* Greg Hinz…
Rauner’s right that the state’s economy has lagged, and has done so for a long time. But will his solution work?
Fortunately, we don’t have to go very far to find a real-world point of comparison. That’s in neighboring Wisconsin, another Rust Belt state that has lagged the nation’s growth for decades, but which, in January 2011, got a new governor much in the mold of Rauner in Scott Walker. And unlike Rauner, Walker had a GOP-majority legislature to work with, so he was able to actually get through the sorts of union-weakening measures that Rauner so far can only dream of.
Did it work? According to research forwarded to me a few months back by the Rauner-friendly Illinois Policy Institute, between January 2010 and January 2016, total private-sector job growth in Illinois and Wisconsin was almost identical: 7 percent here versus 7.1 percent there.
Using a slightly different time period shows a slightly different result.
According to federal Bureau of Labor Statistics data crunched for me by my colleague John Pletz, comparing December 2010 (the month Walker took over) to December 2015 shows a 5 percent employment gain for Wisconsin to 3.3 percent for Illinois. But Illinois entered the great recession a little later than Wisconsin and came out of it a little later. So if you compare December 2008 to December 2015, the difference is just 1.2 percent, with Wisconsin up 2.4 percent and Illinois half that.
When I asked Rauner about that when he appeared before Crain’s editorial board last week—click on the video and go to around minute 53 — he said it “takes time” for changes to kick in.
Fair enough, but if you look just at the last two years, December 2013 to December 2015, the job growth figures again are almost dead even: 2 percent here versus 2.4 percent there
* Greg asked Rauner if that data suggests “the reforms you want aren’t the great panacea?” His reply…
“No, not at all. The comparables are not necessarily just Wisconsin, or Michigan or Indiana. But the comparables are Tennessee, Texas, South Carolina, Georgia where there’s a lot more rapid growth. You’ll see in the long-term, Wisconsin and Michigan start to fix their problems, and you can certainly see it in Indiana. Indiana started fixing their problems earlier than Wisconsin and Michigan, that’s why they’re taking so many more of our jobs and their financial health is so much better.
“Wisconsin’s financial health isn’t all that good. See, Wisconsin and Michigan, but especially Wisconsin, they were a collectivist state, even before Illinois. And they were more extreme than Illinois in the collectivism. And they’ve already got a high graduated income tax and they’ve already got embedded the problems that we haven’t gone to yet. I’m trying to prevent us from going there, because once you get there, coming back from that is all the harder.”
There’s that word again.