Pritzker/Emanuel minion Beth Swanson did 'budget' Power Points at the time... Chicago Board of Education began planning 'Pension Crisis' six years ago to force CTPF into defined contributions

By the time George W. Bush was completing his second term, during which he failed to privatize Social Security, Chicago's plutocracy was already planning the "Pension Crisis" which is supposedly driving the cutbacks in Chicago's real public schools today. By a combination of refusing to add revenue for the school system, failing to plan for the pension costs that were clearly due, and relying on the short memories and failure to plan on behalf of most popular working class groups, including the unions, Chicago, under two mayors set the stage for 2013. The large payments due to the Chicago Teachers Pension Fund (CTPF) were clear as early as 2007 and 2008, when Barack Obama was still behind Hilary Clinton in the race to succeed George W. Bush and the world financial crisis caused by the real estate bubble and speculation in the USA was just beginning to show in the books of now-defunct corporate titans like Bear Stearns and Lehman Brothers.

During the 2008 CPS budget hearings, then budget director Beth Swanson provided those who attended the hearing's first day at Lane Technical High School with a Power Point that showed, luridly, that Chicago's pension obligations would increase over the next several years. But Swanson later stood with Mayor Richard M. Daley and then schools chief Arne Duncan while Daley announced, two months before the collapse of Lehman Brothers, that Duncan and others, under Daley, had done such a nifty job running Chicago's public schools that CPS didn't even need the minimal tax increase it was entitled to "going to the cap."

And as a result, a few months before federal, state and local revenues faced their biggest challenges in decades, CPS went into the 2008 - 2009 school year without the tax increase that would have added to the revenues at a modest rate.

By April 2010, Swanson was working for the Pritzker family, and Arne Duncan was working for President Barack Obama in Washington, D.C. as U.S. Secretary of Education. Duncan's replacement, an ex-cop named Ron Huberman who had proved that he could run the city's school system by having run the buses and trains of the Chicago Transit Authority, told the leaders of the Illinois General Assembly that Chicago's public schools would not be able to open in September 2010 unless CPS received a three-year $1.2 million "pension holiday" -- enabling CPS to avoid paying $400 million a year in money it clearly owed to the Chicago Teachers Pension Fund.

At the time, the Chicago Teachers Union leadership, under then President Marilyn Stewart, had neglected the basics of budget research and lobbying for so long that the "pension holiday" attack on the future solvency of the CTPF went largely unnoticed while it was rocketing its way through Springfield. Three months later, Stewart and her "United Progressive Caucus" were voted out of office by an irate CTU membership, and the pension time bomb was waiting in the future, another problem to be faced by Karen Lewis and the new leadership of the Chicago Teachers Union, elected under the CORE (Caucus Of Rank-and-file Educators) banner in a June 2010 runoff.

Huberman's pension holiday deprived the CTPF of necessary revenues in 2010, 2011, and 2012 and set the stage for the so-called "crisis" of 2013, a "crisis" which is being stage-managed by the media team surrounding Mayor Rahm Emanuel (who succeeded Daley in May 2011) and Barbara Byrd Bennett (the "Chief Executive Officer" of Chicago's public schools, who succeeded Jean-Claude Brizard, who succeeded Terry Mazany, who succeeded Huberman -- yes, there have been five CEOs at CPS in the past five years), the latest "Chief Executive Officer" for the nation's third largest school system.

And so while Rahm Emanuel tells the press that the "billion dollar deficit" supposedly facing the Chicago public schools is being driven, mostly, by the pension costs, somewhere near him is Beth Swanson, whose work at CPS, for the plutocracy while she served the Pritzker Traubert Family Fund, and now as the mayor's education liaison, is silently observing. But no reporter asks her why there wasn't some planning to help the pension fund reach 2013 without a "crisis."

And during the years since Rahm Emanuel was elected Mayor of Chicago, the refusal of the mayor to provide money for the city's real public schools has become notorious as millions of dollars have been taken from the public and put into private corporate hands, most dramatically this year with the mayor's announcement that Chicago will subsidize the creation of a new arena for the DePaul University basketball team in the McCormick Place area. And Chicago's teachers and retired teachers (among whom are this reporter) are told that future pensions will have to be cut, that current teachers will pay more for pensions and get less, and that teachers should really settlle for volatile 401-k type plans ("defined contribution" plans) rather than the defined benefit plan that had worked for Chicago teachers for more than 110 years.


July 6, 2013 at 9:38 AM

By: Rod Estvan

Totally correct on property tax issue

There is simply no question that George is correct on the impact of the failure of CPS to tax up to the property cap for a number of years. But as we all know there are even CPS employees who do not want such increases when the values of homes have declined by significant amounts.

The issues of CPS finances go far beyond the DePaul deal, it includes issues like our state's flat income tax where Mr Rauner is taxed at the same 5 percentnt a starting teacher is taxed at. But if Mr. Rauner lived in California his state income tax would be over 16 percent.

Rod Estvan

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