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Officer Down

Monday, March 18, 2013

PENSION: Quinn, Madigan taking their case on pension reform to trade unions

 "For certain people who retire early and live a long life, they may actually make more in retirement than they did on active status," Madigan said. "That's why there is this strong effort to move legislation that would reduce the benefit level."

--Yes, because we wouldn't want anyone making money like Mr Madigan and his cronies.
His pension, and that of any current state legislators or office holders like Governor Quinn, would not be touched by any new legislation. 
As a matter of fact his pension is currently worth more than what he makes right now as Speaker of the House.--

Story at Chicago Tribune

Top Democrats seeking a wedge in talks with government workers
By Monique Garcia and Ray Long, Chicago Tribune reporters

March 19, 2013

As members of the state's largest public employee union spent much of last year chasing Gov. Pat Quinn to protest closed facilities and canceled raises, their trade union counterparts could often be found clapping as he cut ribbons for road projects or doled out money to overhaul sewer lines.

Though unions typically are known for solidarity, the contrast illustrates what's at stake for workers in Illinois: Those who have toiled away for the government desperately want to hold on to their standard of living, while laborers reeling from years of unemployment are happy to take what jobs come along.

It's a situation that Quinn and other top Democrats are hoping to take advantage of as they seek to cut costs in the state's public employee pension system. The idea is to use unionized electricians and plumbers who might benefit from pension reform — be it more money for construction work or an overall economic jump-start — to pressure their government worker comrades into cutting a deal that decreases retirement benefits.

It's a new twist in the push to reduce the state's nearly $97 billion pension debt, but it's unclear if it'll work. Laborers who won't be affected by state pension system changes may not see the need to twist arms of union allies in government. And there's little guarantee state workers would listen.

Quinn calls the move "coalition building," noting he's also requested lobbying help from business groups and university leaders who've seen funding cut as more and more dollars go to pension obligations.

Henry Bayer, executive director of the American Federation of State, County and Municipal Employees Local 31, which represents almost 40,000 state workers, argues it's an attempt to "divide and conquer."

Although the governor doesn't use such forceful terminology, powerful House Speaker Michael Madigan, D-Chicago, has made it clear that he wants to turn up the pressure. He contends AFSCME has acted as an obstructionist rather than a partner during pension negotiations.

"I know how it is in unionism. There's solidarity and there's brotherhood," Madigan told the Illinois Brotherhood of Electrical Workers last week in Springfield. "But I think the time has come where all of us have to call upon Henry Bayer and the AFSCME union to recognize the reality of the facts and these numbers. It's not just his money. It's not just the money of the AFSCME members. It's all of our money."

Indeed, Quinn has maintained a relatively healthy relationship with trade unions compared with his high-profile battles with AFSCME. The union's members booed the governor off the stage during his summer rally at the state fair. It even dispatched a rolling billboard to the Democratic National Convention in Charlotte, N.C., featuring a picture of Quinn with the word "unfair" stamped over it.

The government workers union demanded that the governor honor raises and reverse his decision to close several prisons and homes for the developmentally disabled. They accused him of abandoning the middle class and threatened to strike as negotiations for a new contract stretched for a record-setting 15 months.

By comparison, Quinn has been greeted with hugs and slaps on the back by trade union leaders, who say the governor may not be perfect but has done his best to get their members back to work. They point to his signature on the state's first public works program in nearly a decade, which raised liquor taxes and license plate fees and legalized video gambling to pay for new schools, bridges and roadways.

Quinn invited Larry Swope, executive director of the Illinois Pipe Trades Association, to attend the governor's annual State of the State address. Though such support could come in handy in the 2014 governor's race, Quinn also hopes for a more immediate benefit — achieving money-saving pension changes after more than a year of failure.

"I think the trade unions in particular that have had to take sacrifices on their pensions in the private sector know how difficult this is," Quinn said last week after a speech to the electrical workers. "And I think it's important that the trade unions express to the public-sector unions that we've got to move forward and do the right thing for the public."

Pitting union against union is an old — but far from foolproof — strategy.

Bob Bruno, a professor of labor and employment relations at the University of Illinois at Chicago, said such a move sets the stage to create considerable backlash, similar to what happened in Wisconsin when Republican Gov. Scott Walker pushed to curb collective bargaining rights. The professor pointed to Quinn's recent symbolic decision to cancel AFSCME's contract while both sides were trying to negotiate a new one.

This month, Quinn and the union reached a tentative deal on a new contract. But the earlier cancellation of the contract that employees had been working under sparked outrage among unions, whose members flooded Quinn's offices with letters and phone calls.

"The message was, 'It's one thing to take a hard line, but this is not showing respect. If you can do it to them, you can treat any of us this way,'" Bruno said. Dividing unions "is a very risky approach… and if it has the governor's hands on it, or Madigan's hands on it, it's not going to be well received when these unions get into a room together and talk about how they might go forward."

Still, some trade union leaders acknowledge a lot has changed during the Great Recession. The economy left some sections of their workforce with unemployment rates reaching 50 percent, and they've all had to overhaul their own pension systems to prevent implosion.

"All of us have pension obligations that we're trying to fulfill," said Michael T. Everett, president of the West Central Building and Trades Council based in Peoria. "Hell, those are our brothers and sisters. And there's no sense dancing around and pretending it's all going to go away. ... When the alternative is insolvency, the next step from that is do the best that you possibly can."

Others contend state government workers already did their part by contributing money into the pension system while lawmakers and governors skipped payments or ran up debt by borrowing to pay the state's share.

"We understand something has to be done, but you can't punish people for fulfilling their end of the bargain," said Brian Rainville, executive director of Teamsters Joint Council 25.

Despite accusations that AFSCME has failed to work with lawmakers to reach a middle ground on pension reform, Bayer notes the union has put forth its own proposal. Under the plan, government employees would agree to contribute 2 percent more of their paychecks for a guarantee that the state would not skip pension payments. The union also suggests raising $2 billion in corporate taxes.

"If there is an attempt to divide the private-sector and the public-sector unions, I don't think it's going to work," Bayer said. "It's not as if the public sector are saying we aren't willing to negotiate."

But Quinn and Madigan said the union offer does not go far enough, arguing the real cost driver is a 3 percent compounded cost-of-living increase in retirees' pension checks.

"For certain people who retire early and live a long life, they may actually make more in retirement than they did on active status," Madigan said. "That's why there is this strong effort to move legislation that would reduce the benefit level."