One Chart Shows The Awful Fiscal Trajectory Of Chicago Area And Illinois

Tyler Durden's picture

Authored by Mark Glennon via WirePoints.com,

“Net position” is the government accounting term used for a balance sheet snapshot.

The chart shows net positions, in billions, for each of the last ten year ends, taken from the most recent CAFR, the Comprehensive Annual Financial Report, for Illinois, the City of Chicago (which are plotted on the right axis) and for Chicago’s two largest overlapping units of government, Cook County and the Chicago Public School District (which are plotted on the left).

Some of the drop in net position results from changes in pension assumptions and restatements resulting from changes in accounting standards. In particular, the drops from 2014 to 2015 are due largely to restatements based on new government accounting standards for pensions.

However, that doesn’t mean those losses should be disregarded. New assumptions and standards represent an admission that prior ones weren’t fairly representing financial condition.

Had the new standards been in place earlier, the losses would only have been pushed back into earlier years.

Aside from the terrifying trend, the chart also exposes the silliness of “balanced budget” claims.

All these units of government, to my knowledge, operated under budgets they claimed were balanced in each of these years (except the State of Illinois for 2016, during which it had no budget).

I asked Bill Bergman of Truth in Accounting for his reaction to the chart:

It’s fun, or sad and scary, or all of the above, to consider what this means for a citizen of the City of Chicago.

 

That person is not only a citizen of the City of Chicago, but is also impacted by the financials of the Chicago Public Schools, Cook County, and the State of Illinois.  

 

Adding things up, back in 2007, he was being told that things were basically flat. 

 

The latest aggregate net position came to over $250 billion — negative.  That’s a lot of dough.

Importantly, he added, “The accounting changes aren’t over.  We have yet to recognize retiree health care and other retirement benefits on the balance sheet, for example. We have a lot of ditch-digging ahead of us.”

Here’s a promise: The trend will continue. Recent tax increases will have little impact. Only drastic policy reversals, which aren’t in the cards with this General Assembly, would turn this around.

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J S Bach's picture

"Fun"?

Well. yes... if you're eagerly awaiting the great moment of cleansing.

Just remember... all of you... who it was and is that inflicted this insanity upon you.  Yes, we have ourselves to blame with selfish desires in all that the cretins promised us.  But, were our Constitution respected and taken to the letter, none of this would have progressed beginning with the bastardization of our currency in 1913.  When the new Constitution is drawn... many SPECIFIC notations will be made.  Our Founders cannot be blamed for not seeing the potential decadence of their descendants lured to their doom by a small clique hell-bent on destroying all of our history and accomplishments to date.  WE, however, KNOW.  Therefore, our duty is paramount - and we must fight to the death to reclaim this world against the eternal tribe of satan.

NoDebt's picture

What's going to happen to Chicago is exactly what should happen to Chicago.  The only frustration is that the same monetary rules don't apply to the Feral Government.

Expect a lot of name changes to various Chicago buildings in the next few years.  JPM Park, Cloud Gate brought to you by Blackrock, and of course the Goldman Cultural Center.

 

TBT or not TBT's picture

Gosh I hope they don't start seeing real violence break out in sensitive neighborhoods.  

vato poco's picture

all those years, whenever the scum pols and their pet vibrants would grunt "iss free, jus' swipe you EBT!", the boring stodgy old white guys would warn them, 'this shit won't last forever. then what, idiots?' .... and the pols and the vibrants and the experts and the media would laugh and laugh at the hopelessly old-fashioned fools (and raciss to boot no doubt!) who didn't understand the Miraculous New Paradigm. wouldn't get with The Program.

it's all gonna come crumbling down, mutthafukkaz, and won't don't crumble is gonna burn.

pro tip: don't come crying to us, chicago illinois theiving corrupt illiterate cunts. we're tired of your shit; we have no pity for you; and we have scoped rifles.

Manthong's picture

 

If Illinois, Cook County or Chicago could just start a central bank and print fiat, all their problems would be solved.

Slow Burning Rage's picture

Except some moron in the federal bureaucracy will bail them out and the rest of us will be stuck with the tab.  There is no accountability.  Time to tar and feather some bureaucrats.

Juggernaut x2's picture

While Chicago burns that fruity little jew mayor is getting into a pissing match with the Ricketts over the # of night games at Wrigley Field.

gregga777's picture

Rahm is there solely to drive Chitcago further into insolvency. It's all part of the Goldman Sachs Feral Reserve System's plan for financially destroying the United States.

gregga777's picture

Amendment XYZ: Any elected or appointed official who accepts anything of value, exceeding $1 cumulatively in US gold coinage, from any entity affected by any existing or future legislation or regulation or law enforcement action shall be immediately put to death.

hedgeless_horseman's picture

 

It’s fun, or sad and scary, or all of the above, to consider what this means for a citizen of the City of Chicago.

I would have left long ago.

Life is too short to live it in a Planet of the Apes movie.

brown_hornet's picture

Some of us are stuck here by jobs and family.

Most of the people I know who are retiring are moving to Tennessee.

vato poco's picture

"moving to Tennessee"

where they will all vote democrat, just like back home. Tennessee should turn them back at the state line.

Manthong's picture

 

“Life is too short to live it in a Planet of the Apes movie.”

“Planet of the Apes” is  Risa  compared to Chicago.

CrimsonAvenger's picture

"Da Titans" just doesn't have the same ring to it.

Decay is Constant's picture

Agreed. Ten years ago, perhaps I could have made that move. Now, kids are settled here and it's unlikely they move.

Job? Starting all over after 30 years of getting to know and work with/around the system. Even less appealing.

Between a rock and hard place.

Antifaschistische's picture

If you know anything about Public Sector Balance Sheets (and I do) you know they're a bunch of BS anyway.  Outside of cash/investments/real estate....they capitalize projects with no value as a course of business.   Private organization, in theory, have a liquidation value to many of their capital projects.  Take an Oil Company for example with their projects.  A Public Sector organization has NO business capitalizing so many projects to blow out their balance sheet.  It's NOT collateral...so why is it even there.

gregga777's picture

They have their captive tax slaves as assets.

Don Sunset's picture

Uh.......................I got nuthin'.

NoDebt's picture

Neither does Chicago.

 

historian40's picture

Chicago has been one of the seats of zionist power over the US for decades.  When the devil runs your State, is it any wonder when it goes through hell?

GoldenDonuts's picture

I thought that Illinois solved the problem by becoming a non state

are we there yet's picture

A100 billion here, a hundred billion there, after a while you are talking about real money.

Too-Big-to-Bail's picture

I'm surprised Illinois' population is still over 12 million

Dineroguru's picture

Chi-Congo.  Home of the Barry Soetoro "Choomgang" library, which will be run by people, like the rest of the city, that make the Somali pirates blush.

 

Golden Showers's picture

Is this, like, the bell curve or pin the tail on the donkey? What exactly are you saying?

The "net position" is not the territory. Does Rahm know about this?

 

Madcow's picture

Anyone caught not trying to bankrupt a major US city will be considered a terrorist and raped in prison

 

max2205's picture

Where's the chart on property taxes ect?   

rockstone's picture

They needed a 'toner run' before printing that.....

ChargingHandle's picture

Odumbo's clone budget policy for the nation was implemented and the results are quite similar. 9T was spent over the course of 225 +- years before Odumbass as a nation and Obamalo managed to match this figure in just 8 years. How will this end any better than Illinois? People won't believe how bad it will get when the roosters come home to roost. Our children will wonder with great dismay how we let it get so bad so fast and with bonuses granted and punishment absent. 

gregga777's picture

Don't you worry for the political parasites. They've got their bribery loot stashed in off-shore accounts in Panama, the Cayman Islands, Turks and Caicos (By the way, nothing to do with Turkey), Qatar etc. They'll be just fine so y'all worry warts just quit worrying about them.

Stormtrooper's picture

When I add up all the negative balances on that graph, I get about -$410 billion. Where the hell does the author come up with -$250 billion?

shrimpythai's picture

2 lines go to the right side figures - 2 lines go to the left side amounts  250 bill approx

shrimpythai's picture

2 lines go to the right side figures - 2 lines go to the left side amounts  250 bill approx

shrimpythai's picture

2 lines go to the right side figures - 2 lines go to the left side amounts  250 bill approx

NoDebt's picture

Golf clap for the rare and difficult triple post.

assistedliving's picture

Chicago.  Washington DC writ small

RozKo's picture

What does it really matter, they'll be eating each other soon enough, only so much corruption can happen before it all implodes.

Gold Dog's picture

The Best Damned Bancrupt City I Ever Lived In!

 

Dog

 

gramps's picture

The state of California will be the next domino to fall.

 

markl's picture

Sorry, no. New Jersey, Connecticut and Kentucky will fall long before California.

We have a couple trillion dollar industries here - silicon valley and hollywood. Until there's a major recession, cash flow is fine.

Kprime's picture

if all those states in the northeast lean together like a teepee they can prop themselves up for decades.

what happened's picture

As far as Connecticut is concerned, it is the unions that will be its downfall.  These people are trained to take every taxpayer dollar they can earn or extort and are immovable.  Recently, they promoted a "concession" which prohibits increases in salary for the next 3 years.  After that they get a 6.5% raise.  Looking very pious in their photo op, they held up signs that say 24 Million to represent the savings they are giving us taxpayers.  There are college professors who are making over 300,00 a year in pension with cost of living increases.  Can anyone but me see the insanity of this?

 

what happened's picture

As far as Connecticut is concerned, it is the unions that will be its downfall.  These people are trained to take every taxpayer dollar they can earn or extort and are immovable.  Recently, they promoted a "concession" which prohibits increases in salary for the next 3 years.  After that they get a 6.5% raise.  Looking very pious in their photo op, they held up signs that say 24 Million to represent the savings they are giving us taxpayers.  There are college professors who are making over 300,00 a year in pension with cost of living increases.  Can anyone but me see the insanity of this?

 

libertyanyday's picture

Ask the Yelling FED if they can run some deep statistical analysis of the data........ IL is going to be the first state to default.

gregga777's picture

I don't know. Connecticut and New Jersey are giving them a real run for their IOU!

devnickle's picture

"Shitcago, Shitcago" sing it!