We’ve seen decades of Democrat rule bankrupt Detroit – but never before have we seen an entire state file for bankruptcy.
We learned from S&P Global Ratings earlier this week that they’re on track to lower Illinois’ debt rating to “junk bond” territory – a status they’ve been hovering around in recent years.
The only other counties and cities with such a distressed debt rating are Chicago, Atlantic City, and Detroit. You can take a wild guess as to what the political party in charge there is.
While Democrat legislatures have become a rarity in recent years, Illinois is one of the few states still suffering with one – and the results have gone about as you’d expect.
According to Fox News, the state also has $130 billion in unfunded pension obligations that it needs to take into account. In short, Illinois is on the verge of filing for Chapter 9 bankruptcy, which could shut down the entire state. The actual cause of much of the state’s financial problems originated in 2011 when the state, led by Gov. Pat Quinn (D), decided to hike the tax rate to address a looming pension shortfall as well as offset a $12 billion deficit to account for a $35 billion state-wide budget. Since then, the Democrat-led state failed to reform the pension plans. Illinois Policy, an independent organization that promotes freedom-driven public policy in the state, listed the following drivers for the pension crisis:
- 60% of state pensioners retired in their 50’s, many with full pension benefits.
- Over half of state pensioners will receive $1 million or more in pension benefits over the course of their retirements. Nearly 1 in 5 will receive over $2 million in benefits.
- Almost 60% of all current state pensioners can expect to spend 25 or more years collecting benefits, based on approximate actuarial life expectancies. Due to automatic, 3% compounded COLA (cost of living adjustment) benefits, those pensioners can expect to see their annual pension benefits double in size.
- The average career pensioner — retired after Jan. 1, 2013, with 30 years of service or more — receives $66,800 in annual pension benefits and will collect over $2 million in total benefits over the course of retirement.
- The average career pensioner will get back his or her employee contributions after just two years in retirement. In all, pensioners’ direct employee contributions will only equal 6% of what they will receive in benefits over the course of their retirements.
H/T The Daily Wire
Just imagine what Democrats would do if they had eight years in the presidency!
Oh wait….
They did. And our debt ballooned like never before.
Democrats are just fiscally irresponsible. There’s no other way to put it.
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