Chicago Credit Rating Now Lower Than Any Major City Except Detroit

Daniel Greenfield, a Shillman Journalism Fellow at the Freedom Center, is a New York writer focusing on radical Islam. He is completing a book on the international challenges America faces in the 21st century.


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America is now run by the best and brightest of Chicago. What they did to Chicago, they’re doing to America.

Moody’s Investors Service has downgraded Chicago’s credit rating, citing the city’s unfunded pension liabilities.

The agency announced Tuesday it’s lowering the rating on $8.3 billion in debt from A3 to Baa1, putting it only three notches above junk-bond status.

Moody’s Investor Service rated the city’s upcoming $388 million bond issuance at Baa1, down from A3, a level set last year after an unusual triple downgrade.

Chicago will test the bond market for the first time since its bond rating dropped three notches, thanks to $1.9 billion in borrowings added Monday to the mountain of debt piled on Chicago taxpayers.

The lower rating means the city will have to pay high interest rates.

Moody’s concluded Chicago has the highest level of unfunded pension debt “of any rated U.S. local government.”

Chicago is home to one of the most troubled pension systems in the country. In total, the city’s four pension funds — for firefighters, police officers, and two for other city workers — face funding holes of nearly $20 billion.

uesday’s downgrades affect $8.3 billion in city debt, including $7.8 billion in general obligation bonds and $556 million in sales tax bonds. It follows previous downgrades by Moody’s and other ratings agencies.
It also comes as the city prepares to issue hundreds of millions in new bonds, according to Moody’s.

The latest hit to the city’s general obligation and sales tax ratings puts that debt only a few notches away from junk status. Moody’s said its outlook remains negative, which means additional downgrades could come.

Chief Financial Officer Lois Scott was asked Monday how much the downgrade would add to the city’s borrowing costs.

“We haven’t issued debt since then. So, we have no way of knowing,” Scott said before hustling out of the City Council chambers.

Chicago now has the worst credit rating of any major city except Detroit.

Don’t worry, Detroit, Chicago will get there soon. So will large chunks of California and New York City. And then they’ll have to annex the suburbs, seize 401Ks and start selling office furniture on eBay.

  • cxt

    Really does not surprise me….this is what happens when pretty much anything is run by Leftist. Since they insist that their ideology trumps reality they have really hard time making reality conform……its impossible of course……reality trumps ideology……but try telling them that.
    What does surprise me though is that despite repeated, catastrophic, failures–such as Detroit…..people still vote for and support Leftist plans and pols.
    It surprises me that they never learn.

    • Bigearsbarry

      People have to WANT to learn. Some are not there yet.

    • CapitalistPig

      it’s the appeal to emotion over intellect. Emoting is far easier than thinking. Throw in the fact that increasingly, our society offers more & more opportunity to vote money from one citizens pocket into another through wealth transfer & we have created a witches brew of ugly incentives.
      Why work for a living when I can vote for a living?.

  • flyingtiger

    Odd that the local news media never mentions this. Then again, their job is to protect the local dems.The solution for Chicagoans? Vote straight Republican

    • Chris Behme

      There’s dumb, and then there’s democrat dumb.
      These people will pull the D lever until their city is in the same shape as Detroit, or Beirut, or Zimbabwe.
      And they’ll blame republicans.

      • CapitalistPig

        Honestly, if you read liberals commenting on Detroit, it’s astounding how many of them blame the GOP. Mostly Democrat governors, all Democrat mayors & city officials–all of them beholden to the unions………& yep, it’s that dam GOP that ruined Detroit! You know, business should have just calmly relaxed & taken it in the shorts & allowed those constituencies to just strip them bare.
        Let fry in their own fat,

  • truebearing

    Chicago is trailing Detroit’s horrible credit rating? Give it time. They’ll catch up.

  • Chris Behme

    “Wastin’ away in obamaville,
    Looking for my lost EBT card”

    With apologies to J. Buffett.

  • DB1954

    lovebirds.

  • earl hickey

    that’s Chicago, always the second city. even when it comes to being the worst, there is still someone in front of us.

  • Tiberius

    Could not have happened to a better city. I hate to glee but I in a way hope it does happen. Yet on the other hand, I doubt the stupid people that voted for these politicians will even acknowledge this problem. They will blame Wall Street and the GOP and ask the Federal government to provide moeny.

  • Black Racism

    Community organizers love love love bankrupting a community (and now he gets to ruin a national economy for the first time – the enemedia should be so happy)

  • obamathemarxist

    That’s the gayest photo of the two of them I’ve seen.

  • Bigearsbarry

    Gee, not with Rahm running that great city.. What could of happened??

    sarcfont=OFF

  • ventures1

    Obama’s so-o-o-o very pleased! A big wet kiss comin’ yer way Rahmmy-poo!

  • PattyWise

    When does MIRA become your IRA? Looks like the “vehicle” MYRA has all been set up and ready to go. And I’ll suppose the “courts” will protect us like they did the G.M. bond holder Right?

  • Amichai

    I absolutely savor this kind of news. Let the liberal cesspools rot. This is especially funny for me as I’m an IT professional living in the South who gets several calls a week from recruiters trying to fill positions in Chicago, Detroit, New York or California. I tell them all the same thing – there’s no way I’d ever move there, no matter how much they’re offering.