Illinois Bet the Farm and Lost—You'll Never Guess Who They Want to Pay the Tab

Illinois is facing a fiscal crisis that would see normal businesses shutting their doors and packing up the U-Haul. But states are an entirely different matter. They're not allowed to declare bankruptcy.

Pensions, which a judge ordered must be paid by Illinois, now amount to 100 percent of the state's revenue. Moreover, those pension funds are invested in the stock market and cannot be paid without a guaranteed five to seven percent return --- which is nearly impossible. So lawmakers have come up with a new plan to solve the problem created by an overburdened, overreaching government: tax the rich.

"This is an actual proposal now. They want to tax the rich, but in particular, they are mad at the people who are making so much money on the stock market. So what they're going to do, in Illinois, they are now proposing a 'small' tax of 20 percent," Glenn explained Thursday on radio.

The other proposal on the table is to break up the state and have it absorbed by the surrounding states.

"How many people in Missouri want to now be responsible for East St. Louis?" Glenn asked.

Thanks, but no thanks, Illinois.

GLENN: Hello, America.

Back in -- when I was at Fox, I did a segment on pensions and how pensions were working for fire firefighters and police and everything else. And if you remember, it was like four or five -- when pensions first started, it was like four or five workers would support the firefighter that left. Remember?

The problem is, is that the pyramid has been turned upside down. Now, what's happening, is one person is trying to take care of three or four pensioners. And there's absolutely no way to cover it. The math doesn't work. The pyramid is upside down. And it's a pyramid scheme.

So what did they do? The -- the unions decided that they would take all of the money that was supposed to go to pensions and they would put it into the stock market. And they had to get a return of five to 7 percent a year to be able to cover -- what they said, cover all of the pensions. It still didn't work.

Stu, you're wise enough to -- on money investment. How -- how difficult is it to get a guaranteed return of five to 7 percent a year?

STU: There's actually no such thing as a guaranteed return, in this particular climate, of five to 7 percent a year.

GLENN: Right.

STU: I mean, if it's in the stock market, it's obviously never guaranteed.

GLENN: Right. And in the stock market, or any investment, say I need 7 percent or I collapse every year. Is that something you should put together?

STU: That's a horrific idea.

GLENN: Horrific idea. There's no -- there's nobody in --

PAT: You might get that some years.

GLENN: Correct.

PAT: You might even do better than that some years.

STU: Oh, yeah. And you will.

PAT: But it's almost a guarantee you won't get it every year.

GLENN: So because the pension is upside down, the pyramid pension is upside down, now you have one person paying for three people, it doesn't work. And the stock market has been up and down. You never know if you're going to get five to 7 percent. But if you put your money in, in 2008, when the stock market was, what? At about 8,000.

STU: It was in the 6800 range --

GLENN: Yeah, might have been 6800.

Okay. Today, the stock market is at 21,000.

STU: Right.

GLENN: So you got a pretty good return on your money, don't you think?

PAT: Yeah. Tripled it.

GLENN: Yeah. You put your money into the teacher's union and the teacher's union is invested in stocks, that's fantastic. You went from 6800 went to 21,000. That's probably the best run of the stock market in history.

We were at an all-time high of 21,000. Illinois now has 100 percent of every tax dollar coming in, going out to pay for the pensions. 100 percent of every tax dollar, which means nothing for schools, nothing for roads, nothing for infrastructure, nothing to pay the mayor, nothing but graft now for city council. Nothing. 100 percent.

And a judge has said, "You cannot reduce any of the pensions. They must -- the state of Illinois must pay 100 percent of those pensions," which is now taking 100 percent of every tax dollar to pay.

So now they're saying, "We're going to break Illinois up." One suggestion is we're going to break Illinois up into five separate states and give portions of the state of Illinois. So congratulations, St. Louis, you're going to get east St. Louis as well. And you just to have take care of that.

Or is it -- it's east St. Louis, isn't it? Across the border? Yeah. Congratulations. How many people in Missouri want to now be responsible for east St. Louis?

But congratulations. You might get that. And, you know, it will now be part of your state. Congratulations.

No, thank you. And you can pay for all the pensions and everything there. Well, that's not going to work. The states aren't going to do it. Because every state is in this condition.

So --

PAT: Except for Texas.

GLENN: Except for Texas. Be careful.

Now, what are they talking about -- besides -- they're not going to break the state up. So besides that, what is the state of Illinois suggesting that they do?

The state has a great idea. They say that the wealthy are getting rich off of the stock market. Now, let's remember that the pensions are all in the stock market. So it's not just the wealthy that are getting rich on the stock market. It's the people who have their money in 401(k)s, IRAs, and in pension funds. They're getting rich on the stock market. Or they're at least getting partially paid because of the stock market being run up. So what is Illinois' plan?

Oh, I'll show you next. And show you how this works out, a little like what's happening in London, when we come back.

GLENN: All right. Let me just -- let me just take you through this real quick, and then we're going to get to what lessons did the Democrats learn and where is the world headed.

The problem in Illinois is going to hit every -- is going to hit every state. And it's going to hit every state differently. The pensions -- and we're talked about the fire, the police, all -- all state workers -- the pensions are out of control and have been for a long time. And back in 2008 or 2009, as I outlined, if we don't take care of these problems now, we are going to be facing massive issues in the future and there will be no good outcome. The outcome will be, dump it into the lap of the federal government. That's what I said at the time, 2008, 2009, if you remember that episode.

Well, we're here now. And Illinois, which is the state that I used as the example, is the first one to start to collapse. They have -- the money that they owe people in pensions is going to take 100 percent of the budget, and the state has said that they have to have -- they have to pay these pensions. So that's 100 percent of the budget.

The pensions are invested in the stock market. And for them to pay the pensions -- this is what they claimed -- they needed a five to 7 percent guaranteed return on their money. Well, that's impossible. I mean, that's -- you know, I know the Bernie Madoff. But it's on the road to Bernie Madoff. Nobody can promise you five to seven. But you had to have five to 7 percent in pensions because they wouldn't reduce the pensions they promised everybody. And we all accepted it. And the politicians were too greedy to say these unions are lying to you. You're never going to be able to retire because this is -- this is nothing but a Ponzi scheme.

All right. They're not getting enough of the return. They're not able to be able to make the money when the stock market is at 21,000. The highest ever. And they still can't make these pensions work.

It's not like, we had a crash, and it was unexpected. No, no, no. Highest stock market ever. And it's still not enough.

What happens if we have a correction and it falls to 15,000? What happens if -- let's be crazy and say another, you know, 2008 happens and it falls down to 16800. Or another Great Depression happens.

Well, what happens to then the Illinois pension fund, which is now taking 100 percent of the budget? Is it 200 percent of the budget?

So Illinois has bankruptcy. No, that's not going to work. Because a state can't declare bankruptcy. They can break the state apart. That's not going to happen.

So they're left with taxes. Let's take more from the poor, right? Isn't it the poor?

No. No. Sorry. They want to tax the rich.

Now, who are they taxing? Who are they going to tax? This is an actual proposal now. They want to tax the rich, but in particular, they are mad at the people who are making so much money on the stock market.

So what they're going to do, in Illinois, they are now proposing a small tax of 20 percent.

PAT: Oh, my gosh. On --

GLENN: On transactions in the stock market. Okay.

PAT: Good golly.

STU: What?

GLENN: 20 percent tax over a certain amount for the uber rich.

Well, Stu, you're investing money in the stock market, and Illinois sets a trap up to take 20 percent of your money. What do you do?

STU: Putting my money somewhere else, because even if I'm successful, I lose under this proposal.

GLENN: Correct. If I get a 7 percent return on my money and I want to move my money, I lose an additional 13 percent. I lose the 13 percent -- I'm sorry. No, no, no, wait. I lose -- yeah, 13 percent. Because I've made seven, but they're taking 20. So I've lost 13 percent of my money, even though I gained.

STU: So then, of course, these wealthy individuals do not invest in the stock market. And what happens to the stock market when they don't invest in it?

GLENN: What? What are you talking about?

STU: Yeah, it doesn't stay up. If you start taking millionaires or billionaires out of the stock market, that doesn't help.

GLENN: Yeah. Or because you are taxing the people of Illinois, something else happens too.

STU: People move the hell out of the state.

GLENN: Yes. There we go. They move. They take their crap and they leave Illinois.

STU: Now, that helps the pension funding, right?

GLENN: No.

STU: Because not having those people there -- they're so bad for the economy, those rich people.

GLENN: No. No. No.

So now they're gone.

PAT: Jeez.

JEFFY: Well, we've got to do something about that. We've got to make it so that they can't move.

GLENN: Right. Right. So now there's two problems: That's not going to work. It will only make things worse. And then the state will say, we've got to make it so people can't move.

This is going to be -- there's another problem that is going on. So the state will have to move it up to the federal government because the federal government will be the only one that could be the backstop. Because Illinois is too big to fail. There's another problem.

If I have my pension in the firefighters union or the police union and I'm already seeing in places like Dallas that there's no way I'm going to get my pension, it's starting to collapse in a healthy city, like Dallas. I'm going to do, what? I'm going to ask for my cash payout. I'll take less to get my money now.

So once they start to see what's really happening in Illinois and they realize, this whole thing is going to collapse, all of the people who have pensions are now going to say, "I'm getting my money out now." And that's -- what happens -- what do we call that when it happens to banks?

PAT: Run on the bank.

GLENN: Run on the bank. So what do they do? They usually close the bank so you can't do a run on the bank. And then they tell you, you can only take out a certain amount. So now you don't have a choice anymore.

The federal government will tell you, you can't take the pension money. You can't take a lump sum anymore because it will cause a run on the pensions. So when this happens and you have the stock market -- let's say the stock market crashes and the extra taxes on the rich don't work and then people start to lose their job and lose their money in their 401(k) and you don't have a pension, the federal government is going to bail you out. By putting that much money -- by printing that much money, what happens then again to our money? Because now we're printing millions and billions of dollars, that is going to have velocity.

The current riots and movement to erase America's history are exactly in line with the New York Times' "1619 Project," which argues that America was rotten at its beginning, and that slavery and systemic racism are the roots of everything from capitalism to our lack of universal health care.

On this week's Wednesday night special, Glenn Beck exposed the true intent of the "1619 Project" and its creator, who justifies remaking America into a Marxist society. This clever lie is disguised as history, and it has already infiltrated our schools.

"The '1619 Project' desperately wants to pass itself off as legitimate history, but it totally kneecaps itself by ignoring so much of the American story. There's no mention of any black Americans who succeeded in spite of slavery, due to the free market capitalist system. In the 1619 Project's effort to take down America, black success stories are not allowed. Because they don't fit with the narrative. The role of white Americans in abolishing slavery doesn't fit the narrative either," Glenn said.

"The agenda is not ultimately about history," he added. "It's just yet another vehicle in the fleet now driven by elites in America toward socialism."

Watch a preview of the full episode below:


Watch the full episode only on BlazeTV. Not a subscriber? Use promo code GLENN to get $10 off your BlazeTV subscription or start your 30-day free trial today.

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.

Acclaimed environmentalist and author of "Apocalypse Never" Michael Shellenberger joined Glenn Beck on the radio program Wednesday to warn us about the true goals and effects of climate alarmism: It's become a "secular religion" that lowers standards of living in developed countries, holds developing countries back, and has environmental progress "exactly wrong."

Michael is a Time "Hero of the Environment," Green Book Award winner, and the founder and president of Environmental Progress. He has been called a "environmental guru," "climate guru," "North America's leading public intellectual on clean energy," and "high priest" of the environmental humanist movement for his writings and TED talks, which have been viewed more than 5 million times. But when Michael penned a stunning article in Forbes saying, "On Behalf of Environmentalists, I Apologize for the Climate Scare", the article was pulled just a few hours later. (Read more here.)

On the show, Micheal talked about how environmental alarmism has overtaken scientific fact, leading to a number of unfortunate consequences. He said one of the problems is that rich nations are blocking poor nations from being able to industrialize. Instead, they are seeking to make poverty sustainable, rather than to make poverty history.

"As a cultural anthropologist, I've been traveling to poorer countries and interviewing small farmers for over 30 years. And, obviously there are a lot of causes why countries are poor, but there's no reason we should be helping them to stay poor," Michael said. "A few years ago, there was a movement to make poverty history ... [but] it got taken over by the climate alarmist movement, which has been focused on depriving poor countries, not just of fossil fuels they need to develop, but also the large hydroelectric dams."

He offered the example of the Congo, one of the poorest countries in the world. The Congo has been denied the resources needed to build large hydroelectric dams, which are absolutely essential to pull people out of poverty. And one of the main groups preventing poor countries from the gaining financing they need to to build dams is based in Berkeley, California — a city that gets its electricity from hydroelectric dams.

"It's just unconscionable ... there are major groups, including the Sierra Club, that support efforts to deprive poor countries of energy. And, honestly, they've taken over the World Bank [which] used to fund the basics of development: roads, electricity, sewage systems, flood control, dams," Micheal said.

"Environmentalism, apocalyptic environmentalism in particular, has become the dominant religion of supposedly secular people in the West. So, you know, it's people at the United Nations. It's people that are in very powerful positions who are trying to impose 'nature's order' on societies," he continued. "And, of course, the problem is that nobody can figure out what nature is, and what it's not. That's not a particular good basis for organizing your economy."

Watch the video below to catch more of the conversation:

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.

Dr. Voddie Baucham, Dean of Theology at African Christian University in Lusaka, Zambia, joined Glenn Beck on the radio program to explain why he agrees with Vice President Mike Pence's refusal to say the phrase "Black Lives Matter."

Baucham, who recently drew national attention when his sermon titled "Ethnic Gnosticism" resurfaced online, said the phrase has been trademarked by a dangerous, violent, Marxist movement that doesn't care about black lives except to use them as political pawns.

"We have to separate this movement from the issues," Baucham warned. "I know that [Black Lives Matter] is a phrase that is part of an organization. It is a trademark phrase. And it's a phrase designed to use black people.

"That phrase dehumanizes black people, because it makes them pawns in a game that has nothing whatsoever to do with black people and their dignity. And has everything to do with a divisive agenda that is bigger than black people. That's why I'm not going to use that phrase, because I love black people. I love being black."

Baucham warned that Black Lives Matter -- a radical Marxist movement -- is using black people and communities to push a dangerous and divisive narrative. He encouraged Americans to educate themselves on the organization's agenda and belief statement.

"This movement is dangerous. This movement is vicious. And this movement uses black people," he emphasized. "And so if I'm really concerned about issues in the black community -- and I am -- then I have to refuse, and I have to repudiate that organization. Because they stand against that for which I am advocating."

Watch the video below to catch more of the conversation:

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.

We're going to be doing an amazing broadcast on Thursday, July 2nd, and we will be broadcasting a really important moment. It is restoring truth. It is restoring our history. It is asking to you make a covenant with God. The covenant that was made by the Pilgrims. And it's giving you a road map of things that we can do, to be able to come back home, together.

All of us.

And it's never been more important. Join us live from the Standing Rock Ranch on Blaze TV, YouTube and Facebook at 8:00 p.m. Eastern time on Thursday July, 2nd and restore the hope in you.

Make sure you join us and use the hashtag and spread the word, fight the mob today and you'll save $20 on your year of subscription. We need you now more than ever.

RESTORING HOPE: Join Glenn live from Standing Rock Ranch to restore the American covenant youtu.be