Pension Wars
Chicago’s Blue Crack-Up
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  • Kavanna

    The last crisis of the Blue Model began in the mid-1960s and reached its climax in 1979-81. Its characteristic symptom was inflation, a sign of monetary and fiscal derangement. The building crisis today is characterized by unreal levels of debt (that can’t be repaid in full) and, at the same time, interest rates artificially suppressed by central banks worldwide. Its origins lie in the triple bubbles of the 1990s, 2000s, and 2010s, all fueled by conscious Fed policy. Debt is a more insidious and subtle derangement than inflation, though, and its poisonous results are taking longer to reach a climactic crisis.

    Unlike in the 1990s, the largest US cities can no longer count on either immigrants or yuppification to save them. Their populations are declining, as their costs keep growing.

  • Anthony

    $757 billion pension gap (all states based on 2010 fiscal analysis – most recent year data available for 50 states) with realistic estimate at $4.5 trillion beckons an acknowledgement of reality. The reality is that this is not going away without serious attention and addressing. But, the societal interconnectedness remains ignored by operating tendency to make distinctions – blue, red, government, private enterprise, etc. That is, the pension scheme (structure, management, and practice) and vested interests don’t countenance raising taxes, passing on social cost, refusing to examine pension promises, etc. as imperiling social compact. While Chicago and Illinois may be outliers, the problem infects us nationally and turns on governance – i.e. politics (as the realm productive of public policy). However given human nature (in municipal America), I would not expect anyone to trace problem to both themselves and officeholders WRM. So, contract clause trumps municipal economics – we shall see.

  • Andrew Allison

    Don’t overlook the enormous number of un- and under-employed who would jump at the chance of those jobs at lower pay and benefits.

  • xbox361

    The real problem is the math, the demon, is racist!
    Or the politicians are fools and knaves who hate to ever deal with reality.

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