Daily Herald - Suburban Chicago's source for news This copy is for personal, non-commercial use. To order presentation-ready copies for distribution you can: 1) Use the "Reprint" button found on the top and bottom of every article, 2) Visit reprints.theygsgroup.com/dailyherald.asp for samples and additional information or 3) Order a reprint of this article now.
Article posted: 12/29/2012 5:00 AM

How we got to this pension crisis

The propaganda within "This is My Illinois" campaign is filled with half-truths and incomplete information. Here is an anatomy of the pension crisis.

A history of neglect: Only the state has underfunded the pension systems; by law teachers always pay their 9.4 percent. About 80 percent of TRS's funding level is financed through educator contributions and investment earnings. The state not only underfunded the pension systems, they borrowed money from them to meet other financial obligations. Any changes to any state pension system must include a guarantee the state will make its required payments, on time.

Missteps, malfeasance and monkey business: The Illinois Senate and House of Representatives enacted laws enabling both politicians and some public employees to "spike" their pensions. Teachers do not have the ability to spike their pensions.

Two economic recessions: The Teacher Retirement System in 2010 paid out $3.9 billion in benefits, but collected $6.8 billion in revenue. The long-term rate of return on TRS investments, since 1982, is around 9.8 percent. Short-term investment earnings are irrelevant. Revenue fell in Illinois because of poor leadership in Springfield. By stating that Illinois has $83 billion in pension liability is like saying a 30-year mortgage is all due now.

Changing demographics: Are teachers the only state employees that can retire early? Teachers are not eligible for Social Security. The average teacher pension is about $43,000.

A few questions: If teachers are punished for the errors of the government, what quality of educators do you think Illinois will attract to teach our youth? Do you think teachers deserve, for their many years of public service, an opportunity for a dignified retirement?

Robert C. Lange

Stevenson Elementary School teacher

Des Plaines

Copyright © 2014 Paddock Publications, Inc. All rights reserved.