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* Gov. Pat Quinn was asked yesterday about whether the “temporary” state income tax hike should be allowed to expire…
Gov. Pat Quinn refused to weigh in — here’s how he answered when asked about supporting the higher income tax:
QUINN: “Well I think we have to deal with the pension reform which is the number one fiscal, financial issue.”
REPORTER: But … you campaigned on raising the income tax, should it stay in place?
QUINN: “I have worked very hard on pension reform, I know the committee that I proposed …”
Illinois’ has a 5 percent income tax; it’s scheduled to drop to 3.75 percent in 2015.
posted by Rich Miller
Friday, Oct 25, 13 @ 10:06 am
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Comment by Shemp Friday, Oct 25, 13 @ 10:12 am
Let me say this about that……….
Surprised with the short answer. No waxing poetic about the Grand Mississippi or the great Chicagoans or the down to earth hard working corn farmers. Stick to the script, Pat, stick to the script.
Comment by dupage dan Friday, Oct 25, 13 @ 10:13 am
I would not plan on us ever lowering the tax. As far as pensions being solved ,as long as Cullerton
runs things it will never happen.
The unions have won and will win as long as Cullerton and Madigan are around.
Our State is headed for Junk bond status.
Comment by mokenavince Friday, Oct 25, 13 @ 10:13 am
What exactly has Quinn done regarding pensions other than demand the legislature do something and veto legislator salaries ? What were his proposals ? What legislation did he have introduced ? Governor complaining that nobody’s solving it isn’t work. In reality, Cullerton got it right. There really is no crisis. The so called crisis is manufactored. You have been spouting the rhetoric of the Civic Committee for the past few years. The fact is that the ramp could be reset & the crisis is over. It appears that “pension reform is the central theme in his re-election campaign. Governor, how can you run on an issue that you have been a miserable failure at solving ?
“I have worked very hard on pension reform”
Comment by AFSCME Steward Friday, Oct 25, 13 @ 10:14 am
Have a talking point. Use it when you don’t want to answer the question posed.
Comment by Darienite Friday, Oct 25, 13 @ 10:16 am
Too bad the Chicago media will not put front and center quotes from all these politicians that insisted this was temporary and we were just going to catch up on bills with it… Then compare to quotes today.
They all knew it was permanent. And any voter that believed it was temporary almost should not be allowed to vote.
Comment by RonOglesby Friday, Oct 25, 13 @ 10:18 am
@mokenavince. Stop with the union bashing. Illinois government employees have earned their pensions. The pensions represent a legal, binding contract, and now the state wants to abrogate its obligations. If you need to blame somebody, blame the elected officials who failed to adequately fund the pensions. The blame falls squarely at their feet.
You are wrong to say that unions have won, they are fighting a rear guard action to merely keep what they have rightfully earned.
And by the way, keep the tax as it is. The state needs the revenue.
Comment by phlegm640 Friday, Oct 25, 13 @ 10:22 am
The unions have won and will win as long as Cullerton and Madigan are around.”
Which explains why SB 2404, the union pension reform bill, wasn’t called for a vote in the House, and which explains why the appropriations bill for union back-wages wasn’t passed.
If Madigan was in the unions’ pocket, the bills would have most likely passed.
Comment by Grandson of Man Friday, Oct 25, 13 @ 10:27 am
LOL, the race for Governor is going to be a referendum on keeping the tax at 5%. Quinn can bob and weave all he wants, but he’s not going to escape the issue and neither will his opponents.
With the possible exception of Rutherford, I don’t think any of the GOP candidates will say they want to keep the 5% tax, even though in secret they all know they can’t govern without it.
Comment by 47th Ward Friday, Oct 25, 13 @ 10:30 am
Full Definition of POLITICIAN
1: a person experienced in the art or science of government; especially : one actively engaged in conducting the business of a government
2a : a person engaged in party politics as a profession
2b : a person primarily interested in political office for selfish or other narrow usually short-sighted reasons
Looks like Quinn falls into the 2B definition of a politician.
Comment by Jolly1 Friday, Oct 25, 13 @ 10:30 am
Ron, maybe if the bond sale that was supposed to have occurred with the temporary income tax hike had not been blocked, things might have been different. We’ll never know. However, extending the temporary tax hike beyond it’s original sunset, does not mean it’s permanent, as much as you’d like to run with that talking point. Try facing up to reality. Illinois has bills to pay and needs revenue to pay them. What’s your solution to not maintaining the increase? You can’t keep using pensions as your piggy bank now that we have this pension debt crisis. So, instead of attempting to mimic right wing talking points, explain how we’ll pay our collective bills in this state if the temporary tax hike were to sunset as you’d like. I anxiously await your response.
Comment by PublicServant Friday, Oct 25, 13 @ 10:30 am
QUINN: “Well I think we have to deal with the pension reform which is the number one fiscal, financial issue.”
Expiration of the income tax would cost the state $5.4 billion a year, while Quinn’s preferred pension reform would save the state $1.8 billion. How is $1.8B of greater import than $5.4B when the latter is three times the former?
In addition, does Quinn think he can dodge the tax issue until after the next election? His GOP opponents will take a foursquare position against it, (even though they will be plenty vague about where they will cut $5.4B from the budget.)
Comment by reformer Friday, Oct 25, 13 @ 10:32 am
PQ = 1 Trick Pony
Comment by kerfuffle Friday, Oct 25, 13 @ 10:34 am
Ron
The grand old man of the GOP is Jim Edgar. In 1990, he ran on a platform of making Thompson’s temporary income tax hike permanent. Edgar argued the state needed the revenue to pay its bills. Was Edgar wrong? Or is it different when a Republican does it?
Comment by reformer Friday, Oct 25, 13 @ 10:37 am
@Public Servant…
So all of your points point straight to a permanent 5% correct… Isn’t that what I said.
Did I say we didnt need the money? or make any moral or fiscal case for it not being permanent.
No. I said ANYONE that thought it wasnt going to be permanent and believed these pols basically was fooled and maybe shouldn’t be allowed to vote. AND that these Pols that sold it to them should have their own words tossed in their face daily.
Its funny. I didnt have a talking point, but you seem to be spouting a ton there disagreeing with something I never stated.
Comment by RonOglesby Friday, Oct 25, 13 @ 10:38 am
A surprising degree of message discipline from Pat.
– MrJM
Comment by MrJM Friday, Oct 25, 13 @ 10:38 am
“all these politicians that insisted this was temporary”. Yes the 5% income tax was and is temporary; everybody knows a 5% income tax is nowhere near high enough to cover all of the states spending. The 5% tax will be allowed to expire and replaced with a much higher tax. Politicians will be able to say with a straight face the tax was temporary.
Comment by Angry Republican Friday, Oct 25, 13 @ 10:38 am
@reformer
See above post to public servant.
I never argued we didnt need the money, or whether 5% was right or wrong. I pointed out the huge amount of lying, politics and BS that was used to sell this. When anyone in their right mind knew it was permanent.
again, dont shoot the messenger for pointing out lies from politicians. and then build straw men on things I have not said.
Comment by RonOglesby Friday, Oct 25, 13 @ 10:40 am
I’m very intrigued by what might happen to the tax rate by the end of 2014. I think there is a real chance that it will go down to 3.75% whether the state can afford it or not. Will Madigan make all of his Dems vote to extend or make perm that hike? Not if you look at their campaign rhetoric from 2012.
I think Madigan may just let the 2014 election happen, then either hike it during veto session or, if there is a GOP Gov, let him own the problem and figure it out.
Comment by JoeD Friday, Oct 25, 13 @ 10:44 am
No question that this question will not go away anytime soon and will certainly linger into the campaign….I am pretty sure the Governor is bound to present an annual budget to the General Assembly in the spring? So, will the Governor exclude revenue in that budget that is set to expire??? If so, LOTS of cuts…if he includes the revenue from the current tax rate to be part of the budget knowing that the effected FY14 budget would be lacking that revenue then he is indicating that he intends to push for the current rate?
Comment by figures Friday, Oct 25, 13 @ 10:46 am
The state wants higher revenue because government workers that Quinn represents aren’t net taxpayers.
https://www.youtube.com/watch?v=Mr4WN4vyevA
Comment by Steve Friday, Oct 25, 13 @ 10:55 am
Yes this will be a very interesting process to see play out. Especially if these fiscal issues get turned into referendums by state wide candidates (Rauner, Quinn, etc).
Unions and stateworkers could find themselves under a level of scrutiny never previously experienced with regard to the pension situation as tax extensions and even tax increases are being discussed. Meanwhile funding to schools and other services are being crushed.
The voters at large are becoming more aware of these issues.
Comment by skeptical spectacle Friday, Oct 25, 13 @ 10:55 am
The reality is, the State has to keep all or at least most of the 5 cent income tax.
But admitting to that takes the pressure off of the pension bills.
The biggest issue is that, politically, the message has been that the pension payments are the cause of all of our financial mess. It was a spin job from the beginning (hey - Illinois was deficit spending before the recession AND before the pension ramp hit us hard) - but now it is out there. Tough to back away from. Cullerton is taking heat.
The truth is that Illinois needs to keep a higher income tax rate (or a replacement revenue) - there just isn’t another $5 to $6 billion to cut out of the budget. “Pension reform” might take $1 to $2 billion out - but there isn’t anywhere else to turn.
So - the pension reform is only saving .4 to .5 cents of the 5 cent income tax (1/3 of the reduction to 3.75 cents). And for that, the State politicians would be willing to break two sections of the constitution - the Bill of Rights (article 1, section 16 guaranteeing the sanctity of contracts - and article 15, section 5 Pension and retirement rights).
Comment by archimedes Friday, Oct 25, 13 @ 10:55 am
Rather than come up with new verbiage, I’m just going to repeat, emphasize and slightly expand my comment from Oct. 22:
Gov Quinn, put very simply, the pension mess is not a crisis. If the State continues to make the scheduled payments, everything will be fine with the pensions and you know it.
The “Crisis” is the GA and Gov doesn’t want to continue to make the payments at the scheduled level … because that requires either (a) HIGHER TAXES than the expiring temp tax or (b) ETREMELY DRASTIC CUTS to school funding and welfare … and neither the GA nor the Gov won’t support either of those actions for fear of losing their seats.
Comment by RNUG Friday, Oct 25, 13 @ 10:56 am
It’s certainly needed, Ron, until we pay off our mountains of debt and control our spending in this state. I didn’t realize you were providing a public service announcement informing the choir here of the fact that politicians lie. Thanks for that. It would be nice to find out where you do stand on whether or not “we need the money, or whether 5% was right or wrong”. Just so we know where you stand on the issues confronting the state during this, the Great Recession through which we’re all suffering…some more than others.
By the way, I still take issue with your ‘permanent’ conclusion, since permanent is a very long time. I do, however, agree with your assessment of the truthfulness of politicians.
Comment by PublicServant Friday, Oct 25, 13 @ 10:57 am
Public Servant - “However, extending the temporary tax hike beyond its original sunset does not mean its permanent”
- Give me a break! If you extend the sunset the tax increase is can and will be extended again and again making it ad infinitum. How temporary is that? It is just politically expedient to kick the can down the road in order to let someone else take care of the mess at a later date.
Comment by kerfuffle Friday, Oct 25, 13 @ 11:00 am
So, 47th Wared, what you seem to be saying is that the politician who is better at lying to us about the tax will win, right? So, what else is new?
Comment by dupage dan Friday, Oct 25, 13 @ 11:01 am
sorry, 47th Ward. I don’t even know what a “wared” is.
Comment by dupage dan Friday, Oct 25, 13 @ 11:01 am
==The state wants higher revenue because government workers that Quinn represents aren’t net taxpayers.==
That is the most asinine comment people can make. You can’t be that dense.
Comment by Demoralized Friday, Oct 25, 13 @ 11:01 am
RNUG, with all due fairness, further drastic cuts to education impact more than the politicians that impose them. We’re talking about kids here, you don’t get a second chance shaping a child’s developing brain.
Comment by Small Town Liberal Friday, Oct 25, 13 @ 11:03 am
AFSCME STEWARD - Your self-serving rhetoric puts Gov. Quinn in a no-win scenario. You got your raises. He supports the legislation to give you your pay raise. He’s trying to preserve your pension for you and your family and future generations. And all you can do is find things to whine about.
Comment by Stan the Man Friday, Oct 25, 13 @ 11:03 am
==Unions and stateworkers could find themselves under a level of scrutiny never previously experienced with regard to the pension situation==
What kind of scrutiny other than the normal bashing of state workers?
Comment by Demoralized Friday, Oct 25, 13 @ 11:04 am
@Public Servant…
I didnt know I was running for office and required to show you my position on topics of the day. The POST was about Quinn not answering questions. I STATED that their OWN WORDS should be thrown back at them.
Do I think it should expire? Not as setup now no. We can’t pay what we have on the books TODAY. Yet we also have a GA that spends MORE than we take in and have for years. this 5% isnt enough to cover what they have already promised, much less their FUTURE PROMISES to get them reelected. And we have a press that wont throw it back at them.
What should we do? If I was in charge and could be the ILGA AND Gov? Leave it permanent. You can’t ask for another increase but you can stabilize and make predictable the number. And be honest about it with the people.
But then say HERE ARE OTHER CHANGES>>> that are going to help attract new business here and grow our revenue. Our old plans have not worked out for the last decade, we have lagged behind other states, but here is how we change some policies to make us more compatible with the fastest growing states!
You wanted my position. There it is. It has NOTHING TO DO WITH THE ABOVE POST. But I get you need to attack anyone that doesnt back your politicians.
Comment by RonOglesby Friday, Oct 25, 13 @ 11:05 am
==But I get you need to attack anyone that doesn’t back your politicians. ==
You know what they say. If you can’t take the heat get out of the kitchen.
Comment by Demoralized Friday, Oct 25, 13 @ 11:08 am
And AFSCME STEWARD, Gov. Quinn supported and campaigned on the need for a tax increase that AFSCME so badly wanted for years. You and Henry Bayer’s disingenuousness is really shameful. YOU are the reason for the tax increase. What exactly is your position on it? And who will you ambush after laying in the weeds during the run up to the election. The phrase “thank you” is not something you are capable of uttering. Shameful.
Comment by Stan the Man Friday, Oct 25, 13 @ 11:11 am
@Demo
I am fine arguing positions. If people will actually respond to what I said and what the post was about. But I guess its an open forum so hack at someone if you say politicians should have their words thrown back at them. Of course in this state that is only OK if that Politician has an R next to his name.
Comment by RonOglesby Friday, Oct 25, 13 @ 11:12 am
==Of course in this state that is only OK if that Politician has an R next to his name. ==
Don’t give me that whiney nonsense. I get so tired of this “woe is me” stuff about Republicans. If they spent less time whining about people “picking” on them and more on actually having ideas then maybe people wouldn’t pick on them. But whine away if you think it helps.
Comment by Demoralized Friday, Oct 25, 13 @ 11:15 am
@Demo,
you belong on the Tribune boards or something. I come here to talk about posts. I want to read about policy boiled down. I am not woe as me. Its the poor people like you and Public Servant that get butt hurt when someone points out the ruling party in Illinois should have their words tossed back at them… Not me buddy. Have a nice day. I dont need any lines from more D’s that dont want to discuss topics and instead somehow make everything the R’s fault.
Comment by RonOglesby Friday, Oct 25, 13 @ 11:20 am
For those who think the next election will shine a focus on state employees, salaries and pensions, I’ll make a couple of points.
1) The vast majority (86%) of the government workers that people keep bemoaning are the same people who are teaching your kids, either locally (55%) or at the various colleges (32%). Are those teachers underpaid or overpaid? Don’t you, the voter, control at least the primary and secondary teachers via your local school boards which you elect?
2) When it comes to actual state workers (13%), there are two different debates to be had.
2a) Is the state delivering services the State does not need to be delivering? If yes, then there are unneeded state employees which could be eliminated.
2b) Assuming we are talking about needed State services (however you wish to define that), then staff is needed to deliver those services. Which leads to the next question, are the State employees being compensated at market value, including all benefits such as insurance and pension, for the job being done? I’m not talking about some bogus pay equality study for this gender group or that racial group, but a straightforward comparison that says a person with this level of skill in this market is worth this much compared (when possible) to the same job in the private sector? Based on my experience, I suspect the answer to that question will be the lower skilled positions are probably being overpaid and the higher skilled jobs are being underpaid. Then the question becomes how do you rectify the situation?
Comment by RNUG Friday, Oct 25, 13 @ 11:22 am
47th Ward is correct about the Guv election being about the income tax, but the moment of reckoning for Quinn will come well before Election Day. He has to give a budget address in February for FY14. The income tax is schedule to expire halfway through the Fiscal Year. That means he has to account for about a $3 billion revenue hole just a few months for now, before we even know who the GOP nominee is.
Comment by Frank Friday, Oct 25, 13 @ 11:23 am
When people talk about school funding, just what exactly is it that needs funding? In every operation, the bulk of the budget goes to employee payroll. Schools provide a service. Payment for services rendered will create costs. Just think of all the money we all could save if we could stiff our doctors for services rendered.
Comment by Anonymous Friday, Oct 25, 13 @ 11:24 am
@Ron:
Grow up.
I didn’t make anything the R’s fault. I just called you out for whining about people picking on R’s.
Oh, and grow up.
Comment by Demoralized Friday, Oct 25, 13 @ 11:24 am
Because @Ron has whined about being picked on and people not responding to the post, I’ll respond to the post.
I think the Governor, like anybody else who does so, is being disingenuous by not stating the simple fact that the tax increase cannot be allowed to expire. I realize it’s politically expedient, but I would respect candidates more if they would tell the truth on that issue.
Comment by Demoralized Friday, Oct 25, 13 @ 11:27 am
Like Diogenes, looking for an honest man, we can go forth and see if there is a soul in this state that actually believed that the increase was temporary…
Will there be a misguided person found?
Comment by Plotocrat03 Friday, Oct 25, 13 @ 11:28 am
Small Town Liberal @ 11:03am
I’m not in favor of further cuts to education (unless we’re talking about getting rid of some of the administrators in top heavy organizations), I’m just pointing out the choices because that is where the money is.
Personally, I think the State needs more revenue than the current level. Instead of debating how to steal the money from retirees or arguing over the need, which is obvious, the politicians should be debating the best way to raise additional revenue, either through a higher flat tax, switching to a graduated income tax, or some other combination of tax changes.
Comment by RNUG Friday, Oct 25, 13 @ 11:29 am
Back to the original post…why does the media continue to allow PQ and virtually all politicians to get away with non-answers? Responses to direct questions are nearly always only talking points. Result: no one has learned anything, only reinforced a politician’s penchant for self-serving rhetoric. It will take a concerted, coordinated effort by reporters to get straight answers to straight questions, but that used to be the reporter’s job.
Comment by The Whole Truth Friday, Oct 25, 13 @ 11:32 am
I’ve said it before, as have others ….
A solution to the problem exists. Pay the pension payment. There is a plan in place and it is being executed. The ramp has slowed to a manageable rate.
If the higher income tax must remain in place, so be it. If other programs cannot be expanded, so be it. These are penalties for past sins.
Make modifications that are constitutional, pay the pension payment, move on.
Comment by Jack Handy Friday, Oct 25, 13 @ 11:34 am
Unfortunately, today too many reporters (or their editors) won’t just print that xxx refused to answer the question.
Comment by RNUG Friday, Oct 25, 13 @ 11:35 am
Why can’t some people understand that the current structures of the Illinois’ pensions systems are very sound and are not in need of “reform.” Pension reform basically means pension cutting which in no way will solve the problem. The real problem is the payment on the debt and the loss of revenue if the “temporary” personal and corporate income taxes are allowed to sunset. It’s been estimed that even with anticipated growth in sales tax income and other new sources the state will incur a $3.76 billion LOSS in overall revenue if the income taxes are allowed to expire. Why won’t Quinn acknowledge and address this?
Comment by My Thoughts For Whatever Friday, Oct 25, 13 @ 11:41 am
RNUG-
You’re probably right…it’s editors as much or more than reporters. Which indicates the problem is higher within the media industry. The free press was intended to act as a watchdog, if not a check, on government. Somehow, that role has been compromised.
Comment by The Whole Truth Friday, Oct 25, 13 @ 11:42 am
===A solution to the problem exists====
That’s exactly what has the pension fund contributors totally outraged. Yes, there are solutions that don’t diminish benefits. But for some reason (civvies perhaps?) they don’t want a SOLUTION that doesn’t hurt retirees. They want to do damage. What they really want is access to the money in the funds. More of it. Give retirees less of it. It is targeting and damaging a specific segment of this state’s population. Yes, there are solutions but our politicans and those that pull their strings don’t want things to stay the same.
Comment by Anonymous Friday, Oct 25, 13 @ 11:53 am
Rln: There were some legislators who did in fact believe it could be “temporary” if three things bore fruit:
1. The hard cap on spending set in the budgeting process by Nekritz’ bill which worked that year, was meticulously followed in the out years
2. the debt was restructured as proposed that same day,
3. Kotowski’s “budgeting for results” processes were strictly followed by agencies and appropriations committees,
4. substantial pension reform, as then proposed, and later sponsored by the Speaker
5. the Illinois economy recovered at the rate then forecast by most local economists.
It was all laid out for those who cared to study the problem, and the numbers would then just barely work for the medium and long term.
Well you know what happened. #1 was fully implemented as designed in year one, and somewhat fudged in following years. #2 was rejected in a group vote by the GOP caucuses. #3 was slow to gain traction, and is still a valuable work in process. #4 the Speaker has tried and so far failed, to achieve this goal with the numbers that work. And on #5. they were overly optimistic by about a third.
That was a tall order for anyone to buy, but some wanted to believe it was possible. I argued that we should not call it “temporary,” but it could “sunset” if other things occurred.
Admittedly a bit complex for a political statement.
That’s what happened. To call it “lying” is unfair for some. To call it foolishly optimistic is closer to the truth for them.
The reality remains: While we cannot get the hard results from things like #’s 1-5 above, for whatever reasons, then the tax increase is permanent.
Comment by walkinfool Friday, Oct 25, 13 @ 11:55 am
===why does the media continue to allow PQ and virtually all politicians to get away with non-answers?===
As someone (and I’m in no way alone) who has tried hard to press a question on Gov. Quinn and others, I can assure you that he’s quite adept at evasion. Plus, there are always other reporters present who have their own questions on their own topics. You can’t just stand there forever. It’s not like we have subpoena power to compel an answer.
I remember asking Jack Ryan a single question over and over and over again during a press conference. He finally said “How many times do I have to answer this?” and my response was “Once.” He never answered the question.
In other words, it’s a lot harder than it looks.
Comment by Rich Miller Friday, Oct 25, 13 @ 12:00 pm
RNUG,
First, I really respect your input and opinion. I have learned a great deal from you. I agree with many of your positions and your data generally looks really good.
However I think do think the pension programs need to be reformed and that ultimately they will, because at some point it will be politically, if not financially, impossible not to reform them.
I don’t think significant tax increases or even extensions are going to be politically possible without the pensions being addressed. And though the temp tax increase is worth more than the pension amounts yearly, the pensions are still a huge part of the problem.
Further many people will argue (rightly or wrong, legally or illegally) that funding our schools at the levels that were “promised” and other critical social support programs are much more important than maintaining (perceived generous) pension programs unscathed while the rest of the state craters.
For example if the current pension system went for a statewide up or down vote do you think it would pass in today’s climate? I understand this is a hypothetical which will never occur but I Think it informs the politics of these issues.
RNUG, I highly respect your thoughts and work, but I think outside “the inside” of our state, the politics is starting to work against those who are entrenched against any sort significant pension reform.
I agree that it is possible that the income tax extension will not be passed…..something which I personally think would be terrible for our state. Can you imagine what kind of situation that will put our state in and the sort of drastic cuts which could take place?
Comment by skeptical spectacle Friday, Oct 25, 13 @ 12:03 pm
The tax increase will stay in place.
I just noted a full page article in the Skokie Pioneer Press (10/24/13)that a group called S.O.R.E (Skokie Organization of Retired Teachers)picketed the office of State Sen. Biss expressing opposition to changes to their pensions.
I suspect the local picketing would intensify dramatically if the pols got serious with pension changes that lowered benefits. I just don’t see Illinois politicians taking that route in the face of such a well funded and organized opposition such as the teachers.
So, the tax stays in place and the pols start wacking in the weeds for additional revenue. Isn’t someone in Chicago talking about a bicycle tax?
Comment by Cook County Commoner Friday, Oct 25, 13 @ 12:11 pm
@Stan the Man - well said Stan
@RNUG 2b) absolutely correct. I became a state employee after woring in my career field for over 25 years. I have found that the less skilled workers are paid much higher than their counterparts on the private side, and the higher skilled (non-technical)are being paid lower. Also, the latter have had no pay raises for over 5 years. How is the brain drain going to be overcome is a pertinent quesstion to ask as well?
Comment by captaingeorge Friday, Oct 25, 13 @ 12:15 pm
Can you believe him no matter what he says. 1% before election then 2% after. You know, things have changed.
Comment by Mouthy Friday, Oct 25, 13 @ 12:31 pm
skeptical spectacle @ 12:03 pm:
First, thanks.
Second, you do realize that the already enacted Tier II changes are the drastic pension reform you are advocating and they have also been enacted in other states? The reason that making those changes in IL did not improve our state’s bond rating is because it was only part of the proposed solution; the State did not follow through on the bonds to pay off the bill backlog and the State only took a half step at the revenue problem by enacting the tax increase as temporary. About the same time, California had basically the same problem and took the same steps except they made their tax increase permanent; the combination of changes resulted in their bond rating immediately being raised. It’s the revenue uncertainty that has the bond market constantly lowering the Illinois rating.
Would a state-wide referendum on pensions pass today? I think it probably would. We basically had such a referendum when the voters did not call for a constitutional convention. Some surveys, including some Rich has referenced over the past year, seem to show the voters understand the propsoed cuts are unfair and the problem is not the cost of the current pension requirements but the cost of paying back all the money that was diverted by the State from the pensions to pay then current operating expenses. Would such a vote be a slam dunk? No, it would probably be close because the low information voter will buy the story spun by the Chicago business groups. The worst thing the state retiree groups did was fail to fight the Chicago media campaign; you can go back at least two years to see my comments railing against the union and retiree groups for ignoring the attacks.
The real question, as you note, is whether the Gov and GA will actually let the temp tax increase expire and completely tank the state. Logic dictates they should be smarter than that, but politics often overrides logic.
A State level shutdown would be unimaginable. One choice would be for the state to just not pay anything into the pension systems … but that’s kind of how we got to this point in the first place. Otherwise, things like schools, mental health and prisions would take huge hits. About the only thing that wouldn’t take much of a hit, relatively speaking, is welfare since it’s 90% or so federal money. And I could see every county and city getting hit big time also if the State, in deperation for revenue, stops all the revenue sharing of the various taxes.
Right at the moment, I’d give about 60/40 odds that a revenue solution will be found and we’ll appear to avoid the train wreck. But if part of the revenue “solution” counts on savings from unconstitutional diminishment of pensions, it will be a slow motion train wreck … fascinating to watch but unfortunately every one of us IL citizens will be on it. And we’ll be having this same discussion in about 2 years …
Comment by RNUG Friday, Oct 25, 13 @ 12:40 pm
Not a slam at Rich but I am angered and depressed at how very little the press actually “presses” Quinn and others for answers to anything these days. I don’t know if the younger reporters are too shy to be aggressive, too disengaged, intimidated or afraid of losing access, or what. But when you attend a press conference and all you do is write down what the guy repeats out of a press release, without a SINGLE follow-up question… that’s lazy. You are not serving your readers/listeners/viewers/ the public good. You’re serving the politicians by giving them a free campaign commercial.
Comment by Newsclown Friday, Oct 25, 13 @ 12:49 pm
@Rnug
Your point 2b from has always seemed a simple problem to fix. It seems to defy common sense. I always wondered why not require State salaries to be within %10 of the state average for the comparable title and experience. Give a Cost of Living Allowance to those in high expense areas but otherwise keep costs closer to market rates. Use National average for those without a private sector comparison. Gives the state some cushion to attract better talent while keeping the floor reasonable.
Comment by Mason born Friday, Oct 25, 13 @ 1:02 pm
Any time I hear “temporary tax increase” I assume that’s a typo that should read “permanent tax increase”.
Give the state’s financial picture, I think I’ll be right this time too.
Comment by titan Friday, Oct 25, 13 @ 1:10 pm
Mason born @ 1:02 pm:
I like your allowance idea; too bad the state doesn’t use it. Instead, you have people in high cost areas like Chicago being classified two or three titles higher than their actual job duties just for the pay level. And that artificially inflates their salary for pension purposes.
Part of what inflates the pay for lower job titles is the fact those (mostly union) titles get annual longevity raises (about 5% per step in my day) in addition to any cost of living raises. On the one hand, I understand removing an annual raise for doing a good job from political control but on the other hand it also rewards poor performers. That’s part of the problem, how to structure the pay system to reward the performers and also punish the slackers while removing any taint of political influence. I don’t really like the current system but it does beat pure patronage and political influence.
Comment by RNUG Friday, Oct 25, 13 @ 1:18 pm
“YOU are the reason for the tax increase.”
Very astute observation. Union members solely caused the state’s massive backlog of unpaid bills, just like they are solely responsible for the pension debt.
The state personal income tax is only 5%, compared with almost all of our neighbors, who have higher tax rates for higher earners. If you’re a high earner in Illinois, you should get a little perspective and not freak out so much, in my opinion.
Comment by Grandson of Man Friday, Oct 25, 13 @ 1:24 pm
==Further many people will argue (rightly or wrong, legally or illegally) that funding our schools at the levels that were “promised” and other critical social support programs are much more important than maintaining (perceived generous) pension programs unscathed while the rest of the state craters.==
Since the majority of the pension deficit is owed to teachers, and teacher compensation comprises most of education expenses, your solution is to pay future teacher compensation by defaulting on our obligation to pay teachers for services already rendered. Makes sense to me.
Comment by Anon. Friday, Oct 25, 13 @ 1:24 pm
PQ’s approach makes some sense. The internal battle over pension bills is probably in part because some Democrats want a large reduction so that they can claim that the tax increase can sunset after they pass bills on pension changes, shifting some normal costs, and expanding gambling, as well as throwing in some economic growth assumptions (and bad arithmetic). The pension changes have to come before anything else is passed; PQ has done is best to delay gambling expansion.
The big challenge is timing.
The pension cuts need to be passed before the election but not so soon that the court system can definitely void them before the election, because at that point the candidates can no longer pretend that the tax increase can sunset. Later when the ISC rejects the pension cuts, the legislature will extend the tax rate, assigning blame to the courts.
The complication is that pension cuts will cost them a lot of votes from the employees in those pension systems if there is no court decision until after the election. If a court tosses it before the election, then there may be some forgiveness on the part of the workers in the pension systems.
Optimal results and timing might be if a lower court decision voids the legislation before the election and if the lower court decision is on appeal at election time.
Comment by east central Friday, Oct 25, 13 @ 1:26 pm
In terms of salary there are attorneys who have over 20 years with the State who don’t make $100,000, the starting salary in small to midsize law firms. They gave up big pay for the whole benefit package, which included a pension of 1.67% of an averaged salary for each year worked and premium paid insurance after 20 years - Not excessive especially when you factor in that Illinois has the lowest per capita ratio of workers out of all fifty states making for heavy work loads and long hours.
Comment by retired and fed up Friday, Oct 25, 13 @ 1:26 pm
@RNUG
–I don’t really like the current system but it does beat pure patronage and political influence.–
I agree but to be honest the whole current system is set up IMHO to reward the non-technical union employee at the expense of technical Union and merit comp. Considering that it is the technical and merit comp staff that will be making the truly important decisions it seems almost designed to fail.
Comment by Mason born Friday, Oct 25, 13 @ 1:32 pm
Mason born @ 1:32 pm:
As a retired MC appointee, I agree …
Comment by RNUG Friday, Oct 25, 13 @ 1:35 pm
east central @ 1:26 pm:
good points on both the timing and the bad math … LOL!
Comment by RNUG Friday, Oct 25, 13 @ 1:36 pm
My comment above called for three points and listed five.
Talk about bad math!
Comment by walkinfool Friday, Oct 25, 13 @ 1:41 pm
@phlegm640& grandson of man.1st I was a union man all my life,and owned a union company for 40 years. Which is now still being run by my family.
This good cop bad cop act by Cullerton and Madigan
gets old after a while. If they wanted this game over would be over in a minute. In this weeks Trib Cullerton said we have no crisis, last year we had a crisis. What gives?
Our State is losing 5 MILLION dollars a day. And we act as if were Roman Senators debating just to debate.
Think of how many kids could be fed in a day with
5 million bucks. What about arts and music in schools and helping Vets. The whole lot of the should be sacked.
Comment by mokenavince Friday, Oct 25, 13 @ 2:17 pm
==My comment above called for three points and listed five.
Talk about bad math!==
It worked for the Spanish Inquisition!
Comment by Anon. Friday, Oct 25, 13 @ 2:20 pm
This is a easy question if the answer is “yes, let it expire”. Since it was not answered directly, we should assume the answer is “no”.
Can anyone answer: how many other states have either no income tax or a tax rate at 3% or lower?
Comment by Rudy Friday, Oct 25, 13 @ 2:48 pm
Seven states have no state income tax. However, when income is not taxed, the state has to make up for it’s lack of revenue by taxing other things, for example, property tax.
http://taxes.about.com/od/statetaxes/a/Highest-State-And-Local-Taxes.htm
Comment by Anonymous Friday, Oct 25, 13 @ 3:09 pm
Here’s a comparison although Illinois’ tax is outdated. If our state’s is incorrect because it is too low, I doubt any others that have changed have been lowered.
http://taxes.about.com/od/statetaxes/a/highest-state-income-tax-rates.htm
Comment by Anonymous Friday, Oct 25, 13 @ 3:12 pm
Thank you for responding.
Comment by Rudy Friday, Oct 25, 13 @ 3:17 pm
Residents of New York paid 12.8% of their income to taxes in 2012.
Comment by Anonymous Friday, Oct 25, 13 @ 3:23 pm
Well, healthy for him personally or not, Pat Quinn’s Obsession with the Pension Crisis issue (sorry Sen. Cullerton) remains alive and well!
Besides, what Leader or Politician wants to ever REALly talk about having to raise folks’ Income Taxes PERmanently–even when it’ll most DEFinitely be dearly NEEDED when the time comes in 2015?! After all, PQ MIGHT even be able to ride the Avoidance Approach or put differently, the “Well, Let’s wait and see ’till then–i.e. AFTER the ELECTION (and, he hopes obviously his RE-election)–to see if we really need to do that” Approach too!
After all, Hillary Clinton has bequeathed Pat Quinn “the Luckiest Politician” on the Planet EARTH, ya never know–taking such an Approach he of all People might actually be able to pull it OFF!! (And then with 4 more Years as Governor under his belt, safely go ahead and do what’s fiscally best and necessary for Illinois and make the Income Tax Increase permanent, of course, in 2015)…!
Comment by Just The Way It Is One Friday, Oct 25, 13 @ 3:52 pm
== I agree that it is possible that the income tax extension will not be passed ==
If that happens, the bond houses will surely downgrade Illinois as too big a credit risk. Of course that downgrade would not elicit a peep of concern from our business friends and their editorial allies who always blame pensions.
Comment by reformer Friday, Oct 25, 13 @ 3:59 pm
== Any time I hear “temporary tax increase” I assume that’s a typo that should read “permanent tax increase” ==
The first temporary tax hike under Big Jim did expire. The second one became permanent under Gov. Edgar.
Comment by reformer Friday, Oct 25, 13 @ 4:06 pm
mokenavince @ 2:17 pm:
The $5 million a day is basically the interest on money already legally owed to the pension funds. Unless the GA & Gov can figure a way to steal back already earned pension benefits, the taxpayers still have to pay it.
Comment by RNUG Friday, Oct 25, 13 @ 4:23 pm