Tuesday, March 5, 2013

Dissembling: Seven Simple Sentences


Dissembling (Seven Simple Sentences)

Dissemble – verb intransitive – to conceal one’s true feelings, beliefs or motives.

A recent electronic message from Representative Michael Tryon displays the kind of half-truths and factual recklessness that might even make the editorial staff of the Chicago Tribune blush.  On the other hand these kinds of false assertions have been so proselytized by opportunistic politicians and media, even Carol Marin on WTTW keeps a straight face while Representative Nekritz serves them up as reasons for HB 3411.

Here is part of Rep. Tryon’s plaintive email message.

“How Did We Get Here?
The pension liability is the single issue that places the most pressure on the budget. Simply put, the pension payment takes up so much of the available funds that there is not enough money left to pay for all the items in the rest of the budget. For many years, legislators made only partial pension system payments or skipped them altogether. During my eight years in the House I have never voted for anything less than a full pension payment. However, those poor decisions by the majority of lawmakers, combined with benefit perks that were not actuarially calculated to ensure future sustainability, and increasing life expectancies for pension recipients, has created a $97 billion pension liability that grows by a staggering $17 million every day. The second primary cause for the state’s financial problems relate to the shell games and fund “sweeps,” where money earmarked for one program has been moved around and used for other purposes. Over time, the result was expenditures that outpaced available resources (in some years by billions of dollars), a growing backlog of bills, and an accumulation of bonded debt.”

1. The pension liability is the single issue that places the most pressure on the budget.  As with many of our legislators, the Representative likes to blend the real problem of the unfunded liability (the money that was embezzled over the years from the pensions funds and now owed to the pensions) with the state’s normal costs for pensions.  In actuality, the amount to be paid to pensioners this year in TRS is actually less than last year, but he won’t and wouldn’t say that.  It would hurt his argument – and it’s the truth.

2. Simply put, the pension payment takes up so much of the available funds that there is not enough money left to pay for all the items in the rest of the budget.  Once again, Representative Tryon is performing the same kind of verbal legerdemain that so many in Springfield have become so masterful at doing.  It is true that the cost of the pension’s unfunded liability (remember all that money they owe that they embezzled to begin with?); but that is because the General Assembly has never had the fiscal intelligence and political foresight to dispense with a completely misguided re-payment schedule they themselves adopted in 1995 to back load their payments so that they became fiscally hamstrung by 2013. 

3. For many years, legislators made only partial pension system payments or skipped them altogether.  The Representative is almost correct, but “for many years” should actually read decades (maybe half a century?).  Indeed, the state has been taken to court regarding its refusal to pay, but alas, the courts have not been able to agree that an Article assuring pension as contractual promises necessarily means a need to pay.  And, thusly, legislators like Representative Tryon and others blithely went about the business of using the pension funds to pay for everything else – all the other services they now tell everyone are suffering because of pensions.  Once again, not really true.  But really short-sighted.

4. During my eight years in the House I have never voted for anything less than a full pension payment.  That’s nice to hear, but in actuality the State of Illinois chooses to use the least accurate actuarial methodology in determining the normal costs of pensions (not the unfunded debt), so the payment is based on present not future extrapolations.  They have a choice, but Representative Tryon and the others in the General Assembly choose the least expensive and least accurate – always have.  Are you surprised?

5. However, those poor decisions by the majority of lawmakers, combined with benefit perks that were not actuarially calculated to ensure future sustainability, and increasing life expectancies for pension recipients, has created a $97 billion pension liability that grows by a staggering $17 million every day.  This is the emotional tsunami sentence that Governor Quinn likes to use as much as possible.  I am sure we’ll hear it many times during the budget speech tomorrow.  In actuality, those “perks” like the COLA were part of a payment into contributions by TRS members in the 90’s, and the need to cover such an expenditure (according to Rep. Mike Fortner in an interview last year ) would require only a 1% additional contribution.  The We Are One coalition has already offered 2%, but in this state of hysteria and hyperbole to get it done quickly, Representative Tryon’s “the sky is falling” works so much better.  As for living too long?  We hear this argument from Republicans on the federal level too.  But this makes up for the egregious theft of billions of dollars to begin with.

6. The second primary cause for the state’s financial problems relate to the shell games and fund “sweeps,” where money earmarked for one program has been moved around and used for other purposes.  This is a classic piece of passivity in writing, where the actual subject disappears, so the guilty party can be veiled to assure the identification of another party (like public sector workers) to make it right.  What the sentence is actually stating is that “We, the government (your duly elected officials) not only stole the money from you for our own pet projects, but we also diverted pension obligation bond money and any other funds we could to our own uses.  Like Thompson used to crow to the public citizens, “we provided services without your having to pay anything more.”  Do you like me now?  Not really.

7. Over time, the result was expenditures that outpaced available resources (in some years by billions of dollars), a growing backlog of bills, and an accumulation of bonded debt.  Wow.  Talk about passivity.  Quite simply, this sentence states, “We took more money and bought more services without adequate revenue.  Because we thought we could pilfer eternally from these pension funds we not only spent extravagantly of their money, but we carried that fiscally capricious attitude over to other state programs, service costs and original pension obligations.  

That’s How We Got Here!

3 comments:

  1. Brilliant analysis. Reminds me of the movie Annie Hall. We hear the dialogue between Woody and Diane, but we read on the screen what they are really thinking.

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  2. someone needs to apply the KISS Principle to this whole program, or suffer what the politicians can wiggle out of.

    If all is needed is a revised payment schedule then why does everyone get involved in laying blame, dissecting what they really mean etc., PUT OUT THE PROPER, SIMPLE MESSAGE, OR RISK GETTING STUCK WITH WHAT OTHERS DECIDE!

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  3. Thank you for your frank, to the point insight into the problem.
    A teacher.

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