Chicago Pension Collapse, Right On Schedule

From our dear leader's home town - 

The woes of the city and the state of Illinois – which has its own, worst-in-the-nation, $100bn unfunded pension liability – have been driven primarily by the government’s failure to pay its share to keep its pension promises.

But this month, after years of inaction, Illinois passed a bill to tackle its unfunded pension liability. The state hopes the new law will save $160bn over the next 30 years – savings that will come from cuts in retirement benefits for state workers and forcing the state to make its pension contributions. The law has won plaudits as a first step towards fiscal reform. But it comes only after repeated downgrades that have left Illinois with the lowest credit rating of any US state.

 This is what always happens with supply/demand -

1. A group demands more than can be adequately funded.
2. Said group provides either research that 'proves NEW ECONOMIC REALITY' or infiltrates the representatives in order to take over.
3. The group promises pie in the sky fantasy scenarios in which 'everyone can be rich!'
4. Conservative groups which, rightly, observe this scenario is completely unsustainable are demonized by the group and marginalized.
5. The scenario is completely realized including the conservative's predicted dire consequences.
6. The group either mutates into a 'totally new group' with another 'NEW ECONOMIC REALITY' or the group seeks to impose its will via force. (War)

Indeed, these actions are so reliable, that one can predict future events off of these:

 Now, I'm going to go out on a limb here and guess that these projections factor in an economic recovery and do not include the current housing crisis let alone the Depression. Following the government time rule of 1/3 (to factor in the propensity of government to massively step up their idiocy) that would mean Illinois will be bankrupt in 2015 without a housing crisis.

Now, where do we currently stand?

“The pension crisis is not truly solved until relief is brought to Chicago and all of the other local governments across our state that are standing on the brink of a fiscal cliff because of our pension liabilities,” Mr Emanuel said after the state deal.

The Chicago teachers’ pension fund is roughly 54 per cent funded, far below the 80 per cent threshold considered healthy. But it is better off than the city’s municipal workers, police, labour and firefighters’ pension funds, which Fitch, the credit rating agency, estimates are collectively 33 per cent funded.

Well, well, well... lookie here... Half funded eh? And of that half funding, how much of that is "toxic derivatives"? (Translation - Non-existent assets)

This vindicates many, myself included, who for decades have been shouting that it is impossible to do economic acrobatics and screaming for the incarceration of the fraudulent hucksters who set these messes up. Further, it completely discredits those who are unable to perform basic math in order to understand that this situation is only, going, to, get.....worse....