Illinois State pension debt rises $120 a second

The State Journal-Register reports:

In the time it takes you to read this sentence, Illinois taxpayers will be $200 deeper in debt.

The state’s pension debt will exceed $44 billion this summer, increasing at a rate of about $120 per second, according to Gov. Rod Blagojevich’s administration.

The debt already tops $42 billion — enough to give every one of Illinois’ 12.8 million residents a check for $3,300 or buy 937,000 Cadillacs at $45,000 a pop.

The combination of debt in terms of both money and percentage gives Illinois the infamous distinction of having the nation’s worst pension problem, according to an Associated Press review of records and interviews with experts. And there’s no solution in sight.

The staggering debt load for the five pension plans for state employees is a problem that’s remained largely in the shadows for decades. The $42 billion “unfunded liability” — the difference between the systems’ assets and what they owe employees in benefits — also is creating a real problem for state policy makers.

It’s squeezing out money for other needs, such as education and health care. It means the state has less money for such things as child-care aid and fixing roads and schools or paying some of the $1 billion it owes to Medicaid health-care providers and others.

“Someday, those costs have to be paid,” said Eden Martin, who heads the civic committee of the Commercial Club of Chicago, an economic improvement group. “There is no free lunch anywhere.”

Dating to the 1970s, state lawmakers pushed off the yearly payments they were supposed to make to cover the “normal costs” of pensions, or how much employees earned that year in benefits. These so-called holidays added up, and the debt multiplies over time.

“People didn’t pay attention,” said Rep. Kurt Granberg, a Carlyle Democrat who helped push for a plan to deal with pension payments. “They saw the pension obligations 20, 30 years down the road. It was fiscally irresponsible.”

You'll want to read the whole article.Via Illinoize.