Credit Downgrade Continues to Hi-light Poor Illinois Economy
August 29, 2012, bestowed a shocking reality to the State of Illinois. Standard & Poors Rating Services dropped Illinois credit rating from an A-plus to an A. Might not seem so bad if we were talking about a grade received on a test in school; however for the State a credit drop continues to show that we have not fixed our economy.
The credit rating downgrade is cited due to the state’s lack of action in fixing the unfunded pension liability and overall financial weakness. I agree that employees individually are not responsible for our pension crisis. Due to lack of funding, pension sweeteners negotiated by unions, and people living longer the state finds itself in this predicament; however, adjustments are needed to stabilize our pension systems and ensure the state can continue to offer retirement benefits to teachers and employees.
Governor Quinn commented, “Eliminating our $83 billion unfunded pension liability is vital to getting our financial house in order. Action by Standard Poor’s is more evidence that we must act.” I believe state employees have worked hard and faithfully, and deserve a retirement plan that is dependable and affordable to the taxpayers for the future.
If the state does not address the ongoing pension liability factor, this credit downgrade is only a taste of negative impacts to come. The unfunded pension liability must be addressed with urgency in order for the state to preserve fiscal responsibility. Additionally, we must continue to put our limited state resources into areas that create wealth and jobs rather than public programs that allow people to be dependent on government.