SHARKEY NAILS IT -- CTU's Jesse Sharkey responds to Rahm Emanuel's school cuts. He explains clearly how Chicago got into its financial mess, with the current mayor leading the way, and offers a way out through revenue reform. Here's a copy of CTU's Budget Brief.
I wonder if Greece or Puerto Rico could try this? Just borrow the money from your debtor to pay off your debt. Or maybe that is what they've been doing.
Rahm Emanuel, who learned his creative financing tricks, like "scoop and toss" bond financing while working for Bruce Rauner at GTCR, plans to borrow $500M from the Chicago Teachers Pension Fund, one day after paying the Fund $634M in overdue required city contributions.
The real cost of this trickery is felt right in the classroom with 1,400 teachers and staff being hit with lay-off notices yesterday.
The Sun-Times reports:
Although pension fund trustees expressed their “general overall support,” it wasn’t without a heavy degree of hand-wringing.
One trustee questioned the idea of “hoping Springfield can come through for us” in the toxic atmosphere of a state budget stalemate between Democratic legislative leaders and Republican Gov. Bruce Rauner over Rauner’s demand for pro-business, anti-union reforms.
Another trustee warned that the teachers pension fund is “not a bank” and even if it were, “You’re [going to] a bank that, in the past, you haven’t been making your payments to for your mortgage to ask for a loan. I don’t think that would pass any underwriter’s approval.”Rahm's plan is so crazy, it just might work. Like paying off your credit card bills using those checks the other credit card company sent you in the mail. I actually tried this back in my college days. It worked for about two months.
But please, don't try this at home. Especially with all those federal investigators, grand jury hearings, and the SEC in town.