TIA's Analysis of Governor Pritzker's Economic Report
November 15, 2022
On November 14, 2022, Illinois Governor JB Pritzker issued a press release touting the findings of the state's annual Illinois Economic and Fiscal Policy Report (the Economic Report). In the release, he claimed:
Illinois is in its best fiscal shape in decades
The state's projected long-term budgetary deficits will be nearly eliminated
Extra money will be put into the pension systems, and $200 million will be added to the rainy-day fund
This press release and the Economic and Fiscal Policy Report are misleading because it omits material facts about the state's finances, such as:
Illinois is more than $200 billion in debt.
Illinois' long-term deficits will continue because the state will continue to short-change its pension systems by billions of dollars.
The money being added to the rainy-day fund exists because even with the extra money, the state is not paying the minimum on the pension system's credit cards. READ MORE HERE
Illinois Credit rating upgrades lead to more borrowing
June 9, 2022
On the heels of credit rating upgrades, Illinois has sold $1.6 billion worth of bonds to fund a pension buyout program and construction projects. As the Chicago Tribune reported, Gov. J.B. Pritzker touted the upgrades lauding Democratic leaders for their work “to make sure that we’re back in good fiscal order, that the state is building its fiscal foundations for the road ahead.” But as Hetty Chang of Moody has stated, ratings are not “public policy report cards, although politicians may use them as such.” Credit ratings do not focus on the overall financial condition of the state; they focus on the likelihood of bonds being paid.
And if the state is in such “good fiscal order,” then why did it need to borrow money?
April 5, 2022
Congratulations to Kansas for winning the national NCAA basketball championship beating North Carolina 72 – 69, but North Carolina’s taxpayers are better off. Kansas’ Taxpayer BurdenTM is $7,500, while each taxpayer’s burden in North Carolina is $1,400. This means each taxpayer in Kansas will have to pay $7,500 in taxes in the future for bills that the state has already accumulated.
The State of the Union Address Should Include the Financial State of the Union
February 28, 2022
To understand the state of the union we must understand the financial state of the union. Fortunately, for the first time in years the Financial Report of the US Government was issued (February 17) before the State of the Union address. Will the President mention the important information included in the report?
Illinois’ Carnival Barkers Including Pension System Actuaries and Many Others
February 2, 2022
Includes: In his budget address, Governor JB Pritzker suggested that people who questioned his plan and statements are carnival barkers. If that is true then carnival barkers include basic mathematicians, the state’s pension systems’ actuaries, SEC officials and those who drafted the state’s latest bond offering.
National debt reaches $30 trillion A Long Time Ago
February 1, 2022
Includes "The Treasury Department's reported debt doesn't include the Social Security and Medicare liabilities. If those liabilities were included, a $30 trillion national debt amount was reached years ago. ... Please do your part and send a check to the US Treasury Department for $919,000 to cover your share."
Chicago in debt despite balanced budget and federal aid
September 21, 2021
Includes "Yesterday, Mayor Lori Lightfoot proposed her fiscal year 2022 budget for the city of Chicago. Thanks to the much anticipated federal aid, Lightfoot has proposed several shiny new programs while not increasing taxes. But the city was deep into debt long before the pandemic started."
Illinois’ tardy financial report receives a qualified opinion
August 30, 2021
Includes" It’s back-to-school season and this year not only did Illinois turn in its annual financial report late but it also received a bad grade: a qualified audit opinion. Illinois’ annual financial report was released to the public on Thursday, August 19 for the fiscal year ending June 30, 2020. This means we just received the results of a fiscal year that ended more than 400 days ago."
The Governmental Accounting Standards Board continues down the wrong path
July 15, 2021
Includes "Unfortunately at the July 1 meeting the Board and staff continued to focus on maintaining these funds using a short-term perspective. While I am not against accounting for the governmental funds' inflows and outflows using the short-term perspective, I believe that governmental funds accounting should include a balance sheet and income statement prepared using the long-term perspective, on a full accrual basis."
Does Cook County have a 'surplus?'
June 29, 2021
Includes "At a press conference last week, Cook County President Toni Preckwinkle announced a projected budget surplus. When most people hear that the county has a surplus they think it means there is a surplus of money to spend. But that is not the case."
Learn budgeting basics from the City of Chicago?
June 14, 2021
Includes "I got very excited when I saw the image below in an email I received from the Chicago Treasurer. I thought the mayor and aldermen were finally going to learn how to budget. In the past Chicago mayors and aldermen have done budgeting in a way that has allowed them to claim 'balance' while incurring billions of dollars of debt."
What is fraud and are government officials committing it? Part II
May 27, 2021
Includes "When I was researching the Securities and Exchange Commission (SEC), its role in municipal securities, and Chair Gary Gensler’s appointment, I ran across an interesting SEC legal bulletin titled, “Application of Antifraud Provisions to Public Statements of Issuers and Obligated Persons of Municipal Securities in the Secondary Market” issued February 7, 2020."
The SEC’s job is bigger than just protecting the investors, Mr. Gensler
May 20, 2021
Includes "Last month, Gary Gensler was sworn in as the new chair of the Securities and Exchange Commission (SEC). Will he use his experience at Goldman Sachs and in senior government financial positions for the public good or will he just use this position to bolster his resume?"
What is fraud and are government officials committing it? Part I
May 10, 2021
Includes "I am an accountant, not an attorney, so I am no expert on what is or isn’t fraud. But when I hear elected officials make misleading public comments about their government’s finances I often wonder if they are committing fraud."
A trillion here, a trillion there: Whatever the amount, it is spinning too fast
April 15, 2021
Includes "Now that our calculations for our Financial State of the Union are complete, which are based upon information in the recently released Financial Report of the U.S. Government (FRUSG) for fiscal year ended September 30, 2020, we have found that we need to adjust our debt clock. The good news is the clock “true debt” decreased."
We need a real fix for Social Security
March 9, 2021
Includes "Congress has not figured out where the money will come from to pay $44 trillion worth of promised Social Security benefits over the next 75 years. In other words, the Social Security program has a long-term cash shortage, which can only be fixed one of two ways: bring more money in or take less money out."
Illinois budget gimmicks continue; we have an opportunity to fix them!
February 17, 2021
Includes "Today in his budget address, Gov. J. B. Pritzker claimed he has once again balanced the budget. Yet Truth in Accounting calculated that the state needs more than $226 billion to pay its bills, which does not include pandemic-related expenses."
National debt grew 39 percent under Trump
January 19, 2021
Includes "As Trump ends his term as President of the United States, he leaves behind quite the legacy. Included in his legacy will be a $7.7 trillion increase in the national debt, which amounts to almost $24,000 per person. This represents a 39 percent increase."
Citizens deserve the truth about government finances
December 18, 2020
Includes "At a time when state and local governments have to make tough choices due to COVID-related budget shortfalls and the federal government is contemplating more aid in another stimulus package, citizens deserve to know the extent of their governments’ financial troubles now more than ever."
Illinois' and Chicago's budget gimmicks
October 21, 2020
Includes "This year every city and state in America is struggling with acute fiscal shortfalls. Illinois estimated a budget deficit of $6 billion and Chicago’s budget deficit is expected to be $2 billion."
Eleven years of the Financial State of the States
October 5, 2020
Includes "Last month, Truth in Accounting released the eleventh edition of our flagship Financial State of the States report. I cannot believe it's been 11 years since we began this endeavor to bring citizens truthful and timely government financial information..."
Summary of special briefing on how cities and counties are coping with COVID-19’s fiscal shock
July 22, 2020
Includes "On Thursday, July 16, I listened to a Special Briefing on How Cities and Counties are Coping with COVID-19’s Fiscal Shock hosted by The Volcker Alliance and Penn Institute for Urban Research (IUR)..."
Summary of special briefing on COVID-19: Unemployment, and state and local fiscal consequences
June 26, 2020
Includes "On Thursday, June 25, I listened to a Special Briefing on COVID-19: Unemployment, and State and Local Fiscal Consequences. It was co-hosted by The Volcker Alliance and Penn Institute for Urban Research."
June 10, 2020
Includes "Economic shocks like the one we’re facing right now, by definition, do not give much notice. And while the emergence of COVID-19 and the extended lockdown was not on any state legislature’s or governor’s radar at the start of this year, the economic disruptions of the last several decades should have given states an incentive to be fiscally prepared."
Truth in Accounting's conditions on federal aid to state and local governments
May 14, 2020
Includes "Any aid package should require state and local governments to develop fiscal stability plans that would address financial imbalances before the crisis arrived, and take steps to ensure governments are financially prepared for future crises."
May 7, 2020
Includes "Today I realized that our debt clock was moving too slowly. I had to increase the debt clock by hundreds of billions to match how much the Treasury is currently borrowing. In April, the reported debt increased by $1.2 trillion dollars to almost $25 trillion."
Federal Reserve loans will set governments back
April 17, 2020
Includes "The Federal Reserve loans will financially set these governments further back for a long time, if not forever. To pay back this new debt, governments will have to run true surpluses. Before the current crisis, only ten of the states had run annual surpluses that have enabled them to amass money available to pay future bills."
My takeaways from Gov. Pritzker's budget address
February 19, 2020
Includes "Gov. Pritzker says the budget will fully fund the statutory contributions to the pension plans. These statutory contributions woefully underfund the plans. Last year, the state shorted the plans by more than $4 billion using this funding scheme, which has been called a balloon payment on steroids."
February 12, 2020
Includes "President Trump’s budget simply looks at revenues and expenditures for fiscal year 2021. It does not include the Social Security and Medicare benefits that workers have been promised and are earning now."
A response to the city of Phoenix's 'invalid' claim
February 10, 2020
Includes "Pension debt is similar to credit card debt, not a mortgage, because it is debt accumulated to cover costs that have already been incurred. Evidently Phoenix has a plan to pay the pension debt off over the next 22 years, but this does not negate the fact that this debt exists today. To explain this concept on a personal level, someone who plans to pay off a credit card balance over time by paying the minimum payments still has outstanding credit card debt now."
Fed Chairman to empty Senate hearing: ‘National debt growing faster than economy’
December 17, 2019
Includes "'The debt is growing faster than the economy, it is as simple as that in nominal terms, and that is the definition of unsustainable,' Federal Reserve Board Chairman Jerome Powell warned the Joint Economic Committee on November 13, 2019."
Pensions are a present obligation
December 12, 2019
Includes "Private companies must report and fund their employees’ pension plans as benefits are earned. So why are governments held to a different standard?"
My statement on Illinois' late report
August 28, 2019
Includes, "Today I received an email from Frank Mautino, Illinois Auditor General, announcing that he will be releasing the state’s Comprehensive Annual Financial Report (CAFR) tomorrow, Thursday, August 29, 2019, at 10:00 a.m. CT. This audited report provides citizens with the best financial information issued by the state, such as the amount of unfunded pension and other retirement promises."
Illinois constitutional amendment needed - Part 1
May 9, 2019
Includes "Illinois lawmakers and voters are in the process of amending the state constitution to allow for a progressive income tax. Springfield is looking for more revenue because lawmakers habitually spend more than the state takes in."
Are government officials more important than taxpayers?
March 14, 2019
Includes "The GASB was established as an independent board whose mission is to 'educate stakeholders on how to most effectively understand and implement [accounting] standards.' Citizens and taxpayers are the greatest stakeholders in a government’s financial reports. So why is the GASB seemingly on the side of government officials?"
Why 2018 has been the best year yet at TIA
December 19, 2018
Includes "As my Facebook friends know, I post my 'good news of the day.' With the focus of my work being government budgeting and accounting—where the federal debt is now more than $100 trillion and states’ debt more than $1.5 trillion—you would think there isn’t much good news to report. But I believe everyone can find something good in all situations.
There's a lot to grateful for this year
November 20, 2018
Includes "On July 16—after spending too much time on Facebook and reading so many negative posts—I decided to start posting my 'good news of the day' update and asking my friends to share their good news. As Thanksgiving approaches and I look back at my posts, I realize I have been putting together the things I am thankful to have in my life."
November 15, 2018
Includes "Many taxpayers and voters would be surprised to learn that this is not the case for the state governments that manage their tax dollars. Each year, states issue financial report cards to their citizens in the form of a comprehensive annual financial reports (CAFR.) After analyzing all 50 of these complex documents, only 15 state governments used outside audit firms to double check their work."
Responding to common questions, criticisms about our work
October 22, 2018
Includes "Truth in Accounting’s grading system is rooted in our holistic perspective on government finance. Our grade is based upon the government’s overall financial condition. We care about the big picture and the risk to the taxpayers."
Blame game: Why this accounting rule should be praised, not criticized
May 23, 2018
Includes "... saying this accounting standard is the reason for the hospital’s poor financial condition is like blaming your credit card company for your bad credit score while you have a huge outstanding balance on your account."
This state lawmaker gets government finance
March 21, 2018
Includes "Kudos to California state Sen. John Moorlach for his understanding of government finances and how to determine the true fiscal condition of a government."
Reflections on International Women's Day
March 8, 2018
Includes "One of the goals of International Women’s Day is to empower women. I believe we should work to empower everyone."
Will Trump address the financial state of the union?
January 29, 2018
Includes "Despite the bankruptcy of a few of your companies, because you are a successful businessman, I assume you understand the importance of a company’s finances."
A rebuttal to Delaware treasurer's 'misleading' claim
October 16, 2017
Includes "In our analysis of state governments’ financial condition, we calculate 'money needed to pay bills.'"
Highlights of Chicago's Municipal Employees' Annuity and Benefit Fund
August 21, 2017
Includes "If you are into horror movies and like to be scared, take a look at the actuarial valuation of Chicago’s Municipal Employees' Annuity and Benefit Fund (MEABF)."
Social Security: TIA checks the facts
August 17, 2017
Includes "In response to our Social Security videos, I have compiled a list of references we used for the video and my interpretations of the material."
My Opening Remarks at the Illinois Issues Forum
August 10, 2017
Includes "I was invited to be a panelist at the Illinois Issues forum entitied "State Budget: The Challenges Ahead", hosted by the Union League Club of Chicago, NPR Illinois, and AARP."
My invitation to comment at GASB
June 15, 2017
Includes "I was invited to comment on a proposed GASB standard change regarding the accounting for special funds. Here is my testimony to the board."
What exactly is a special fund?
June 9, 2017
Includes, "Illinois has some very unusual special funds, such as..."
Suspension of the debt ceiling
May 31, 2017
Includes, "The federal government’s debt is no longer increasing. This sounds like great news. The government isn’t borrowing any more money. But don’t get your emotions too high."
Congressman Brad Schneider hosts a federal budget workshop
April 12, 2017
Includes "This is why I am excited to announce the Concord Coalition and my Congressman, Brad Schneider, are hosting a federal budget workshop at 5:30 p.m. on Monday, April 17 at Lake Forest College. Space is limited due to the workshop format."
March 7, 2017
Includes "Yesterday Illinois State Comptroller Susana A. Mendoza finally released the state’s fiscal year 2016 financial report. This was 251 days after the fiscal year end, which is considered late even under the loose government standard of 180 days. More than 30 states had released their reports before Illinois."
Our national debt: one veteran's view
September 19, 2016
Guest post by H. Lee Fisher, includes "The risks posed by our national debt places this nation in self-destruct mode. Our politicians can continue to manipulate accounting records and conceal our real debt..."
Illinois Teachers Retirement System underfunding equals 679% of covered payroll.
August 12, 2016
If instead of paying Illinois teachers for the next six and half years, their salaries were diverted to their pension plan, there still won't be enough money to cover all promised benefits.
Illinois transportation lockbox
July 21, 2016
Includes, "The amendment is an attempt at circumventing some of the accounting gimmicks used to balance the state budget."
When will Illinois' finances come to a head?
June 16, 2016
Includes, "When will the governor and legislators come to their senses? When the state can't borrow any more money any more."
April 28, 2016
Includes, "Did you know that the federal government does not follow the same accounting standards that they require major corporations to follow?"
April 26, 2016
Guest blog post by William Glasgall. He is director of state and local programs at the Volcker Alliance in New York.
Are vendors and nonprofits de facto creditors to Illinois?
April 20, 2016
With Leslie Munger's delayed payments to state officials, office holders have joined the ranks of de facto creditors to the state.
Illinois budget: defining & funding the essential priorities recap
April 13, 2016
My recap on Monday's event that we co-hosted with the Illinois Campaign for Political Reform
Illinois finally releases its audited financial report
April 12, 2016
My thoughts on the state's recently released financial report.
TIA focuses on the numbers, rather than solutions
February 17, 2016
My response to a Facebook comment regarding Gov. Rauner’s 2017 budget address today.
Governor Brown's State of the State
January 1, 2016
Includes, "Yesterday I listened to Governor Jerry Brown’s State of the State with an ear out for the true financial state of California."
January 14, 2016
Includes, "The federal government is the largest financial institution in the world, yet the President did not discuss our financial position."
It's not just an accounting thing
December 3, 2015
Includes, "State and Local Governments' Balance Sheets Are About to Explode"
Can the US government gobble up $339 billion in one day?
November 5, 2015
Includes "At the same time Americans guzzled on Halloween candy, the federal government gorged on debt..."
Six Social Security myths and truths
October 30, 2015
Includes "Governor Christie is correct, politicians and government officials have created many myths about Social Security and Medicare..."
October 28, 2015
Includes "Watch out when government officials tell you they have a surplus..."
October 14, 2015
Includes "there are two possible nightmare scenarios for America's financial future...