Chicago bonds

Dear Mr. Berko: I’m an 86-year-old retired steelworker. I am in good health and receive substantial retirement benefits. I’ve put three kids through college and been married for 62 years, and I’m proud to be an American. Our stockbroker has asked us whether we want to earn a safe 6.5-7 percent by buying pension bonds from the city of Chicago that will be issued soon. The bonds are not rated, but they’re taxable and guaranteed by the city. I know Chicago is in trouble, but in 1976, I bought some New York City bonds that did well.
— WH, Moline, Ill.

Dear WH: Wow! You certainly retired before the fit hit the shan. Congratulations on 62 years of marriage and putting three kids through college.

Before answering your question, I must comment on the new Medicare cards, which millions of Americans across the country have received via mail. Washington has been slowly replacing Medicare cards for the 61 million Americans and non-Americans covered by the federal health plan. At the same time, Washington is attempting to warn naive and unsophisticated cardholders (often the elderly) of the numerous grifters who’re trying to confuse new cardholders into divulging personal information. Probably a dozen readers during the past two months have written about the calls they’ve received.

Last week, a longtime reader who received her new card emailed to tell me that she had received a phone call from someone supposedly with the Social Security Administration. The caller’s voice was as comforting as warm milk and chocolate cookies. After introducing himself, he said the SSA was verifying Medicare accuracy by comparing people’s Social Security numbers with the 11 numbers on their new Medicare cards. He gently asked her to pull out both cards. Then he asked her for the first three numbers on her Social Security card. At that point, she wised up and ended the call. But these scammers know that the first three numbers on your Social Security card indicate the city in which you were born. For example, numbers beginning with 766 through 772 were issued in Florida. After you give them the first three numbers, they’ll tell you where you were born. And when you surprisingly answer that they’re right, they’ll ask you for the number on your new card and then respond with apparent alarm, “Could you please give me your full Social Security number and address?” And then, in a voice oozing with sincerity, they’ll say that “everything is in apple-pie order,” profusely apologize and thank you for your time. There are many ways to skin a cat, and they all hurt.

Please report any suspicions to your local SSA office or call 800-MEDICARE. And be mindful that Medicare never calls a private number unless specifically asked to do so. If you get a call supposedly from Medicare, jot down the name of the person who called and the phone number. Then call your local Medicare office.

In the 1700s, we tarred and feathered grifters. Today they’re taken to court and released on their own recognizance. What a shame!

The city of Chicago says it’s $28 billion behind the eight ball in its pension obligations, though I’m told that the real amount is closer to $35 billion. There are too many blockheads running the Windy City. And these imbeciles would have Chicago issue a $10 billion bond paying 7 percent while the thugs who run the pension plan tell the city they will earn 9 percent. The difference between what is questionably earned (9 percent) and what is paid out (7 percent) is 2 percent, or $200 million, annually. And this $200 million difference would be added to the assets of the pension plan annually. The state of Illinois tried a similar tactic 16 years ago, issuing a $10 billion bond, but it fell flat on its duff. Since 1983, over 400 municipalities have tried, and most have failed egregiously. So, the morons who manage Chicago reflect my definition of gross stupidity: doing something over and over again while expecting different results. Some believe that the villains who hired the thugs to run Chicago’s pension are receiving pork under the hat. If I were an Illinois politician, I wouldn’t be ashamed to admit it. Meanwhile, Las Vegas is a better bet.

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Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775, or email him at mjberko@yahoo. com. To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www. creators. com.
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