By Hal Dardick
A coalition of Chicago public sector unions resistant to a push by Mayor Rahm Emanuel for changes to the pension system released a report Monday that concluded that the city should focus on new or higher taxes instead of significant cuts to benefits.
The We Are One Chicago group contended that cutting pension benefits would send negative economic ripples through the city and suburbs where retired Chicago Public Schools and city workers live.
The impacts of pension benefit cuts would hit women and people of color in disproportionate numbers and in turn hurt the economies in the city’s African American communities, concluded the study, which was dubbed “The Great Chicago Pension Caper: Neighborhood Destabilization in an Age of Austerity.”
To prevent those negative consequences, the group proposed several ways to pump up to $2.4 billion more into city and CPS coffers each year. Among them: closing state corporate tax loopholes; replacing the state’s flat income tax with a graduated tax that would require people making more money to pay more; and expanding the sales tax to include services while lowering the overall rate. That sales-tax approach is similar to the so-called “Rahm” tax that Emanuel proposed during his 2011 campaign but that never went anywhere in the face of withering criticism.
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