, saidThe bottom line is, we stand behind the investigation, we stand behind the decision to charge him…The fact that Smollett feels that we have exonerated him, we have not. I can’t make it any clearer than that. So how does that weigh up to the dismissal of 16 felony charges? Smollett served two days of community service which can be seen here.

To think of the disrespect shown to the excellent investigative work and evidence filed by the police. Do we believe Jussie’s comments on the verdict, “I have been truthful and consistent on every level since day one. I would not be my mother’s son if I was capable of one drop of what I’ve been accused of”? What a fine bit of acting.

So much for dignity and respect of the rule of law to Americans. What a farce.