The editors of the Wall Street Journal are chortling over the rejection of the “Fair Tax” amendment on which Gov. Pritzker has lavished so much of his own personal funds:
The U.S. electorate Tuesday declined to endorse sweeping progressive change, and that sentiment extended even to deep-blue Illinois. Democratic Gov. J.B. Pritzker, supported by liberal luminaries like Sen. Dick Durbin, exhorted voters to pass a referendum that would repeal the state’s 4.95% flat income tax to allow for higher top rates. Voters declined.
Like other progressive defeats across the country, this one was more marked than polling might have suggested. Gov. Pritzker ran on the “fair tax†in 2018 and a March 2020 poll showed 65% support. But the measure was defeated 45% to 55% as a critical mass of Democratic voters broke with the party’s state leadership.
concluding
The strong performance of Senate Republican candidates nationwide also means that a federal bailout aimed at propping up unsustainable state budgets is unlikely. The Democrats at the helm of Illinois’ sinking fiscal ship may be running out of options short of sustainable public-sector reform.
I wish I were as confident as they. It reminds me of the famous wisecrack attributed to Winston Churchill (but actually something like it was said by Abba Eban): the Americans always do the right thing—after all other alternatives have been exhausted. I think that another famous quote is more likely to motivate Illinois’s political leaders, this one said by Nikolay Chernyshevsky: the worse the better. I think they will cling to their profligate ways as though their political lives depended on it because they do.
I’ve read some complaints that the Governor waited until mid-Summer to pour $50M into a campaign fund for the tax and didn’t really start spending until his cousin started dumping tens of millions to oppose it. Money is speech; speech is money.
Fundamentally, I see a drafting issue. The flat tax in the Constitution acts as a limit on income tax increases; that was its intention. Without the limitation, the State would be more politically capable of increasing rates and types of income subject to taxation. The Governor points to the tax brackets passed by the legislature contingent on the referendum passing. But people don’t trust the legislature after they passed “temporary income tax to address pensions” that became mostly permanent.
The tax amendment could have included tax caps, definitions of taxable income, limits on the number of tax brackets or restrictions on ratios of the lowest to highest rates, etc. It wasn’t; the Governor probably negotiated with himself on the wisdom of his language, and a year-and-a-half later other people got their say.
The history of graduated state income taxes is one of very frequent changes in rates and brackets. IIRC Connecticut, the last state to create a graduated state income tax in 1996, has increased rates at least ten times and the number of brackets from two to seven.
Pritzker is now blaming Illinois’s fiscal problems on Rauner which is about the looniest thing I’ve heard recently. Rauner was a victim of Illinois’s fiscal problems not its author. For authorship you need look no farther than Mike Madigan but Rod Blagojevich was certainly a willing dupe in the process.
The Governor can now blame the voters (or absolve himself) of the problem.
I had a great plan; but voters rejected it; not my fault if something bad happens.
I’m sure that’s his theory. So much for “The Buck Stops Here”.
Rich Miller at Capitol Fax makes a good point. In order for the referendum to pass, Pritzker needed the support of all of the people who either voted for him or for Biden, plus some portion of the voters who did not. By getting only 45% of the vote for the referendum, its clear that Pritzker did neither.
https://capitolfax.com/2020/11/05/not-a-good-look-governor/
Two points:
1. If you’re not familiar with Rich Miller’s blog, Capitol Fax, it provides a pretty good window on regular Democratic thinking in Illinois.
2. This just shows to go you that Pritzker is not an astute politician. Why should he be? He has never needed to cultivate the skills of a politician but in his defense, few Illinois politicians have. When you have the votes to roll right over your opposition, why cultivate political skills.