CHICAGO | Economic & Business Development

[LouisVanDerWright]

TUP, there's no point in even discussing it, there is no way to actually pay the pension obligation revenue or not. The problem keeps getting bigger and bigger and nothing can or will be done about it.

Let's be real people: the State of Illinois is having difficulty servicing these costs during the lowest interest rates in the history of human civilization and what is likely to be the longest economic expansion in US history.

What exactly does anyone expect will happen next time rates spike and a recession occurs? How will this debt be serviced if Illinois needs to start paying 5, 6, 7, 8%+ on it? How will that work if those rates couple with falling revenue due to economic downturn? The fact is no amount of new revenue is going to make the numbers work. The State, and to a lesser extent Chicago itself, has a date with destiny. There will be a default and bankruptcy of some kind that wipes all of this nonsense out. I just don't see any path to cut obligations it's pretty much mathematically impossible to extract enough revenue to catch up with taxation. So the only endgame is a Federal bankruptcy court of some kind quashing the pension amendment and writing off some of the obligations.