Updated: October 3, 2013 6:11AM
Last March, the president of the influential Civic Committee of the Commercial Club of Chicago, which is heavily populated with top corporate executives, told how he and some members of his group had tried to browbeat the New York credit rating agencies into lowering Illinois’ ratings.
The state’s ratings had not yet plummeted to where they are now, so the idea was to use rating cuts to put pressure on Illinois legislators to enact a tough pension reform law to sharply reduce benefits for current and future state employees.
There were a “couple” of interactions on the phone with the rating firms and “in one case it was in person,” Tyrone Fahner told his audience at the Union League Club in Chicago.
“How in the hell can you guys do this?” Fahner summed up the gist of the argument that was made to the New York agencies. “You’re an enabler to let the state continue.”
Fahner also appeared to take some credit for the rating downgrades, “but if you watch what happened over the last few years, it’s been steadily down. Before that, it’s been the blind eye,” he told his audience.
But then, after I’d written about his speech in the Sun-Times and on my capitolfax.com website, Fahner wrote me to say that he made it all up.
“You gotta be kidding me,” was my initial reaction after I read his email to me. That was a pretty darned complicated story to just invent on the fly.
“I misspoke,” Fahner wrote. “I didn’t call the ratings agencies nor did any of our Civic Committee staff.”
He later clarified that he knew of nobody at the Civic Committee who had ever “contacted the rating agencies to urge Illinois be downgraded or for any other reason.”
Yep. It was all just a fantasy — kinda like that time on the TV show “Dallas” when Patrick Duffy’s character Bobby Ewing was killed off and then Duffy decided later that he wanted to return to the show, so the producers announced that the entire season had been a bad dream by Pamela Ewing, Bobby’s wife.
I’m not sure if Fahner is Bobby Ewing or Pamela, but his comments had definitely become a nightmare.
Fahner’s law firm has a contract worth as much as $2 million to, irony of all ironies, handle the state of Illinois’ bond work.
So, if Fahner was telling the truth in March, he was boasting about advocating against one of his firm’s big clients.
Also, the chairman of Fahner’s law firm is a Civic Committee member. Not to mention that many of the big financial chief execs who are Civic Committee members run companies that do lots of Illinois bond business.
Fahner is no average Joe. He is a former Illinois attorney general. The Civic Committee he runs is loaded with corporate titans. The guy has political clout.
A pension reform bill that Fahner wholeheartedly supported could’ve passed months ago, but Fahner refused to agree to a compromise.
Senate President John Cullerton (D-Chicago) offered to construct a bill that would allow Fahner’s more drastic pension reforms to take effect — with the understanding that if the courts struck down the language as unconstitutional, Cullerton’s rival reform proposal would kick in.
In perhaps the most frustrating moment during the three long years of agonizing pension reform battles in the General Assembly, Fahner’s opposition to Cullerton’s offer pulled Senate Republicans off the bill, which doomed it.
And here we sit today with still no pension reform. But that ongoing failure caused the state’s credit rating to be lowered further in June to just three levels above junk bond status.
Thanks, Ty. Pleasant dreams.
Rich Miller also publishes Capitol Fax, a daily political newsletter, and capitolfax.com.