Groucho Marx once observed: "Politics is the art of looking for trouble, finding it, misdiagnosing it, and then misapplying the wrong remedies."
Politicians in Illinois
don't have to look very far to find trouble:
- The
National Conference of State Legislatures released a report in July 2010
declaring llinois' financial situation to be the worst in the nation.
- Illinois'
budget deficit stands at $43.8 billion and has more than doubled in the
last five years. (Auditor General report, 6/21/12)
- Illinois
has unpaid bills totaling about $8.5 billion. (The News Gazette, 06/20/2012 )
- Illinois has the largest unfunded pension obligations in the nation with unfunded liabilities totaling $84.2 billion in fiscal year 2012 (SURS, 2011)
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Illinois
politicians have diagnosed the problem: The state is spending too much. To
remedy this, they are closing facilities, laying off workers, eliminating
programs, screwing retirees and slashing budgets.
Is their diagnosis
correct? Is Illinois really
spending too much? Let's look at some facts collected by The Center for Tax and Budget
Accountability :
- Even
though Illinois ranks 13th
in per capita Gross Domestic Product among the states, it ranks 43rd
in spending on public services.
- "[Illinois] has been cutting real spending on
all four categories of core public services for over a decade and ranks
well below the national average in critical Education and Human Service
spending both in per-capita and capacity terms."-- April 2012
- In 2006, Illinois ranked 50th in state funding of
education.
- A study by Associated Press (6/30/12) found that Illinois has the smallest number of state workers per 1,000 residents of any state in the union. (The study excluded education employees.)
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According to the Center for Tax and Budget
Accountability (CTBA) , Illinois
does not have a spending problem; it has a revenue problem. Illinois'
tax system does not even generate enough revenue to maintain public services at
the same level from year to year--let alone improve anything.
This is not some
temporary problem brought on by the recession.
- "In 2005, when other states were doing
well, Illinois was one of only three states to
finish the budget year with a deficit."--Rockford
Register Star, 7/7/12
Illinois Politicians have
done nothing to improve the situation. In fact, they continue to make it worse:
- "The state hasn't had a balanced
budget since 2001. It papered over its budget problems by stringing out
payments to doctors, pharmacists, schools and local governments. It
diverted money designated for special purposes to pay for general
operations. It borrowed money to cover its annual pension payments."--Daniel
C. Vock, Staff Writer, Pew Center on the States, 5/19/11
- "A cuts-only approach to state budget
deficits is shortsighted--imposing immediate harm on families, while
dampening economic recovery and compromising the future competitiveness of
the American workforce."--United for a Fair Economy, 5/25/11
- "Illinois has consistently cut payments to the private sector, nonprofit companies that provide the vast majority of direct human services in Illinois. This is the worst strategy during a recession, as it both reduces access to services when the need for them is greatest, and forces cutbacks and closures among nonprofit private businesses, further shrinking the Illinois economy and exacerbating overall unemployment in Illinois."-- Ron Baiman, CTBA, 2/24/10
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The Center for Tax and Budget
Accountability (CTBA) is a bi-partisan think tank created to promote fair and efficient
tax, spending and economic policies in Illinois. It does so by analyzing Illinois ' fiscal problems with the goal
of finding solutions which will ensure that essential state services are properly
funded and the state's tax system is fair to all Illinoisans.
One would hope the politicians in Springfield, Illinois would use the same kind of
careful analysis with the same lofty goals as the CTBA, but that doesn't seem
to be the case. This may be because the staff at CTBA is comprised of experts
in research and analysis of economic and fiscal policy; while most politicians'
only qualification for dealing with complex economic matters is that they won
an election.
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While there are several
things the state could do to increase tax revenues, the CTBA states:
- "[T]here is one long-term, structural
policy change that would simultaneously stimulate job growth in the state,
tax people more fairly and reduce Illinois' General Fund deficits: creating
a graduated rate structure for the Illinois individual income tax."
The poorest 20
percent of Illinois households
pay 13 percent of their income in combined income, property, and sales taxes. Those
in the top 20 percent pay only 6.2 percent, and the richest one percent pays only
4.1 percent of their income. Does that sound fair?
- "The current Illinois tax system is the opposite of fair, because it places the greatest burden on low and middle income families. Indeed Illinois presently has the third highest tax burden for low income families of all 50 states."--CTBA Fact Sheet, March 2012
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