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Chicago mayor's pension fix: raise taxes, cut benefits - (www.cnbc.com) Chicago Mayor Rahm Emanuel proposed raising property taxes and reducing retirement benefits for some city workers in order to ease a severe pension funding problem, according to details of the plan released by his office on Tuesday. Under the plan, the city would collect $250 million more in property taxes over five years while workers' current 8.5 percent contributions to the city's municipal and laborers retirement systems would rise an additional 2.5 percent over five years. Annual 3 percent compounded cost-of-living pension increases would also be tied to inflation and skipped in certain years. In addition, the city would tap separate funds for its airports and utilities to cover pension funding increases for workers in those departments. Chicago warned that the two systems face insolvency within nine to 17 years. The funding shortfall is $8.4 billion for the municipal system and $1 billion for the laborers system, according to city documents. A coalition of public labor unions, We Are One Chicago, blasted the plan as unfair to current and retired workers.
Maryland
Drops $125M Obamacare Exchange Site - (www.cbn.com) Maryland
has decided to abandon its expensive state-run health care website, which was
created to comply with Obamacare. The Washington Post reports the site,
which cost Maryland taxpayers more than $125 million, is "broken beyond
repair." State officials are reportedly going to use technology used to
run Connecticut's healthcare website instead. Other states like Oregon,
Minnesota, and Hawaii have experienced major problems with their healthcare
exchanges as well.
François
Hollande poised to react to election blow
- (www.cnbc.com) French President François Hollande is expected
to launch a rapid shake-up of his Socialist government following a second
defeat in local elections on Sunday, with big gains for the main opposition UMP
party and far-right National Front. But in a relief for the two main parties,
the FN fell short of the scale of victory it had hoped for after making a big
breakthrough in the first round of voting last Sunday. The main winner of the
night was the centre-right UMP, party of former president Nicolas Sarkozy. It
was set to gain more than 100 municipalities, capturing a majority of larger
towns from the ruling party, including Toulouse, Reims, Angers and St Etienne. According
to one exit poll, the UMP and its allies won 49 per cent of the vote in all
towns larger than 3,500 inhabitants, against 42 per cent for the Socialists and
other parties of the left, and 9 per cent for the FN.
China
Burns Speculators as $5.5 Billion Lost on Yuan Bets - (www.bloomberg.com) China is succeeding in making its currency less
predictable. Investors are paying the price. Clients of U.S. commercial banks
have lost about $2 billion this year on $332 billion of options betting the yuan would
appreciate, while Chinese companies lost $3.5 billion on $150 billion wagered
on a benchmark forwards contract, according to data compiled by Morgan Stanley
and the Depository Trust & Clearing Corp. in Washington.
These contracts, when including bearish bets, account for more than a third of
global trading in the Chinese currency. After almost a decade of gains,
speculators had come to regard the yuan as a one-way trade, leading to a surge
incapital inflows that stands to leave
the country vulnerable to a sudden shift in investor sentiment. Policy makers
responded by selling the yuan and widening its trading band, encouraging a
record 2.4 percent quarterly decline that was the biggest among Asian
currencies.
Yellen’s
Real-Life Examples of Unemployed Omit Criminal Records - (www.bloomberg.com) In her first speech as Federal Reserve chair, Janet
Yellen told the stories of three people who had trouble finding
work to illustrate her concern about the unemployed -- omitting the fact that
two had criminal records that might have influenced employers’ decisions on
whether to hire them. One was Dorine Poole, who lost her job processing medical
insurance claims when the recession hit. “When employers started hiring again,
two years of unemployment became a disqualification,” Yellen said in her speech
yesterday to a community development conference in Chicago. “Even those needing
her skills and employment preferred less-qualified workers without a long spell
of unemployment.” Poole was convicted of felony theft 20 years ago after she
fell in with a “bad circle,” she said in a telephone interview. She was 18 at
the time and served two years of probation. Jermaine Brownlee, a skilled
construction worker and apprentice plumber, “saw his wages drop sharply as he
scrambled for odd jobs and temporary work,” Yellen said. Brownlee said in a
telephone interview that he was convicted of possession of heroin last year and
currently is on parole.
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