Mike Klonsky updates us on Rahm’s financial hustle.
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.
That is what is called “chutzpah.” He pays the pension contribution, borrows from the teachers’ pension funds, and lays off 1,400 teachers.
Diane Ravitch's blog 
It is beyond chutzpah…it is dictatorial and possible fraud. He takes over the pension fund and rapes it, then turns around and fires almost 1500 teachers to use their benefits for his own purposes. Impeach Rahm!
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Sorry..I exaggerated…1400 teachers and staff now without their careers and benefits. Impeach Rahm!
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Pathetic. So teachers victims? How about fighting back with another strike!
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Rahm didn’t learn anything from the election, did he? This is class warfare on the poor. Chicago, you should have elected the other guy.
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Great title: “Don’t Try This at Home” because he just did a naked backward double twist. He thought there was a net below. We’ll see.
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can it also be called “smoke and mirrors”? or “shell game”? the more different expressions and metaphors we have for this absurd behavior the better. I still like the word fraud…..
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reminds me of an article out of Fordham Institute by one of their Board members Podgursky: the title was “Principal Pension Payoff” and it is another example of their contempt for people in the rank and file…. all the while padding their own bank accounts. I sent several emails to Podgursky asking him who titled his article… Also, I wrote to two other board members at F.I. (but of course one of them is Smarick at Bellwether so that goes no place).
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Read more: http://www.washingtontimes.com/news/2013/aug/19/podgursky-how-to-rein-in-unaffordable-teacher-pens/#ixzz2cQSgFAr5
wanted to place here the type of article that Fordham Institute Board member Podgursky writes:
his first paragraph leads the reader to infer
“teacher pensions caused the Detroit bankruptcy”
Then, he insists on “cheaper” to get the taxpayers to jump on the bandwagon
and line up for the parade.
quoting Podgursky: “This is unfortunate given the fact that the costs of current pension plans are a huge source of fiscal stress in many states, and that a more modern, mobile and cheaper retirement benefit plan could better help public schools compete for academically talented, young and mobile college graduates.”
so I sent him an email: “I would have thought you would “clean up” the article before printing in the Washington Times. It is just another sign of the arrogance noted on the student reviews at your college when you abuse students in your classes on the Rate Your Professor. You abuse teachers and educational professionals with your battering ram of “cheaper” and your distorted math but It does play to the crowd.
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These “thinky tanks” (their address is Cambridge/Harvard) feed directly into the policy boards like NAEP and the Commissioners … The newspapers continue to report the statements of Governor Cuomo , Emanuel etc.
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Curious how Fordham responds to the situation in Ohio, where they publicly claimed that charter school accountability was necessary.
Jim Siegel-Columbus Dispatch “…some legislative Republicans have been reluctant to subject politically influential charter operators (GOP donors) to more disclosure… Republican Ohio Senator Lehner agreed to scale back disclosure in her proposed law.” June 27, 2015
Two questions for Fordham- (1) Does Ohio have the best government, money can buy? (2) Under the circumstances, poor charter school performance, lax accountability, political influence, do the backers of charter schools erode democracy, making them anti-American?
In 2013, Valerie Strauss, Washing Post, identified the Ohio Alliance of Charter Schools as recipients of $185,000 and $87,000 from the Walton Foundation.
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As a Roman Catholic I am baffled at how Fordham, which began as Catholic university, has strayed so far from its roots in the Church.
The Roman Catholic Church is pro-union and teaches so much that is antithetical to the radical Republican neoconservative thinking that is now promulgated by the university.
It makes me sick to my stomach.
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Chris, as a fellow Catholic I share your disgust and share too a quote from theologian Paul Tillich who said: ” All organizations are inherently diabolical, including the church.” By “diabolical” I take Tillich to mean “self serving, ” deceitful”, and the like. The more people like you and I point out the ocean between the gospels and the church the better. “Be not afraid.”
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It’s the Fordham Institute, a think tank, not Fordham University.
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Thanks for clarifying that FLERP! and not using any anti-Catholic rhetoric while doing it!
I had misread.
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They are promising a very generous interest rate with a quick turn around time.
I don’t know why the pension board is even considering it seeing as Illinois is setting up to burn the pension debt anyway – the more they give back the less they’ll have to give back to members.
Apparently this is all based on an issue of “cash flow” that will be alleviated by some future resolution from the state – why they would suddenly see the state legislature or governor as a source of credit on which they could bank on the city keeping its word I don’t know.
Put another way, half a billion is a lot to invest and give to members. Giving a loan to CPS or the city is yet another gimmick that will give the city money, increase the debt that will undoubtedly be wrapped up as yet more pension debt.
If you can’t collect on a loan, it’s not worth making. Why the city has any credit with the pension board is beyond me. Pensions are not credit cards yet that is exactly how Social Security and other states treat pensions and their pensions.
Collect the money from the workers, never intend to give it to them, or, use it and make it another politician’s problem in a few decades. We’re getting to that point a few decades later where the can can’t be kicked much farther before pensions start imploding.
Unfortunately, it is going to leave a slew of very poor elderly teachers with no way of making a living and in some cases no social security. Preying on our elderly government workers is sick.
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Apparently the answer to why is the city is going to pledge $750 million in buildings.
I understand using collateral, but does the pension board have ANY power or even capability to manage a real estate portfolio were they to default? I also suspect that if it did come to a default, they would seek judicial relief from the debt before they actually cough up the deeds to the buildings.
Rauner apparently WANTS CPS to go bankrupt – it seems he’s itching for a reason to ride in and take control of both the school system and pensions and negotiations with the union which could only set up a show down that he will have the upper hand in winning.
Is he angling to be Scott Walker?
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The board of the pension fund — 9/12 of whom are elected by and answer to current and retired teachers, not the mayor — has approved the mayor’s deferment plan. It requires monthly payments and is guaranteed to earn 7.5% in interest.
http://www.chicagobusiness.com/article/20150701/BLOGS02/150709984/budget-doomsday-cps-edition-heres-what-it-looks-like
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The city apparently has pledged its buildings as security.
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I seem to remember a time in the 1970s when NYC was bankrupt and the teacher’s union lent money to the city in return for a very teacher-positive contract that enshrined many of the rights teachers have come to take for granted.
Why isn’t the Chicago teacher’s union using this as an opportunity to wring some concessions out of the mayor?
Teachers are too often our own worst enemies because we refuse to play hardball and want everyone to just get along and be nice. It’s biting us in the in *ss more and more, isn’t it?
We need to get over the ‘seat at the table’ mentality and overthrow the table.
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Damn!
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He seems to be out of control.
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Exactly! I feel like every time something major happens they are just trying to divert our attention from the hand that is performing the real trick behind our backs. I
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Rahm’s racketeering is just a drop in the bucket here in Chicago. Mayor Daley drained our pension fund in less than 20 years for his assorted “public improvement” projects. Several of which are currently non-operational. Read more at: http://windycityteachers.blogspot.com/2015/06/where-did-money-go.html
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Reblogged this on David R. Taylor-Thoughts on Texas Education.
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The entertainment industry’ s attacks on public education may be a result of super agent Ari Emanuel’s influence.
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