Quinn’s Budget Address

by Dave Schuler on March 26, 2014

This afternoon I listened to Gov. Pat Quinn’s address on Illinois’s budget. I didn’t catch all of it but I caught most of it. If I had been expecting a green eyeshades-type speech, full of numbers and detail, I would have been disappointed. It was a stump speech.

Even as a stump speech it was a bit disappointing. I now know that Gov. Quinn is in favor of public education, infrastructure spending, and making the income tax hike of a few years ago permanent. I also know that he’s opposed to making services subject to the sales tax and Illinois’s excessive dependence on real estate tax. Beyond that there just wasn’t much there there.

Conspicuous by its absence was any mention of how much he wanted to spend (on anything) or how much revenue would be needed.

However, as Josh Billings (Henry Wheeler Shaw) said, it ain’t what you don’t know that’ll hurt you but what you do know that just ain’t so. The disinformation and misinformation in the governor’s speech was abundant.

For example, despite the governor’s frequent touting of Illinois’s pension reform most of the job is left to be done. An independent review of the pension reform measure found that its impact on Illinois’s public pension problem was negligible.

He also failed to mention that real estate taxes are the primary source of revenue for local governments and most of the real estate tax is securely in their hands (Illinois has more independently taxing institutions than any other state in the union). Whatever the state might do in this area will have practically no effectd. From the governor’s remarks you might conclude that education in Illinois was an accomplishment on which he could run proudly. The reality is that Illinois is last among the states in its contribution to public education. He emphasized how much Illinois had accomplished during his tenure in office while handily ignoring that the state’s credit rating had been lowered twice during that relatively brief tenure. There was nothing in his speech that would solve Chicago’s public pension problems, a significant portion of which has been fomented by the state, and one of the state’s most pressing problems.

Other than it it was a delightful speech, mostly serving to position the governor in his re-election campaign agaist Republican challenger Bruce Rauner.

{ 5 comments… read them below or add one }

PD Shaw March 26, 2014 at 3:24 pm

I didn’t know he would come out for continuing the income tax hike; I thought he would some third-way, amending the Constitution to allow progressive taxation and/or the millionaires tax. (Unspoken might be the need to continue the current hike until amendment) I think we need tax reform, and wouldn’t mind simply adopting the tax system of a neighboring state like Indiana, which includes progressive income taxation and taxation of services. But I think Quinn’s framing is problematic since this was supposed to be temporary and its very extension reflects back on promises unmet.

Dave Schuler March 26, 2014 at 3:31 pm

I do think he’s giving Rauner something to run on. The Democrats in Springfield asked for more money on a temporary basis to fix the state’s budget problems. They didn’t. They delayed just about everything until the very last minute and then dodged every bullet they could. How will things improve if the tax increase is made permanent?

PD Shaw March 26, 2014 at 4:05 pm

The ads write themselves, and I’m sure everyone in Illinois, not living in Springfield will hear plenty of them.

It looks like Madigan wants to move on the increase this Spring, maybe he knows something we don’t.

The local paper calculated that since a Republican was last governor, state public employment (not local or federal) has declined 25%. I think the gist of the problem is that this has largely been done by not hiring new, younger, cheaper employees, and it does very little to offset increased wages, healthcare and pension benefits. If the process continues, the state will eventually have one multi-millionaire employee, and he/she better be damned good.

And the problem for those I see commenting over at Capitol Fax about the burden is now on Rauner to identify those cuts is that (a) I don’t see a lot of people caring about state services or that knowledgeable about them, and (b) Rauner will just do what Quinn has been doing with no new hires, fewer employees will have to cover a wider range of responsibilities and do it poorer. There is no state football team to threaten to eliminate.

PD Shaw March 26, 2014 at 4:06 pm

. . . those cuts that would be needed without extending the tax increase . . .

Dave Schuler March 26, 2014 at 4:21 pm

What Quinn was very careful not to claim was that state employee expenses were declining because they’re not. As I’ve been pointing out for some time, they’re cutting jobs so they can give the remaining employees raises.

Yeah, I’m not sure what Rauner can actually do. Illinois has long term problems and short term problems. Long term solutions are good but the short term problems are darned pressing. By the time the long term solutions have any effect Rauner will have been voted out of office.

Medicaid is the one area that has potential. It’s the state’s largest budget line item so from an optimization standpoint it’s a good place to start. The proverbial waste, fraud, and abuse. Itr needs structural change—basically reversing the expansion that Rod Blagojevich put into place.

However, the real solution to Illinois’s Medicaid problem has to come from Washington and Washington has shown few signs of wanting to deal with it. There are other, more vote-getting problems to address.

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