Re:Illinois pension benefits have grown six times faster tha...
by blackbagboys on Wednesday March 28, 2018 @12:12PM
(#16698943)
Cutting spending and raising taxes are not both indistinguishable forms of “austerity”. In the U.S. political context, the former almost always means cutting essential services to the most precarious people in society and the burden of the latter is almost always born by those with the most resources to bear it.
Attempting to elide the two together under one term fundamentally misrepresents the politics of the situation and makes two very different options sound equally unpalatable.
Re:Illinois pension benefits have grown six times faster tha...
by sct202 on Wednesday March 28, 2018 @12:28PM
(#16699133)
In Illinois, several recent taxes have been sales tax increases which are effectively regressive. Also a our state income tax is a flat percentage, and a temporary tax reduction expired so that increase is also hitting lower income residents at the same time that services are being cut.
There are four solutions to this problem: austerity (cutting spending and/or raising taxes), default (cutting benefits), borrowing and federal bail-out. At this point, the first postpones the second if borrowing or a bail-out aren’t options. (Borrowing explicitly postpones it.)
Note that “default” doesn’t mean unilateral cutting. It is politically negotiated, and may involve the state giving pensioners something in exchange for reduced cash benefits.