Instructive Disinformation

The Institute

The Institute’s newest report, “Playing Favorites”, has created a firestorm of protest from union leaders, the Teachers’ Retirement System (TRS), pundits and local school officials.

I guess the truth hurts.

ABC-7 Chicago reporter Chuck Goudie broke news of our report Wednesday night. You can see Goudie’s coverage from Wednesday night here.

After Goudie’s story aired, the unions and their allies – including the press arm of the TRS – launched an all-out counterattack. In a memo to teachers, the head of the Illinois Education Association described their efforts to keep our report out of the news and intimidate those who covered it:

• “We will continue to try to reach Goudie and his managers.”
• “The labor coalition sent a message to all Illinois news outlets on Thursday warning them …they should be checking with the unions representing impacted employees if they’re considering stories on pensions.”
• “…the coalition made Rich Miller at Capitol Fax aware of the IPI report on which the TV story was based. Miller understands issues better than most reporters and he posted an outstanding knockdown of the report.”
• “We are monitoring all coverage and considering other possibilities for impacting news organizations.”

Meanwhile, the TRS reached out to ABC-7 and asked for rebuttal time. Goudie did a follow up Thursday night in which TRS’ spokesman shared “his side of the story.” To ABC-7’s credit, I was given a chance to respond to their criticism. You can see round two here.

On the air Thursday, TRS conceded that our report tells the truth which they and others tried to deny: teachers in two-thirds of school districts outside of Chicago pay little to nothing toward their own retirement. Instead, local school districts pick up some or all of the teachers’ employee contribution to their own retirement. (Chicago Public Schools picks up 7 percent out of the 9 percent employee contribution.) This pension pick up by local districts is a negotiated perk that is a sweet deal for teachers – the state pays the employer share and your local districts pays the teacher’s share!

Our report called for the state to end the practice of paying the “employer share” of pension contributions for teachers. This responsibility belongs with local school districts. Ending this practice would create local accountability, relieve the state of this financial burden, level the playing field between wealthy and poor school districts and, most importantly, put costs where they belong – on the ones who hire teachers, and negotiate the contracts and salaries that drive pension costs.

Local pension accountability may seem controversial to some, but it actually would align education with the rest of government. Only for educators does the state pay the employer share on behalf of another unit of government. This practice must stop.

When this so called “pension push down” was initially proposed, local school officials claimed the cost would require layoffs, shutting down extracurricular activities and or automatic property tax increases. News stories warning of this doomsday scenario abounded.

Just one problem – no one checked the numbers. So we did. And we found the state’s own data to be quite revealing.

On average, costs would increase by 3.7 percent – hardly catastrophic. But there is even better news – we came up with a way for this reform to result in savings for 482 of 866 school districts: stop the pension pick up practice by local school districts of the employee share (see above!). If this were done, 482 of the districts would save money. Most remaining districts would see cost increases of just one to four percent.

The big lesson for us is that advocates for the status quo will misrepresent our work to protect their financial interest. But nevertheless, we must be relentless in telling the truth. We’ve known this all along, of course, but the degree of disinformation, of press intimidation and cooperation between government, union officials and pundits and others is one of many reasons why reform is so hard. Just agreeing on the truth is a challenge for some.

This is Illinois, so we shouldn’t be too surprised. But kudos to ABC-7 for telling the story from all sides.