Chicago—America’s third largest city—is teetering on complete financial collapse and is set to follow Detroit’s path down to Third World ruin as its nonwhite population rises to over 70 percent and whites continue to flee the ever-increasing crime and chaos.
According to a new report in the City Journal newspaper, “even as Chicago grapples with nightmarish violent crime, the city faces imposing fiscal challenges.”
The report continues by saying that the city, “which says that it will collect about $8.5 billion in local revenues this year,” is burdened by an “astounding $28 billion in unfunded pension liabilities and another $9 billion or so in money that it owes to general-obligation bondholders, as well as billions more in other debts.”
“Chicago’s bonds, graded as “junk” by analysts, are among the lowest-rated of any major municipality.
“It’s becoming increasingly difficult to see how this ends well in the Windy City.”
According to the US Census Bureau, as of July 1, 2017, Chicago had 2,716,450 residents. Of that number 32.3 percent were classified as “white”—and that is by using the notoriously inaccurate Federal definition of “white,” which means that the actual white population is much lower than the official figure.
A further 30.9 percent were classified black, and 29.1 percent “Latino”, which other nonwhite groups making up the rest. “Foreign born persons” were 20.9 percent of Chicago’s population.
The city hall masters in Chicago have devised a “plan” to solve the pension shortage crisis, which is all predicated upon the city’s revenues either staying stable or even increasing. This is, of course, where the plan will fail, as the more nonwhite the city becomes, the less the revenues will become, as has happened in every other major metropolitan area taken over by nonwhites in America.
As the City Journal explained: “Chicago’s chief financial officer and a financier close to Mayor Rahm Emanuel proposed the idea that the city would borrow $10 billion through a bond offering to shore up its pension system, using a dedicated revenue stream in order to persuade investors to come on board.
“The plan would seek to offset the pressure that the city faces from accelerating pension payments that it must make in coming years. Under a long-term plan, the city must double its pension payments again over the next five years, and then keep increasing payments steadily every year for the next 30 years.
“Even then, the plan would get the system back to only 80 percent funded, if everything else about the system’s projections stays on course.”
The City Journal went on to point out that the “problem is that those kinds of returns are far from a sure thing. That’s why pension bonds have been behind some of the biggest fiscal meltdowns in recent years.
“Stockton, California, for instance, borrowed $125 million in 2007 to bolster its underfunded retirement plans and gave the money to California’s public-pension system to invest.
“The system’s investment professionals promptly lost more than a quarter of the principal, exacerbating an already-emerging crisis, which provoked city officials to file for bankruptcy.
“Detroit, eyeing the same kind of sharp increases in pension payments that Chicago faces, created a complex pension-financing scheme in 2005 to raise money by circumventing Michigan’s limits on municipal debt. After the market crashed in 2008, the deal blew up. A financial manager brought in to clean up the mess took one look at Detroit’s retirement obligations and hauled the city into federal bankruptcy court.”
The City Journal does not, of course, point out the obvious fact that both the examples it used to prove the point are cities which have long since tipped well over 80 percent or more nonwhite.
“The big losers in all this may be taxpayers and borrowers of previous Chicago debt, who should be looking with panic at the city’s maneuvering. Chicago is now guaranteeing the debt of its newest bondholders by dedicating specific tax dollars to repay them.
“Detroit did the same thing, pledging revenues from casino taxes to reimburse some lenders. Those lenders did get paid in full during the bankruptcy, but other Detroit bondholders, including some who held Detroit’s general-obligation debt, previously thought to be among the most secure forms of municipal debt, took a big loss, or ‘haircut,’ when the city went bust. Detroit eventually wound up in what fiscal experts call ‘service insolvency,’ that is, it didn’t have enough money left over to spend on basic municipal services.”