In an exclusive interview last week, CME Group Executive Chairman Terry Duffy said he’s more than ready to leave Illinois if he doesn’t get what he believes is a “fair” tax deal from the General Assembly.
The company owns the Chicago Board of Trade and several other firms. It’s a very big wheel in this state and leaving would be the worst sort of news for Democrats who raised taxes this year.
Duffy has been under intense pressure all year from Wall Street to reduce expenses. State taxes are listed as expenses on corporate books, so Duffy has been publicly fuming about his company’s $150 million a year state tax burden since corporate tax rates were increased.
Duffy claims CME pays 6 percent of all corporate income taxes here, and pays more than any other company. “I don’t know another company in the world that pays 6 percent of another state’s taxes.”
As recently as four years ago, the vast majority of CME’s trades were physically handled on the floor of his exchanges like the Chicago Board of Trade. Now, almost 90 percent of trades are performed electronically, and Duffy says that difference means CME shouldn’t be paying taxes on trades which are obviously originating in other states and other countries. Trouble is, he won’t (and insists he can’t) reveal exactly where those trades are originating, so state negotiators instead decided to reduce his tax burden by roughly two-thirds, which means $100 million a year less in state income taxes paid by CME.
Duffy said he’d talked to at least half of the General Assembly’s members in the past several days, many of whom said they wanted something else in exchange for helping his company, like tax breaks for other industries.
“I really think these people don’t believe that I have an alternative,” a defiant Duffy said, pointing to very generous offers from other states.
The executive chairman claimed he’s been offered as much as $600 million to move Aurora’s high tech center and mentioned a report about how Indiana Gov. Mitch Daniels had offered CME $150 million a year in tax relief — CME’s entire state tax burden. When reminded that Gov. Daniels had denied the offer was made, Duffy said “The governor denied the number, but he didn’t deny the discussions. My shareholders heard it. They’re going to say, ‘What the hell did you do that (stay in Illinois) for? We care about us.’ ”
I’ve criticized Duffy for waiting until after his taxes went up to complain about how his company had historically been mistreated by the state’s tax code. This year’s tax hike cost CME $50 million, but Duffy wants double that amount to stay put. Since he didn’t seem to care about his taxes until January, why should the state give him anything beyond what the tax hike cost the company? Duffy claimed he’d been working on the situation for at least two years. He said he didn’t think he needed to make anything public until he was forced to when he was asked about the tax hike during a shareholders’ meeting.
However, Duffy said he hadn’t met with the governor or anyone else here before the tax hike. “Why work with Illinois when other states have a more business friendly approach?” he asked.
And as to why CME refuses to offer anything tangible in return for its tax deal, like all other companies seeking tax relief have to do, Duffy said he doubted the legality of those agreements. If Motorola broke its subsidy deal, Duffy said, it’s doubtful there’d be any real legal ramifications. “We’ve been here 163 years,” Duffy said. “We think we’ve demonstrated that we’re good corporate citizens. I can’t tie my shareholders’ hands like that.”
But if CME is such a good corporate citizen, why demand all that cash when Duffy knows the state budget is still so tight? I mentioned a recent $4.6 million state cut to homeless services which has resulted in tens of thousands of people being turned away from shelters. “I’m not asking the state for $100 million,” Duffy said, “I’m asking to give me a rule to say this is what I think is being traded in Illinois and here’s what I’ll pay, whatever the tax rate will be.”
CME, Duffy said, has averaged 19 percent growth for 30 years. “I pay people and they pay taxes and that money can go to the homeless shelters.”
He didn’t make it sound as harsh as it looks, but it’s an argument he has to deal with.
* It wasn’t covered by the media, but the CME tax cut and the company’s Chicago TIF money were a major focus of Occupy Chicago’s interruption of Wisconsin Gov. Scott Walker’s Union League Club speech last week. Watch…
The “mic check” is necessary in New York because the city bans megaphones on public streets. It’s kinda creepy and weird when the occupiers use it when they don’t have to. The call and repeat sounds almost cultish to my ears. But, tactically, it works well when you’re trying to shout down somebody who has a “real” microphone.
Oberhelman shared a story of a recent Asian business summit in China. Two Chinese businessmen asked why Caterpillar maintains its business presence in Illinois, with the state’s well-documented corruption and high business costs.
The question angered Oberhelman. When he returned to the U.S., he said he fired off a letter to Gov. Pat Quinn. To this point, it hasn’t done any good.
“Our biggest, most important plants are rooted here,” he said when an audience member pressed him on why Caterpillar does stay in Illinois. “From a corporate standpoint, it would be hard to uproot 4,000 engineers from our Peoria headquarters.”
He paused a moment and added, “But that doesn’t mean it’s forever.”
It hasn’t done any good at all? Really? The workers’ comp reforms this year weren’t completely to Cat’s liking, but the Illinois Manufacturers’ Association was in full support, as were other business groups and most Senate Republicans. It’s done some good. And what about all those kind words Oberhelman had for Illinois this past spring?…
“We’ve got a lot of good things going for us in Illinois,” [Oberhelman] said.
While Oberhelman’s letter informed Quinn of offers by four other states that sought to lure Caterpillar from Illinois, the CEO reaffirmed his commitment to the state. “Cat is here to stay. We’ve got 23,000 manufacturing jobs in this state.” [..]
Regarding the increase in the state income tax that Caterpillar said would cost its employees $40 million this year, Oberhelman called the increase “inevitable” since the state’s “(economic) hole is so deep.”
Business interests played a key role in the most significant restructuring of the corporate income tax code of the past decade or so, when the state restricted the tax to profit stemming from in-state sales and eliminated property value and payroll size from the formula.
The move cut tax bills of Illinois-based manufacturing giants and other multinationals, whose sales are spread worldwide. The cost to the state has been an estimated $100 million annually, [House Majority Leader Barbara Flynn Currie] said.
Proponents had projected the change would spur 285,000 new manufacturing jobs. Instead, the sector’s employment shrank to about 600,000, down from as many as 800,000 when the legislation took effect.
Cat was the number one cheerleader behind that change to the single-sales factor, which cut the company’s state tax burden down to almost nothing. Instead of adding workers like it promised, though, the company has cut back here and created new jobs in union-hostile states and in China. All Illinois really did was essentially subsidize Cat’s gradual move out.
* CME’s boss is angry, Cat’s boss is angry and the occupiers are angry about the taxpayer help already given to CME and Cat. Heck, even Mother Tribune is sounding a little occupyish these days…
Through what tortured logic, then, was it necessary for taxpayers to gift the Sox with a steakhouse? The sports authority spent $7 million to build and equip Bacardi at the Park, adjacent to the stadium. The Sox get the proceeds. Why? Because nobody at the table was looking after the taxpayers.
“We said to Jerry, ‘Jerry, can we have part of the profits?’” Thompson told the Tribune’s Jared S. Hopkins. “And he said no. We said OK.”
Think about that a minute. In 1988, Reinsdorf got his way by saying or else. This time all he had to say was no. […]
Gov. Pat Quinn has already replaced the board members who serve as his appointments. Mayor Rahm Emanuel ought to do the same. It’s time we stacked that board with people who don’t have trouble remembering whose interests they’re supposed to represent. Hint: It’s not Jerry Reinsdorf.
* Related…
* Saving jobs focus of brewing Illinois tax deal: “If you’re going to see broad-based changes, it’s going to take a lot of work and a lot of time,” said Todd Maisch, vice president of government affairs for the business representative group, the Illinois Chamber of Commerce. Maisch said lawmakers are expected to vote on the CME tax package next week during the final week of the fall veto session, but he said he doesn’t believe the legislators will begin working on major tax reform until 2013. Until then, Maisch said, Illinois businesses are going to have to live with the reality that the state’s tax code does play favorites. “If you’re a dry cleaner and a third of your customers work at Sears, you are happy with this (package)” Maisch said. “If you have a cleaning contract with CME, then you are happy about this. But if you’re a small business that is not directly tied in, then you are feeling jilted. No doubt about it.”
* Time for a level-headed approach to business, taxes: “One of the problems in economics is the seen versus the unseen,” the Tax Foundation’s Robyn said. “We see a big corporation leave our state and take 1,000 jobs, and that’s very visible and we say, ‘We’ve got to keep those jobs here.’ But what you don’t see is when those 1,000 jobs leave, what other opportunities open up in the state or, more importantly, if you buy them off and give them all this money to stay, what you don’t see is the opportunity you lost with that revenue. You could have used that money for something else.”
According to Crain’s Chicago Business,Illinois’ effective business tax rate compares very favorably with our neighbors.
With both Speaker Madigan and Leader Cross bidding for CEO affection, corporations in Illinois are seizing the opportunity to get a few million more dollars for themselves.
Forget the fact that the State desperately needs revenue, that corporate profits are up, and that there is no evidence that tax breaks create jobs, just give them the money.
If some companies are paying too much, then do tax reform. Simply cutting taxes does not solve the state’s problem.
isn’t this just the manifestation of what we are seeing on the national level? Our political leaders (state and national) are picking the “winners” and “losers”. This is exactly what Quinn and company like. Unfortunately, everyone is now bellying up to the bar to be served.
The “waivers” being handed out on Obamacare are a perfect example. Some firms get them and others don’t. I called Senator Durbins office seeking Obamacare waivers for the three different companies I am affiliated with (more than 400 employees). They wouldn’t even call me back. I guess I’m not a “winner” in Durbins eyes.
i truly love all the hemming and hawing about the CME. if the CME leaves, there is no place they can go where they will have access to the bandwidth that chicago does. IF the CME wants to be the digital exchange, then access to the bandwidth that chicago provides is absolutely crucial to its success.
it’s much more difficult to access after 9-11, but chicago has more backbone bandwidth than silicon valley or new york city. and if the CME wants to walk away from it, you can be sure that (eventually) someone will come along and take advantage of that infrastructure advantage to make trades a split-second faster.
of course, having said all that, it speaks to the absolute backwardness of illinois’ tech sector that it doesn’t have mass server farms and other tech infrastructure posed to take advantage of the same backbone advantage. a decade ago, the chicago board was bragging about its access and promised to use this bandwidth to turn itself into the premiere digital exchange. it’s done that. if they want to walk away, they’d be idiots. and they would be replaced. no one is going to put more OC-12s in the ground.
it amazes me just how profoundly stupid illinois is about this valuable resource. our high schools don’t produce kids who can thrive in an internet-based economy. our colleges thrive in traditional sectors, many of which are consistently losing jobs. saving the CME needs to be put in this context. CME has succeeded not because illinois is “business friendly” but because illinois sits at a hidden crossroads that allows it to move faster than anyone else. they didn’t build the backbone (or the internet), government did. let’s remember that…
** I called Senator Durbins office seeking Obamacare waivers for the three different companies I am affiliated with (more than 400 employees). They wouldn’t even call me back. I guess I’m not a “winner” in Durbins eyes.**
Durbin doesn’t grant waivers. HHS does. Did you submit waiver applications? And waivers are not granted randomly. You need a reason to get a waiver. And “I don’t want to” isn’t a sufficient reason for a waiver.
That was a really good interview with duffy. That last line about the homeless is exactly the kind of off message comment I am sure he is instructed NOT to make so you got through the spin and it was pretty revealing about what those guys really think.
The white sox thing is shameful. Reinsdorf is willing to eat an NBA season, not pay the people that make minimum wage to clean the seats and toilets after the game and the state that has no money for the homeless is buying him a restaurant?
–Two Chinese businessmen asked why Caterpillar maintains its business presence in Illinois, with the state’s well-documented corruption and high business costs.–
Lectures on corruption from the Chinese? Who’s supposed to believe that? You’re not in business in China until you pay off some party hack or tinhorn general. And they can put you out of business in a heartbeat, and you have no recourse in rule of law.
Copyright and trademark theft, intellectual property theft and cybertheft are POLICIES of the Chinese Communist Party. And we’re supposed to believe they’re giving lectures on corruption and a corporate CEO is taking it seriously?
–CME, Duffy said, has averaged 19 percent growth for 30 years. “–
And in such an unfriendly business environment, too. Maybe you should think a little bit before you directly contradict yourself.
CME announced profits for the third quarter of this year — post-tax-increase — that were 29% higher than last year — pre-tax-increase.
You say your what hurts?
Search the international financial press and you won’t read oogots about CME moving or the state’s unfriendly business climate. That’s gruel for the local chumps. Everywhere else, they talk about making money hand over first.
And somebody’s offered $600 million to relocate the Aurorora co-location that you just built and is not even fully online yet?
The ultimate answer is to foster a climate for ALL business so there is no need to even consider special deals. But Illinois’ politics seems to preclude this. (sigh).
Does Duffy have any PR counsel at all? Does he have half a brain? Did he suggest that his employees taxes buy cake for homeless shelters?
I would point him to Lemony Snicket’s comments on Occupy: “11. Historically, a story about people inside impressive buildings ignoring or even taunting people standing outside shouting at them turns out to be a story with an unhappy ending.”
Let me tie all of todays posts together….
Duffy and his gamblers in the top 1 tanked the economy and that ruined the state budget and now by not taking personal responsibility they want more deals and blame the state workers and the 99 percent
- CircularFiringSquad - Monday, Nov 7, 11 @ 9:34 am:
If Duffy has PR folks he should get a refund to help pay for the out of state golf outings held by his lobbos beg for millions.
Capt Fax:
when you write about CME and its 163 glorious years in IL you should write this was once a mechanism for farmers and their bankers to buy a little peace from weather, critters and other maladies.
CME has created zillions of millionaires who seem quite comforatable in Lake Forest, Inverness and even Lemont. Seems unlikely they will fit in looking for three martini lunch spots in Schererville or Gary. See they have not told the “little women” that all the action happens on the internet and it allows them to get out of the house.
Perhaps we will run out an option some bankrupt fixer upper golf courses and riding stables as a hedge.
Now of course CME is at the heart of the quant-based,go-go, highly leveraged derivitives biz that along with the predatory lenders and their allies help destroy the current world economny, spawn the “Occupy” and force bank bullies like BofA to pull back from their screw the consumer debit card fees.
TeeTimeDuffy failed to have his accountants plan an orderly shift of tax dodging and now wants IL to pay for his blunder.
It will be very interesting to see if IL falls
Fire, Aim, Ready
Ummm, if you are talking about the mortgage stuff those were not cleared products. Not traded on any exchange in Chicago for the most part. But yeah blame the CME
Long term economic trends are pointing to perhaps decades of stagnant wage growth (i.e. starting in the 1980s) for most middle class Americans. No longer are Americans able to count on rising home values to bailout stagnate incomes and the voter back lash from this realization is just beginning. Obviously, CAT CEO Oberhelman, who takes his tax policy advice from communist China and CME Chairman Duffy don’t agree with Oliver Wendell Homes when he said “Taxes are the price we pay for a civilized society.” If the economic elite keep up with this “Let’em eat cake attitude,’ there won’t be enough lamp posts in America for the political necks on the line.
As for the workers compensation reforms, CAT was one of the biggest beneficiaries. As a self-insured company, the reduced fee schedule affects their bottom line directly (they don’t have to be concerned whether or not insurance costs go down). The medical portion of their claims paid got slashed 30%. And that’s just 1 of the many reforms that help CAT.
I am no fan of Duffy, but…2 bored; the reason
Chicago has the bandwidth is because of business and esp CME. Business will follow business. Do you really think the bandwidth providers won’t follow a big fish like CME wherever they go? @ Western Il: Gambling yourself aren’t you? easy to point finger at economy problems through CME “gambling” but what are you doing by daring them to leave? Best solution, do what is needed to keep them until another solution to replace them is available. Don’t cut off the nose to spite the face. Plan
Easy there Plutocrat03…steakhouses are an important part of Illinois’ economy…
Where else is Governor Thompson going to go to talk to others about the $100,000 duck decoy he bought last summer?
- downhereforyears - Monday, Nov 7, 11 @ 11:03 am:
CME should leave the state. This whole system is unfair to a business like theirs. Everyone cry and moan about how unfair they are being…..while the moving trucks jump on the Dan Ryan.
–“We said to Jerry, ‘Jerry, can we have part of the profits?’” Thompson told the Tribune’s Jared S. Hopkins. “And he said no. We said OK.”–
Given the bald payout to someone who didn’t need it, given the situation, given the players, given their history, that has to be a nominee for Incredible (in every sense of the word) Quote of the Year.
The mortgage mess that was created by well intended poorly thought out laws that forced banks to give mortgages to people who shouldn’t be getting them. The CME had nothing to do with that. But why let that get in the way of a good rant. Maybe we could start actually blaming the lawmakers who created this problem. You know madigan cullerton Emil jones Blago Quinn. Spending billions more than you have is criminal.
Ah, so Downstate brings out the bogus Republicon “picking” argument.
OK, lets go with that in the current context. CME stock has declined over the past year, and at about $250/share now is way in the red after hitting oer $700/share at the top of the market in 2007. Now he wants a tax break-presumably to help his sorry stock price.
Of course, you don’t mention that…only something about waivers and Durbin.
Funny that its always Dems accused of “picking winners and losers” in the market - when its the big time free maketeers like Mr. Duffy that fix the system so they (the 1%) win and the rest of lose.
(P.S. I wonder if Duffy has loaded up on put options for his own stock if he doesn’t “win” this one! LOL)
Illinois is like a 60 year old prom queen who discovered that her husband has a roving eye. Complain all you want and justify why you do not think businesses need to be accommodated but just be prepared when they take an interest in the others.
Illinois has gotten fat sloppy and comfortable. And quite unattractive.
I bet this old prom queen had forgotten where the gym even is.
If the CME leaves Chicago over millions of dollars, my guess is that the Illinois delegation gets a whole bunch more enthusiastic about a transaction tax quickly.
The CME goes to a Republican state? The ultra-rich already have the Republican votes to opposes a transaction tax.
What’s keeping the transaction tax off the table is the ultra-rich have the support of the Democrats who represent Illinois, New York, Connecticut and New Jersey.
If the CME moves (something I’m exceedingly skeptical rich people on the North Shore and west burbs are going to support), there will be far more taxes levied than this squabble is about.
You found it interesting to try to get a free ad on CapitolFax?
You found it interesting you got a fundraiser e-mail, just put your e-mail up here and there are several folks here who deal with candidates who will be more than happy to see you get more interesting e-mail.
The e-mail does have a copyright notice (you included it) since you are not reporting news per se IMHO nor are you making saterical or critical comment it seems to me you are breaking the Will County Central Committee’s copyright.
- western illinois - Monday, Nov 7, 11 @ 11:37 am:
The mortages being created were for bond packages that Wall Street firms sold as gold and then betted against. True CME doe not sell CDSs but they sell other junk we would be better off without .
I have suggested a “financial” “products” Tranaction tax on Illinois residents . That money can be used for education,incentives for manufacturing…including CAT and others,education,infrastructure,the pensions and so on and if like cigarettes we gamble less so be it. The CME leaves good riddance
This is an aside, but I just heard that AFSCME lost in court this morning when it tried to get an injunction against layoffs. The layoffs I think have something to do with the possible closure of Tinley Park mental health center and employees bumping others in the layoff process. Four people in my office got layoff notices last week.
“Downstate” has it right. Special interest tax breaks for big corporations that can lobby and spread around millions in campaign cash create an environment of corruption and crony capitalism! The government ends up picking the “winners” via tax incentives, and creates “losers” who must pick up the tax revenue slack by paying ever higher taxes. Why is it so difficult to process the economic reality of a lower tax rate equally applied to all would produce greater revenues for the state coffers? I don’t blame the big boys for trying to get lower tax rates, I just think they should be applied to ALL BUSINESSES regardless of size through tax reform.
VMan, I’m sure you enjoy whiling your days away dreaming of old prom queens and such, but those of us in business consider cold facts.
CME, from a business standpoint, has no leverage for this break.
In it’s own words, has grown here by annualized rate of 19% a year for thiry years. It has grown into the largest derivative market in the world, with excellent profits that dwarf any increase in state income tax.
If you’d their own published material, you’d see projections of record profits for far as the eye can see and no mention of moving anywhere.
They have a huge human and capital investment here, that they just upped considerably by spending years and millions building a 428,000 square-foot co-location in Aurora that’s wired to the hilt.
The only other exchanges closely resembling their business model are located in the some of largest and highest-cost-of-living cities in the world.
So CME doesn’t have any leverage from a business standpoint for this holdup. Their leverage is in the form of friendly, powerful politicians who will ram this chump-change break down the rest of our throats while others wax ridiculous on prom queens.
Big Jim didn’t stop the clock. Powerful as he may have been, he NEVER controlled the House and his attempt to take over the Senate was stopped in court.
Regarding the “junk” CME sells that we’d be better off without. You mean like corn and soybeans? CME is influential in setting the price that the rest of this agricultural state bases its livelihood on. The Trib keeps telling me farmers are making out like bandits these days. I’m not so convinced, but surely they wouldn’t steer me wrong on economics.
One other comment on CME and the communications infrastructure: sure, when they move to Indianapolis, someone will come in to expand the telecom system there to accommodate them. But if they have any downtime whatsoever in the switchover, they have just handed their keys over to the Frankfurt Exchange.
Good luck getting your Colts PSLs!
- Cook County Commoner - Monday, Nov 7, 11 @ 12:49 pm:
There are only two ways to deal with Illinois politicians: with threats or with cash. Government employee unions get what they want by giving cash, requiring members to give cash and other campaign assistance and helping the chosen get investment seed money from pension funds. Big businesses get what they can by threats to move, which would leave politicians with egg on their face, angry unemployed voters and diminished re-election prospects. Others with less size and cash do what they can with the Springfield kleptocrats. The rest of us are just observers queued up to be served up at the Roadkill Cafe.
Interesting analogy VMan. So it’s the “wife’s” fault that the “husband” has a roving eye and you’re saying this is analogous to it’s the State’s fault that CME wants to leave. “Going to the gym” I suppose is analogous to improving the state’s financial picture then.
In other words, men who break their vows and cheat on their spouses should be absolved because their prom queen wives have gotten older and their looks have faded. Nice sentiment from a traditionalist. Sort of like Pat Robertson saying it’s OK to divorce a spouse with Alzheimers. What’s wrong with you VMan?
It seems to me a tradtionalist would find the thought that CME wants to break its vows rather contemptible. Instead, VanillaMan thinks it’s perfectly OK, even expected, for husbands to dump older wives for younger, prettier women. And we wonder why the institution of marriage is threatened, just like we wonder why America isn’t the pinnacle of the civilized world anymore.
We used to call men who dumped their wives Cads. What do we call companies who feel no obligation to the states that have stood by them for decades? Isn’t violating a social contract the same thing as violating a marriage vow?
- CircularFiringSquad - Monday, Nov 7, 11 @ 1:35 pm:
NO ONE fprced the banks to do no doc loans to the unqualified, send the hustlers, brokers and appraisers out every year to do bigger loans and bigger HELOC. CME and its friends are all around leveraged debt instruments that helped create what the WSJ called the credit crunch now has the world economy teetering on a smaller amount of Greek debt than the US govt gave to AIG.
It would be nice of commenters drop the Rush/Beck rant points they have been off the mark for several years now
I just ran into the premiere Rich Miller look alike at Clark & Jackson headed south towards Van Buren. I was afraid at first that it was you and you would get there right at the same time that they were starting to lock people up.
Duffy is having to deal with shareholders, and they are asking “Why” (among other things). You can say they are being greedy (probably are, IMO), but that’s an opportunity for other states. And they are going to go full force to land an operation like CME.
You can pretty much tell that Duffy doesn’t want to leave. Maybe, just maybe that’s the reason for some of his comments. But the decision is not his alone - he has constituencies he also has to answer to. Did anybody ever think about how much dollars and influence the different CME players provide to our varied cultural and sporting venues here in Chicago?
If the CME decides to go elsewhere, a portion of the tech infrastructure will follow - quickly. The CME is a player - and people will relocate for that level of business. Happens all the time.
I always remember back in the 1980’s when CAT built TWO of the most modern, automated foundries in the world (Mapleton, IL) -and- at almost the same time, a vast expansion of the nationwide parts center at Morton, IL (literally built a multi-lane tunnel under I-74 for automated parts retrieval) and completely built the building structure North of the Interstate.
Fast forward to today: Mapleton II basically has weeds growing in the parking lot (all ready to go; never opened) and Morton Parts North is just a memory - all gone. Big, big money. Btw, CAT in the last 2 years just opened a couple of large new parts centers outside of IL.
So, it can and does happen. Just because CME has made the investment in Aurora doesn’t mean that they are stuck here.
LisleMike: you’d have a valid point IF that backbone bandwidth didn’t exist before CME even considered going digital. the backbone wasn’t built for CME and it won’t be expanded in Indianapolis unless CME pays for it. if it has the millions for that, then it really won’t mind paying its taxes…
“VanillaMan thinks it’s perfectly OK, even expected, for husbands to dump older wives for younger, prettier women. And we wonder why the institution of marriage is threatened”
Since it’s wail on VanillaMan day and just in case he ever uses that analogy again, maybe we should also ask whether the institution of marriage is threatened when men dump their younger, prettier wives for old prom queens, too.
VMan, write yourself another note: Try bringing an informed opinion to the game sometime, rather than just using it as a forum for holier-than-thou rants.
- truthteller - Monday, Nov 7, 11 @ 5:39 am:
According to Crain’s Chicago Business,Illinois’ effective business tax rate compares very favorably with our neighbors.
With both Speaker Madigan and Leader Cross bidding for CEO affection, corporations in Illinois are seizing the opportunity to get a few million more dollars for themselves.
Forget the fact that the State desperately needs revenue, that corporate profits are up, and that there is no evidence that tax breaks create jobs, just give them the money.
If some companies are paying too much, then do tax reform. Simply cutting taxes does not solve the state’s problem.
- Downstate - Monday, Nov 7, 11 @ 7:09 am:
isn’t this just the manifestation of what we are seeing on the national level? Our political leaders (state and national) are picking the “winners” and “losers”. This is exactly what Quinn and company like. Unfortunately, everyone is now bellying up to the bar to be served.
The “waivers” being handed out on Obamacare are a perfect example. Some firms get them and others don’t. I called Senator Durbins office seeking Obamacare waivers for the three different companies I am affiliated with (more than 400 employees). They wouldn’t even call me back. I guess I’m not a “winner” in Durbins eyes.
- bored now - Monday, Nov 7, 11 @ 7:15 am:
i truly love all the hemming and hawing about the CME. if the CME leaves, there is no place they can go where they will have access to the bandwidth that chicago does. IF the CME wants to be the digital exchange, then access to the bandwidth that chicago provides is absolutely crucial to its success.
it’s much more difficult to access after 9-11, but chicago has more backbone bandwidth than silicon valley or new york city. and if the CME wants to walk away from it, you can be sure that (eventually) someone will come along and take advantage of that infrastructure advantage to make trades a split-second faster.
of course, having said all that, it speaks to the absolute backwardness of illinois’ tech sector that it doesn’t have mass server farms and other tech infrastructure posed to take advantage of the same backbone advantage. a decade ago, the chicago board was bragging about its access and promised to use this bandwidth to turn itself into the premiere digital exchange. it’s done that. if they want to walk away, they’d be idiots. and they would be replaced. no one is going to put more OC-12s in the ground.
it amazes me just how profoundly stupid illinois is about this valuable resource. our high schools don’t produce kids who can thrive in an internet-based economy. our colleges thrive in traditional sectors, many of which are consistently losing jobs. saving the CME needs to be put in this context. CME has succeeded not because illinois is “business friendly” but because illinois sits at a hidden crossroads that allows it to move faster than anyone else. they didn’t build the backbone (or the internet), government did. let’s remember that…
- Dave - Monday, Nov 7, 11 @ 7:47 am:
** I called Senator Durbins office seeking Obamacare waivers for the three different companies I am affiliated with (more than 400 employees). They wouldn’t even call me back. I guess I’m not a “winner” in Durbins eyes.**
Durbin doesn’t grant waivers. HHS does. Did you submit waiver applications? And waivers are not granted randomly. You need a reason to get a waiver. And “I don’t want to” isn’t a sufficient reason for a waiver.
- Shore - Monday, Nov 7, 11 @ 7:57 am:
That was a really good interview with duffy. That last line about the homeless is exactly the kind of off message comment I am sure he is instructed NOT to make so you got through the spin and it was pretty revealing about what those guys really think.
The white sox thing is shameful. Reinsdorf is willing to eat an NBA season, not pay the people that make minimum wage to clean the seats and toilets after the game and the state that has no money for the homeless is buying him a restaurant?
- Downstate - Monday, Nov 7, 11 @ 7:58 am:
Dave,
I simply asked Durbin’s office to help me through the process - you know “constituent services”.
- wordslinger - Monday, Nov 7, 11 @ 8:16 am:
We’ve moved into the theater of the absurd.
–Two Chinese businessmen asked why Caterpillar maintains its business presence in Illinois, with the state’s well-documented corruption and high business costs.–
Lectures on corruption from the Chinese? Who’s supposed to believe that? You’re not in business in China until you pay off some party hack or tinhorn general. And they can put you out of business in a heartbeat, and you have no recourse in rule of law.
Copyright and trademark theft, intellectual property theft and cybertheft are POLICIES of the Chinese Communist Party. And we’re supposed to believe they’re giving lectures on corruption and a corporate CEO is taking it seriously?
–CME, Duffy said, has averaged 19 percent growth for 30 years. “–
And in such an unfriendly business environment, too. Maybe you should think a little bit before you directly contradict yourself.
CME announced profits for the third quarter of this year — post-tax-increase — that were 29% higher than last year — pre-tax-increase.
You say your what hurts?
Search the international financial press and you won’t read oogots about CME moving or the state’s unfriendly business climate. That’s gruel for the local chumps. Everywhere else, they talk about making money hand over first.
And somebody’s offered $600 million to relocate the Aurorora co-location that you just built and is not even fully online yet?
Take it. See you later.
- JustaJoe - Monday, Nov 7, 11 @ 8:53 am:
The ultimate answer is to foster a climate for ALL business so there is no need to even consider special deals. But Illinois’ politics seems to preclude this. (sigh).
- Lakeview - Monday, Nov 7, 11 @ 9:02 am:
Does Duffy have any PR counsel at all? Does he have half a brain? Did he suggest that his employees taxes buy cake for homeless shelters?
I would point him to Lemony Snicket’s comments on Occupy: “11. Historically, a story about people inside impressive buildings ignoring or even taunting people standing outside shouting at them turns out to be a story with an unhappy ending.”
http://files.neilgaiman.com/mirror/111017162300/occupywriters.com/by-lemony-snicket.html
Have fun in Indianapolis, Mr. Duffy!
- western illinois - Monday, Nov 7, 11 @ 9:19 am:
Let me tie all of todays posts together….
Duffy and his gamblers in the top 1 tanked the economy and that ruined the state budget and now by not taking personal responsibility they want more deals and blame the state workers and the 99 percent
- CircularFiringSquad - Monday, Nov 7, 11 @ 9:34 am:
If Duffy has PR folks he should get a refund to help pay for the out of state golf outings held by his lobbos beg for millions.
Capt Fax:
when you write about CME and its 163 glorious years in IL you should write this was once a mechanism for farmers and their bankers to buy a little peace from weather, critters and other maladies.
CME has created zillions of millionaires who seem quite comforatable in Lake Forest, Inverness and even Lemont. Seems unlikely they will fit in looking for three martini lunch spots in Schererville or Gary. See they have not told the “little women” that all the action happens on the internet and it allows them to get out of the house.
Perhaps we will run out an option some bankrupt fixer upper golf courses and riding stables as a hedge.
Now of course CME is at the heart of the quant-based,go-go, highly leveraged derivitives biz that along with the predatory lenders and their allies help destroy the current world economny, spawn the “Occupy” and force bank bullies like BofA to pull back from their screw the consumer debit card fees.
TeeTimeDuffy failed to have his accountants plan an orderly shift of tax dodging and now wants IL to pay for his blunder.
It will be very interesting to see if IL falls
Fire, Aim, Ready
- x ace - Monday, Nov 7, 11 @ 9:43 am:
In 38 words Western Illinois says it well and says it all.
- OneMan - Monday, Nov 7, 11 @ 9:45 am:
Ummm, if you are talking about the mortgage stuff those were not cleared products. Not traded on any exchange in Chicago for the most part. But yeah blame the CME
- Plutocrat03 - Monday, Nov 7, 11 @ 10:16 am:
Former Governor Thompson’s defense of the steakhouse in the Thrib made me want to find something heavy to throw at the wall.
Makes me want to occupy something……
- Louis Howe - Monday, Nov 7, 11 @ 10:18 am:
Long term economic trends are pointing to perhaps decades of stagnant wage growth (i.e. starting in the 1980s) for most middle class Americans. No longer are Americans able to count on rising home values to bailout stagnate incomes and the voter back lash from this realization is just beginning. Obviously, CAT CEO Oberhelman, who takes his tax policy advice from communist China and CME Chairman Duffy don’t agree with Oliver Wendell Homes when he said “Taxes are the price we pay for a civilized society.” If the economic elite keep up with this “Let’em eat cake attitude,’ there won’t be enough lamp posts in America for the political necks on the line.
- unspun - Monday, Nov 7, 11 @ 10:32 am:
As for the workers compensation reforms, CAT was one of the biggest beneficiaries. As a self-insured company, the reduced fee schedule affects their bottom line directly (they don’t have to be concerned whether or not insurance costs go down). The medical portion of their claims paid got slashed 30%. And that’s just 1 of the many reforms that help CAT.
- LisleMike - Monday, Nov 7, 11 @ 10:57 am:
I am no fan of Duffy, but…2 bored; the reason
Chicago has the bandwidth is because of business and esp CME. Business will follow business. Do you really think the bandwidth providers won’t follow a big fish like CME wherever they go? @ Western Il: Gambling yourself aren’t you? easy to point finger at economy problems through CME “gambling” but what are you doing by daring them to leave? Best solution, do what is needed to keep them until another solution to replace them is available. Don’t cut off the nose to spite the face. Plan
- Wow - Monday, Nov 7, 11 @ 10:59 am:
Easy there Plutocrat03…steakhouses are an important part of Illinois’ economy…
Where else is Governor Thompson going to go to talk to others about the $100,000 duck decoy he bought last summer?
- downhereforyears - Monday, Nov 7, 11 @ 11:03 am:
CME should leave the state. This whole system is unfair to a business like theirs. Everyone cry and moan about how unfair they are being…..while the moving trucks jump on the Dan Ryan.
- wordslinger - Monday, Nov 7, 11 @ 11:10 am:
–“We said to Jerry, ‘Jerry, can we have part of the profits?’” Thompson told the Tribune’s Jared S. Hopkins. “And he said no. We said OK.”–
Given the bald payout to someone who didn’t need it, given the situation, given the players, given their history, that has to be a nominee for Incredible (in every sense of the word) Quote of the Year.
- truther - Monday, Nov 7, 11 @ 11:11 am:
Fact is, CAT had it’s most profitable quarter in history last month. Talk about corporate greed.
- Fed up - Monday, Nov 7, 11 @ 11:15 am:
Western Illinois
The mortgage mess that was created by well intended poorly thought out laws that forced banks to give mortgages to people who shouldn’t be getting them. The CME had nothing to do with that. But why let that get in the way of a good rant. Maybe we could start actually blaming the lawmakers who created this problem. You know madigan cullerton Emil jones Blago Quinn. Spending billions more than you have is criminal.
- picking winners - Monday, Nov 7, 11 @ 11:17 am:
Ah, so Downstate brings out the bogus Republicon “picking” argument.
OK, lets go with that in the current context. CME stock has declined over the past year, and at about $250/share now is way in the red after hitting oer $700/share at the top of the market in 2007. Now he wants a tax break-presumably to help his sorry stock price.
Of course, you don’t mention that…only something about waivers and Durbin.
Funny that its always Dems accused of “picking winners and losers” in the market - when its the big time free maketeers like Mr. Duffy that fix the system so they (the 1%) win and the rest of lose.
(P.S. I wonder if Duffy has loaded up on put options for his own stock if he doesn’t “win” this one! LOL)
- South Suburbs - Monday, Nov 7, 11 @ 11:21 am:
Sorry to be off topic, just got this in my inbox, thought it was interesting.
Monday, November 7, 2011
Please meet Ann Romney
6 pm at Speaker Hassert’s Home
1090 Creek Road, Plano, IL
$250 Donation OR $100 Committeemen Price
Phone 630.752.9661 for information
Please click on attached link for copy of
original invite: http://gallery.mailchimp.com/a2055b34013e2845107bfa348/files/11_7_Ann_Romney_Event_Chaired_by_Con_Biggert_and_Speaker_Hastert.pdf
You are receiving this email because you signed up at our monthly meeting (by postcard) or at www.willcountyrepublicans.com. Thank you. You may unsubscribe by emailing Terri@ptwintermute.com. THANK YOU.
Unsubscribe andrew.robinson@obamaalumni.com from this list.
Our mailing address is:
Will County Republican Central Committee
3 Player Court
Bolingbrook, IL 60490
Add us to your address book
Copyright (C) 2011 Will County Republican Central Committee All rights reserved.
- VanillaMan - Monday, Nov 7, 11 @ 11:25 am:
Illinois is like a 60 year old prom queen who discovered that her husband has a roving eye. Complain all you want and justify why you do not think businesses need to be accommodated but just be prepared when they take an interest in the others.
Illinois has gotten fat sloppy and comfortable. And quite unattractive.
I bet this old prom queen had forgotten where the gym even is.
- Robo - Monday, Nov 7, 11 @ 11:27 am:
I want 99%. Is that obscene?
- Carl Nyberg - Monday, Nov 7, 11 @ 11:33 am:
If the CME leaves Chicago over millions of dollars, my guess is that the Illinois delegation gets a whole bunch more enthusiastic about a transaction tax quickly.
The CME goes to a Republican state? The ultra-rich already have the Republican votes to opposes a transaction tax.
What’s keeping the transaction tax off the table is the ultra-rich have the support of the Democrats who represent Illinois, New York, Connecticut and New Jersey.
If the CME moves (something I’m exceedingly skeptical rich people on the North Shore and west burbs are going to support), there will be far more taxes levied than this squabble is about.
- wordslinger - Monday, Nov 7, 11 @ 11:35 am:
–I bet this old prom queen had forgotten where the gym even is.–
Are you referring to yourself? It can be read that way.
- Old and Cranky - Monday, Nov 7, 11 @ 11:35 am:
I got your mic check right here, you scruffy hippies!
- OneMan - Monday, Nov 7, 11 @ 11:35 am:
South Suburbs –
You found it interesting to try to get a free ad on CapitolFax?
You found it interesting you got a fundraiser e-mail, just put your e-mail up here and there are several folks here who deal with candidates who will be more than happy to see you get more interesting e-mail.
The e-mail does have a copyright notice (you included it) since you are not reporting news per se IMHO nor are you making saterical or critical comment it seems to me you are breaking the Will County Central Committee’s copyright.
- western illinois - Monday, Nov 7, 11 @ 11:37 am:
The mortages being created were for bond packages that Wall Street firms sold as gold and then betted against. True CME doe not sell CDSs but they sell other junk we would be better off without .
I have suggested a “financial” “products” Tranaction tax on Illinois residents . That money can be used for education,incentives for manufacturing…including CAT and others,education,infrastructure,the pensions and so on and if like cigarettes we gamble less so be it. The CME leaves good riddance
- Plutocrat03 - Monday, Nov 7, 11 @ 11:42 am:
I’m still annoyed that Big Jim stopped the clock during the stadium session to get the Sports Authority.
Jim and Jerry have been joined at the hip to the disadvantage of the taxpayers for decades.
- Grandson of Man - Monday, Nov 7, 11 @ 11:56 am:
This is an aside, but I just heard that AFSCME lost in court this morning when it tried to get an injunction against layoffs. The layoffs I think have something to do with the possible closure of Tinley Park mental health center and employees bumping others in the layoff process. Four people in my office got layoff notices last week.
- Boondocks - Monday, Nov 7, 11 @ 11:58 am:
“Downstate” has it right. Special interest tax breaks for big corporations that can lobby and spread around millions in campaign cash create an environment of corruption and crony capitalism! The government ends up picking the “winners” via tax incentives, and creates “losers” who must pick up the tax revenue slack by paying ever higher taxes. Why is it so difficult to process the economic reality of a lower tax rate equally applied to all would produce greater revenues for the state coffers? I don’t blame the big boys for trying to get lower tax rates, I just think they should be applied to ALL BUSINESSES regardless of size through tax reform.
- wordslinger - Monday, Nov 7, 11 @ 12:01 pm:
VMan, I’m sure you enjoy whiling your days away dreaming of old prom queens and such, but those of us in business consider cold facts.
CME, from a business standpoint, has no leverage for this break.
In it’s own words, has grown here by annualized rate of 19% a year for thiry years. It has grown into the largest derivative market in the world, with excellent profits that dwarf any increase in state income tax.
If you’d their own published material, you’d see projections of record profits for far as the eye can see and no mention of moving anywhere.
They have a huge human and capital investment here, that they just upped considerably by spending years and millions building a 428,000 square-foot co-location in Aurora that’s wired to the hilt.
The only other exchanges closely resembling their business model are located in the some of largest and highest-cost-of-living cities in the world.
So CME doesn’t have any leverage from a business standpoint for this holdup. Their leverage is in the form of friendly, powerful politicians who will ram this chump-change break down the rest of our throats while others wax ridiculous on prom queens.
- Michelle Flaherty - Monday, Nov 7, 11 @ 12:09 pm:
Regarding a few posts above …
Big Jim didn’t stop the clock. Powerful as he may have been, he NEVER controlled the House and his attempt to take over the Senate was stopped in court.
Regarding the “junk” CME sells that we’d be better off without. You mean like corn and soybeans? CME is influential in setting the price that the rest of this agricultural state bases its livelihood on. The Trib keeps telling me farmers are making out like bandits these days. I’m not so convinced, but surely they wouldn’t steer me wrong on economics.
- Lakeview - Monday, Nov 7, 11 @ 12:20 pm:
One other comment on CME and the communications infrastructure: sure, when they move to Indianapolis, someone will come in to expand the telecom system there to accommodate them. But if they have any downtime whatsoever in the switchover, they have just handed their keys over to the Frankfurt Exchange.
Good luck getting your Colts PSLs!
- Cook County Commoner - Monday, Nov 7, 11 @ 12:49 pm:
There are only two ways to deal with Illinois politicians: with threats or with cash. Government employee unions get what they want by giving cash, requiring members to give cash and other campaign assistance and helping the chosen get investment seed money from pension funds. Big businesses get what they can by threats to move, which would leave politicians with egg on their face, angry unemployed voters and diminished re-election prospects. Others with less size and cash do what they can with the Springfield kleptocrats. The rest of us are just observers queued up to be served up at the Roadkill Cafe.
- 47th Ward - Monday, Nov 7, 11 @ 12:50 pm:
===her husband has a roving eye.===
Interesting analogy VMan. So it’s the “wife’s” fault that the “husband” has a roving eye and you’re saying this is analogous to it’s the State’s fault that CME wants to leave. “Going to the gym” I suppose is analogous to improving the state’s financial picture then.
In other words, men who break their vows and cheat on their spouses should be absolved because their prom queen wives have gotten older and their looks have faded. Nice sentiment from a traditionalist. Sort of like Pat Robertson saying it’s OK to divorce a spouse with Alzheimers. What’s wrong with you VMan?
It seems to me a tradtionalist would find the thought that CME wants to break its vows rather contemptible. Instead, VanillaMan thinks it’s perfectly OK, even expected, for husbands to dump older wives for younger, prettier women. And we wonder why the institution of marriage is threatened, just like we wonder why America isn’t the pinnacle of the civilized world anymore.
We used to call men who dumped their wives Cads. What do we call companies who feel no obligation to the states that have stood by them for decades? Isn’t violating a social contract the same thing as violating a marriage vow?
I think you need a better analogy VMAn.
- soccermom - Monday, Nov 7, 11 @ 1:04 pm:
Nice, 47th.
- CircularFiringSquad - Monday, Nov 7, 11 @ 1:35 pm:
NO ONE fprced the banks to do no doc loans to the unqualified, send the hustlers, brokers and appraisers out every year to do bigger loans and bigger HELOC. CME and its friends are all around leveraged debt instruments that helped create what the WSJ called the credit crunch now has the world economy teetering on a smaller amount of Greek debt than the US govt gave to AIG.
It would be nice of commenters drop the Rush/Beck rant points they have been off the mark for several years now
- Quinn T. Sential - Monday, Nov 7, 11 @ 1:39 pm:
I just ran into the premiere Rich Miller look alike at Clark & Jackson headed south towards Van Buren. I was afraid at first that it was you and you would get there right at the same time that they were starting to lock people up.
- Judgment Day - Monday, Nov 7, 11 @ 2:01 pm:
Duffy is having to deal with shareholders, and they are asking “Why” (among other things). You can say they are being greedy (probably are, IMO), but that’s an opportunity for other states. And they are going to go full force to land an operation like CME.
You can pretty much tell that Duffy doesn’t want to leave. Maybe, just maybe that’s the reason for some of his comments. But the decision is not his alone - he has constituencies he also has to answer to. Did anybody ever think about how much dollars and influence the different CME players provide to our varied cultural and sporting venues here in Chicago?
If the CME decides to go elsewhere, a portion of the tech infrastructure will follow - quickly. The CME is a player - and people will relocate for that level of business. Happens all the time.
I always remember back in the 1980’s when CAT built TWO of the most modern, automated foundries in the world (Mapleton, IL) -and- at almost the same time, a vast expansion of the nationwide parts center at Morton, IL (literally built a multi-lane tunnel under I-74 for automated parts retrieval) and completely built the building structure North of the Interstate.
Fast forward to today: Mapleton II basically has weeds growing in the parking lot (all ready to go; never opened) and Morton Parts North is just a memory - all gone. Big, big money. Btw, CAT in the last 2 years just opened a couple of large new parts centers outside of IL.
So, it can and does happen. Just because CME has made the investment in Aurora doesn’t mean that they are stuck here.
- bored now - Monday, Nov 7, 11 @ 2:06 pm:
LisleMike: you’d have a valid point IF that backbone bandwidth didn’t exist before CME even considered going digital. the backbone wasn’t built for CME and it won’t be expanded in Indianapolis unless CME pays for it. if it has the millions for that, then it really won’t mind paying its taxes…
- Anonymous - Monday, Nov 7, 11 @ 8:02 pm:
“VanillaMan thinks it’s perfectly OK, even expected, for husbands to dump older wives for younger, prettier women. And we wonder why the institution of marriage is threatened”
Since it’s wail on VanillaMan day and just in case he ever uses that analogy again, maybe we should also ask whether the institution of marriage is threatened when men dump their younger, prettier wives for old prom queens, too.
- VanillaMan - Monday, Nov 7, 11 @ 8:46 pm:
Note to self:
Drop any future prom queen references.
Offends old prom queens.
- wordslinger - Tuesday, Nov 8, 11 @ 8:03 am:
VMan, write yourself another note: Try bringing an informed opinion to the game sometime, rather than just using it as a forum for holier-than-thou rants.
- VanillaMan - Tuesday, Nov 8, 11 @ 10:10 am:
I enjoyed the come backs posted after my sloppy analogy!
Especially Wordy’s!
Remember, he always brings an informed opinion to every posting, even when he is completely wrong.
…and when he forgets to wipe or flush before pressing the “Say it!” button.