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5/01/2013

House Amendment 1 to Senate Bill 1 passed out of House Committee this morning despite vehement testimony in opposition from IFT President Dan Montgomery and other members of the We Are One labor coalition.

"This Madigan mega-bill is like the Corvair. There were things about it people liked, but it was unsafe at any speed," said IFT President Dan Montgomery during media interviews after his testimony.

Good morning, madam chair. Thank you, and members of the committee, thank you for the opportunity to talk. I am Dan Montgomery, President of the IFT.


Right now I guess it’s almost 9:00. In schools all over Illinois on this beautiful day, we have teachers who’ve been at work, for at least a couple hours probably, teaching class. We have university professors and community college teachers hard at work. We’ve got firemen on call, police on the job, nurses in hospitals, and all of them have paid out of every paycheck their contribution to their pension, whether it’s 9.4 percent for teachers, 12 percent for some police and so on. But they have made this payment every paycheck and they’re doing the work of the state as we need them to do. 

As we have said, benefits are not the problem here. Cutting benefits is not the solution. We have to find a solution. There’s no question. We’ve made the point clearly and consistently in our testimony here and over the last year and a half, I suppose, that there has to be a constitutional construct.  There has to be a legal way to fix this.

I am convinced, I think we’re all convinced, there are ways to do that. We’ve offered ideas over some time now, including in legislation. Sadly, those ideas, I think, have fallen on deaf ears to a great measure. And if we pursue this, if you pass this amendment, we won’t be further toward a constitutional solution. We won’t be further to a pension solution that the state needs.

But we are looking, as Henry said, at a massive cut to benefits. We know if you look at the causes of the pension underfunding that something like less than 10 percent has any relation to benefits. The single largest cause is the underfunding over time; the 2008 financial crisis is about a quarter of it. So the cutting of benefits is in fact not the path to a solution.

Providing fiscally responsible stream towards funding and other solutions can get us there. But when we have teachers and other workers who do not get Social Security being forced to accept a 30-35% cut in their lifetime retirement, we see that as unacceptable, especially when it doesn’t offer a solution to the pension problem. And I would second those comments.

Imagine if the discussion in Washington were, “How do we cut Social Security by 30-35 percent?” I think we as a country would agree that that is not a viable path to the kind of nation we want. And I would put it to you that this amendment is not a viable path to the kind of state we want.

Thank you.

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