Fat Cats Plot Ways To Destroy Bond Ratings To Sabotage Pensions

by Monica Davis

It’s bad enough that the banksters weakened pension funds with the mortgage crisis: now they’re plotting ways to destroy state retirement funds by sabotaging bond ratings.  Trillions of dollars in pension funds are invested in bonds; destroy the bond ratings; devalue pension funds; eliminate pensions.

The state of Illinois is the nation’s pension fund basket case. It’s tottering on underfunded legs and a few fat cats are plotting to kick its legs out from under it.

Let’s step inside a recent gathering of the corporate-backed Union League Club of Chicago, where former Illinois Attorney General Ty Fahner, who now leads a band of plutocrats known as the “Civic Committee of the Commercial Club of Chicago,” recently launched into an hour-long diatribe on the evils of state pensions.

Fahner, a top GOP fundraiser, can’t abide the notion that teachers, firefighters, nurses and other public workers in the state of Illinois can still expect a decent retirement. Not a luxurious retirement, mind you — the average pension is $32,000 a year, and most state employees will not receive Social Security. But even a modest retirement for hard-working people is too much for today’s fatcats. MOREHERE

It’s bad enough that the state pension funds are dangerously underfunded. Add plutocrat collusion to the underfunding and it may be the deatg knell for state pension funds. Illinois is the worse in the nation, when it comes to pension funding.

One of the biggest issues is a huge unfunded pension liability. According to the Pew Center on the States, Illinois is worst in the nation when it comes to setting aside enough money for its pensions. Its analysis of states’ pension funds in 2008 found Illinois had set aside just 54 percent of the money that’s been promised to its state workers and retirees.MOREHERE

The fat cats are gathering around the pension funds like wolves stalking a wounded elk. Make no mistake. They are moving in for the kill. Wall Street catastrophes, combined with pension fund managers’ bad investment plans, have gutted an already poorly funded state pension fund,.  Now it’s even worse: the fat cats are making plans to drive the state pension plant out of existence.

Financial institutions don’t have much faith in the Illinois pension system They showed their lack of faith by jacking up the state’s interest rates.

In February, Illinois borrowed $3.8 billion and paid a higher interest rate spread than any of the other 49 states. This means the financial markets believe that Illinois is the state most likely to default on its obligations. MOREHERE
 

If the Illinois state pension fund goes bust, many other underfunded system will fall like dominoes. But, that’s precisely what the fat cats are hoping for.