Capitol Fax.com - Your Illinois News Radar » 2009

Wednesday, Oct 21, 2009 - Posted by Rich Miller

* Most of the Republican gubernatorial candidates appeared at a candidates’ forum at the Union League Club today and somebody asked a really inane question…

Asked where each would make specific cuts to trim more than $1 billion from the state’s multi-billion dollar deficit, Dillard, Brady and Schillerstrom each said they would first look at Medicaid, the state subsidized health-care plan for the poor. Proft said he would target funds to create high-speed rail between Chicago and St. Louis and the proposed third metropolitan airport near Peotone. Andrzejewski said he would look at the current share of state income taxes that go to local municipalities—an immensely difficult political move.

A billion dollars in cuts? Let’s see them come up with ten times that amount and then I’d be impressed.

The Senate Democrats popped an amendment into the Executive Committee last week which would’ve required all candidates for governor to propose their own state budget the same day as the governor unveiled his budget (in March, after the primary). I was pretty harsh on the SDems for that one last week, but maybe they have a point.

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Question of the day

Wednesday, Oct 21, 2009 - Posted by Rich Miller

* Which Republican gubernatorial candidate has the best chance of winning the general election? Explain your answer fully, please.

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Maybe the Tooth Fairy can bail us out

Wednesday, Oct 21, 2009 - Posted by Rich Miller

* The Paul Simon Institute has released more poll numbers which show just how difficult it is for policymakers to do anything dramatic these days. A large majority of the populace believes the fairy tale that the state deficit can be solved by “cutting waste and inefficiency.” That’s just absolutely ludicrous…

The state of Illinois has a budget deficit of over 12 billion dollars. I’m going to read three statements that people have made about how to fix the deficit, and ask you which one comes closest to your views.

Only a revenue increase can solve the state’s budget problems 9.5%
The budget problems can be solved by cutting waste and inefficiency 56.5%
A combination of budget cuts and revenue increases will be needed to solve the problem 27.3%
Have not thought about it 3.4%
No response/Don’t know 3.4%

It’s not surprising that people would think this, considering the horrific problems state government has had…

“Part of the problem for policy makers in Illinois is that many people don’t feel they get good value for state services,” [David Yepsen, director of the Paul Simon Institute] said. “There are 48 percent who don’t think the value of state services is very good. By contrast, 39 percent don’t think federal services are so good and 30 percent don’t think much of local services.”

But it’s an utter, complete fantasy to believe there is $12 billion in waste and inefficiency within state expenditures of about $30 billion.

* The only way to completely cut ourselves out of this mess is not to just cut into the bone, but to actually remove many of the bones. But since the majority believes in the fairy tale, they don’t want to make the painful cuts, either…

Do you favor or oppose cuts in state spending on:

Kindergarten through high school education? 13.0%

State Universities? 31.9%

Public safety, such as state police and prisons? 16.3%

Natural resources, such as state parks and the
environment? 32.0%

Programs for poor people? 20.4%

Pension benefits for state workers’ retirement? 39.5%

And because they believe in fairies, there’s no need to raise revenues, either…

I’m going to read several ways people have suggested for raising more money. For each one that I read, I’d like you to tell me whether you favor or oppose raising revenues in that way, OK?

Raise the state sales tax 21.4%

Expand the sales tax to cover services, such as dry cleaning or haircuts. 44.1%

Expand legalized gambling in Illinois 44.5%

Sell or lease state assets, such as the lottery or the Illinois toll road system 25.9%

* But a few more people are waking up to reality…

(T)here has been some public opinion movement since fall 2008, both on the revenue-enhancing side and the program-cutting side.

Last year, for example, 20.9 percent favored spending cuts for state universities; this year support grew to 31.9 percent. In 2008, 21.2 percent favored spending cuts for natural resources such as state parks and environmental services; in 2009 that increased to 32.0 percent.

In the Simon Institute’s 2008 poll, 28.4 percent favored expanding the state sales tax to cover services, such as dry cleaning or haircuts; in the 2009 poll, 44.1 percent approved. In a less dramatic result, 21.4 percent of those surveyed this year approved of raising the sales tax rate, up from 17.0 percent in 2008.

“These results may show that increasing numbers of voters have come to the conclusion that something’s got to give,” [Charles Leonard, the Simon Institute visiting professor who supervised the poll] said. “While most people still oppose both specific cuts and various tax increases, the continued media attention to the budget situation, and the daily realities of people losing their jobs and state services disappearing may be bringing people closer to the stark realities of funding state operations. I expect next year’s poll will demonstrate even more movement.”

Maybe.

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Monk flips on Blagojevich

Wednesday, Oct 21, 2009 - Posted by Rich Miller

* Keep in mind that when Rod Blagojevich was allegedly scheming to pad his own pockets, he was campaigning as a reformer who would clean up government…

Even before he was elected governor in 2002, Rod Blagojevich and three of his closest friends schemed about ways to enrich themselves by controlling state government, the former governor’s former chief of staff alleged as part of a plea agreement Tuesday with federal prosecutors.

When Blagojevich took office, his three friends became key players in his administration and met repeatedly with the governor to share moneymaking ideas and get updates on their plans to bring in hundreds of thousands of dollars that they could split up later, former top aide Alonzo “Lon” Monk alleged.

Monk, who also was a groomsman at Blagojevich’s wedding and twice his campaign manager, pleaded guilty in the sweeping corruption case and agreed to testify against the former governor in exchange for a recommended sentence of two years in prison.

Interesting…

Monk said he met with Blagojevich, Rezko and Kelly periodically in the early days of the administration to discuss ways of using state power to make money. But he said the meetings stopped abruptly in 2004 after they learned that FBI agents were questioning big-money campaign contributor Stuart Levine — who later became the government’s star witness at Rezko’s influence peddling trial.

But the lawlessness never stopped…

…[Monk] admits that he schemed with Blagojevich to shake down a racetrack businessman for a $100,000 campaign contribution in exchange for the governor’s signature on a pending piece of legislation.

Rezko, he said, delivered $10,000 in cash payments to him seven to nine times. Monk “understood that the money that Rezko provided was a gift, not a loan,” the plea states.

Monk also claims that Blagojevich, Rezko and Kelly met about making money off of a 62-acre parcel at Roosevelt and Clark that Rezko owned.

“Rezko talked about different ways that [Monk], Blagojevich, and Kelly could benefit from the Roosevelt and Clark Project, such as by having Blagojevich’s wife work on marketing the project or by allowing [Monk] to work on the project after [Monk] left state government,” the plea states.

If you think campaign finance reform would’ve prevented this insanity, you’re wrong…

Monk, who served as liaison with the state’s Office of Management and Budget on the pension deal, alleges that Kelly and Rezko “pushed” him to choose Bear Stearns, which is identified only as “Investment Firm A” in the plea agreement, for the first tranche of bonds.

At the time, the state intended to break up the $10 billion into several sales. Monk understood that Kelly and Rezko were pushing for Bear Stearns because the firm would either make a contribution to Blagojevich or because the governor, Kelly, Rezko, and Monk would “make money.” The firm could not make a direct contribution under regulatory bans on such payments from bond underwriters.

More on that alleged scheme involving Individual A, who is believed to be Springfield consultant Bob Kjellander…

Monk “learned from those conversations that Individual A, who Defendant (Monk) understood either had received or was going to receive money from Investment Firm A for acting as a consultant on the POB (Pension Obligation Bond) deal, was going to give Rezko $500,000 that would be held in a separate account,” the plea agreement states. “Defendant understood that the $500,000 payment was for the help that Rezko had provided to Investment Firm A and Individual A relating to the POB deal, and that the money would later be split between Defendant, (then-Gov. Rod) Blagojevich, Rezko, and Kelly.”

Kjellander in 2003 received $809,000 as a consulting fee for helping Bear Stearns & Co. get the lead underwriting role for the $10 billion bond issue. […]

“I do know that I did not participate in any scheme and I have not committed any crime. I never made any contributions to Mr. Blagojevich’s campaign, and never considered doing so.

“I never gave money to Chris Kelly,” [Kjellander] added. “I have met Mr. Monk and I know Mr. Rezko, but I did not involve myself in any conspiracy to give them money.

Let’s play “Blame the dead guy”…

Blagojevich defense lawyer Sheldon Sorosky called Monk’s allegations “absurd.”

“It’s completely false that Rod Blagojevich ever participated in any meetings or conversations where Tony Rezko and Chris Kelly talked about how they could make money illegally,” Sorosky said.

Read Monk’s plea agreement by clicking here.

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