The state of Illinois’s budget deficit is the largest of any state in the Union:
SPRINGFIELD, Ill. — While most other states enjoyed a little extra cash, Illinois suffered a $3 billion deficit in fiscal 2005, the largest shortfall in the nation.
Illinois also brought up the rear in another category. Its total debt — such as pension obligations and unpaid medical bills — outweighed total assets by a staggering $17.5 billion, the Rockford Register Star reported Monday.
But Gov. Rod Blagojevich’s budget director said the state’s financial condition isn’t as bad as those numbers suggest.
John Filan said Illinois is taking in more than enough money each year to pay its annual expenses. If you look at cash coming in the door versus cash going out, the state budget is balanced, he said.
“In terms of day-to-day running the joint, so to speak, we’ve taken in more money than we’ve spent in terms of expenditures,” Filan said.
The deficit comes up when looking at obligations that have built up over years or, in the case of pensions, decades.
As Mark Twain said (about being tarred and feathered and run out of town on a rail): “If it weren’t for the honor I’d just as soon have walked.â€
I hate to break it to Mr. Filan but money is fungible: you can’t partition the state’s budget the way he’d like to do. In the state of Illinois obligations like state employees’ pension have constitutional force. This has been fully litigated. It’s settled law. The only way the for the state to actually get out from under the obligations is by amending the state constitution and I’d hate to be the state legislator or governor who tried to pass such an amendment.
What’s worse Governor Blagojevich has aggravated the situation by deferring the state’s contributions to the state employees’ pension funds. That might make sense if interest rates were falling but it’s irresponsible when it’s quite obvious that interest rates will be rising.
Oh, well. No doubt he’ll be out of offfice by the time the bill comes around.
