First things first: after what we’ve suffered through in recent years, merely being able to say “Governor Pat Quinn” is almost as delightful as being able to say “President Barack Obama.” 😎
After a mere seven weeks in office, Illinois’ new governor has a budget proposal ready, and he gave a formal address in Springfield yesterday announcing it. I listened to the whole thing on Chicago Public Radio, unfiltered and uninterrupted, no sound bites, no spin. (Who doesn’t love public radio?) Anyone who missed it can listen here, or read the full text here (courtesy of the Tribune’s Eric Zorn).
It was a strong speech, and it sounds like a courageous budget—tackling some issues that state government has been dodging for years. There will nevertheless be a great reactionary hue and cry (as the comment thread on the Trib‘s initial article demonstrates) because it includes a small income tax increase.
Predictable reaction notwithstanding, Quinn is doing what needs to be done. Illinois has been suffering from a structural deficit for years. This year alone it’s $11.5 billion. The state has an income tax that is both too low (a mere 3%, consistently bringing in less revenue than necessary to cover basic public expenditures), and flat (putting a disproportionate burden on the citizens least able to bear it).
(Other taxes here in Chicago are high and/or needlessly complicated—sales tax and property tax, in particular—but the blame for those falls on city and county government, not the state.)
Illinois has needed income tax reform for years. It’s the only way to address the deficit, it’s the only way for the state to meet its obligation to redress local education funding inequities, and it’s frankly a matter of basic justice. Outside experts such as Ralph Martire of the Center for Tax and Budget Accountability has been writing and talking about this for years… but politicians have always treated the topic as untouchable. Until now.
Quinn’s proposal is elegant and simple. State income tax will be increased from 3% to 4.5%. Critics are misleadingly slamming this as a “fifty percent tax increase,” but that’s not only rhetorically deceptive, it’s simply wrong—since Quinn has paired it with an increase in the personal exemption, tripling it from $2000 to $6000 per person in a household. That makes the system immediately more progressive: per Quinn’s example, a family of four earning up to $61k (above the median household income) will actually save money, and the burden increases only gradually above that break-even point. Fully five million of Illinois’ 13 million people will come out ahead.
He’s also proposing a ten-day sales tax holiday, closing corporate tax loopholes, and putting $1.3 billion of state spending cuts on the table—including brief employee furloughs, targeted program cost reductions, and reduced state grant funds. What he’s not doing shifting revenue around with accounting games, or privatizing state assets for short-term lump sum gains, or proposing new gambling licenses as a substitute for a genuinely productive tax base, as his predecessor did. Nor is he imposing mass layoffs and slashing state programs to the bone, as some anti-tax zealots would prefer. Quinn repeatedly dismissed such ideas as “mean-spirited”—rightly understanding that things like schools, parks, health care, law enforcement, and basic public services are more important, not less, in times like these.
Quinn presented his plans under the rhetorical umbrella of “Three Rs”—Reform (of government corruption, a lifelong pursuit of his), Responsibility (of the fiscal variety), and Recovery (in response to the current crisis). The “responsibility” aspect we’ve already discussed. As to the others, reform-wise, he’s already ordered full cooperation with FOIA requests, and has a newly established Illinois Reform Commission, headed by former U.S. Attorney Patrick Collins, working on recommendations to ensure open, transparent government and constrain the sort of self-serving sweetheart deals that have so long characterized Illinois politics. Recovery-wise, he’s taking a page from Obama’s book and reallocating state spending priorities toward economic stimulus—emphasizing transit infrastructure, schools, and sustainable environment and energy projects. (In one of the speech’s few sour notes, he also endorsed the long-controversial idea of a “third airport” in Chicago’s south suburbs—although the idea is surely even less viable in this economic climate than it was in years past.)
All in all, Quinn’s proposals offer a sound and credible response to the problems that were thrust upon him. It’s nice to see a grown-up running state government for a change.
Of course, as noted, the initial “anti-tax” outcry is loud and angry. To quote one representative comment from the Trib thread:
“State workers should be forced to take cuts like everone else, they should have pay and benefit cuts, defined benefit pensions should be completely done away with and replaced with 401K like the corporate world, toll collector and street sweeper salaries should reflect skill level they should make minimum wage nothing more these are not jobs deserving of high salaries and defined benefit pensions,raising taxes on hard working middle class people is insane, when will these people learn about fiscal responsibility.”
Such rants notwithstanding, however, there really are no other serious proposals on the table. Some high-profile officials have minor quibbles, but there’s an excellent chance that most of Quinn’s plans will survive the gauntlet of the state legislature. As House Speaker (and top legislative power broker) Mike Madigan put it, working relations with Quinn are “Six thousand percent better than the last guy, who shall remain nameless.”
Crisis does sometimes present opportunities. While a hard look at Illinois’ political history doesn’t really inspire optimism, nonetheless there has been a real shift with Quinn’s ascension. Let us hope that for a change wiser heads will actually prevail in Springfield. (And for reading this who live here, now would be a good time to look up your State Rep and Senator and encourage them to be those wiser heads… or at least follow their lead.)Tags: budget proposal, Chicago, economy, Illinois, Mike Madigan, Pat Quinn, taxes