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Tipping their hand?

Tuesday, Nov 29, 2016

* One of the problems that many Democrats have with workers’ compensation reform is that it too often seems like a never-ending race to the bottom.

Yes, there’s no doubt that more reforms are needed here. But check out this quote from yesterday’s House hearing

Legislators overhauled workers compensation in 2011. Jay Shattuck with the Illinois Chamber of Commerce says that made a dent, but Illinois’ system is still too expensive.

“From the business community standpoint, 2011 was a good start. We have, um, had, some savings. Which we are glad to have,” Shattuck said. “But we’re not in a static environment. Other states have been aggressively looking at workers’ compensation reforms and have passed legislation and enacted laws that have helped their businesses in their communities also to have lower workers’ comp costs.”

So, apparently, as long as other states continue to “aggressively” cut workers’ compensation benefits, Illinois will have to go along.

* Related…

* Workers’ compensation for state, county and municipal workers costs Illinois taxpayers $400 million per year

- Posted by Rich Miller        

26 Comments
  1. - wordslinger - Tuesday, Nov 29, 16 @ 11:28 am:

    In another thread, an insurance flack said more insurance companies write policies here –332 — than in any other state.

    Stands to reason that the profit margins here for the insurance companies are pretty good.


  2. - Anon221 - Tuesday, Nov 29, 16 @ 11:34 am:

    Say we go on to the race to the bottom, and cut benefits to injured workers that have claims based on just causation. As the medical community testified yesterday, cutting benefits cuts into medical services, and can easily lead to more workers facing shorter working careers AND the possibility of permanent disability. The softball and fishing dog whistles need to stop. Take a good look at what could be lost if we “compete” with Indiana or any other state that values workers less. Do you want good, safe workplaces in Illinois provided by conscientious employers who understand that safe workplaces are part of a profitable business? Or, do you want employees to have to take what is offered, even if it’s not safe just so they have a job regardless of the risks? Causation is not only on the employee’s shoulders. Causation can be part and parcel of how a business is run and managed. Do we value Illinois workers, or simply put a price on them because they can be replaced.


  3. - Downstate - Tuesday, Nov 29, 16 @ 11:42 am:

    Why does Illinois offer tax incentives to lure companies to come to Illinois? Why do municipalities offer tax abatements to entice expansions? Because other communities are doing the same thing. And we have to compete.

    We can willfully disregard the unequal playing field that we’ve created for our state with our work comp policy. But we do so to our own economic detriment.


  4. - Illinois O'Malley - Tuesday, Nov 29, 16 @ 11:45 am:

    Dear D’s,
    Please offer a bill dissolving workers comp and throw it back in the state courts. Let’s see how fast businesses fight that one…


  5. - jade me not - Tuesday, Nov 29, 16 @ 11:59 am:

    In that same hearing, a GOP lawmaker advocated for more reform while referring to himself as a “small business owner with 550 employees”. Uh, what’s a LARGE business then?
    Shattuck’s comments affirm the goal of racing to the bottom, which is probably why the Chamber refused to support the bi-partisan bill that was passed in 2011. It’s never going to be enough.


  6. - Team Sleep - Tuesday, Nov 29, 16 @ 12:05 pm:

    IO - be careful with that. Madison and St. Clair County courts (and the circuits under which they fall) are not nearly as trial lawyer friendly as they used to be, and the 5th Appellate Court just flipped to a 4-3 GOP majority. 10-15-20 years ago I would say that your analysis is spot on. But now that major players like John Baricevic are gone the concept of a “rocket docket” for workers and their attorneys is not as feasible.


  7. - wordslinger - Tuesday, Nov 29, 16 @ 12:12 pm:

    –We can willfully disregard the unequal playing field that we’ve created for our state with our work comp policy. But we do so to our own economic detriment.–

    Talking point, talking point, harrumph, harrumph…

    Meanwhile, back on Planet Earth, Illinois was third in the nation last year in the number of new corporate sitings of $1 million or more that created at least 20 jobs: 413.

    The whiz kids in Indiana had 166. The Cheeseheads didn’t make the Top 10.

    Illinois also ranked third in new projects in 2014.

    Wouldn’t it be swell if the governor welcomed such news? But his agenda is political, not economic.

    2015 TOP STATES
    by Number of Projects
    2015
    Rank State 2015 2014

    1 Texas 702 1
    2 Ohio 517 2
    3 Illinois 413 3
    4 North Carolina 300 4
    5 Kentucky 285 6
    6 Michigan 217 7
    7 Georgia 211 5
    8 Pennsylvania 202 8
    9 Virginia 167 11
    10 Indiana 166 12
    Source: Conway Projects Database

    2015 TOP STATES
    by Projects Per Capita
    2015
    Rank State 2015
    Proj.
    Count 2014
    Rank
    1 Kentucky 285 1
    2 Nebraska 118 28
    3 Ohio 517 2
    4 Illinois 413 8
    5 Kansas 93 4
    6 Louisiana 148 3
    7 North Carolina 300 6
    8 Iowa 92 10
    9 South Dakota 24 5
    10 Alabama 127 16
    Source: Conway Projects Database

    http://siteselection.com/issues/2016/mar/cover.cfm


  8. - Chicago 20 - Tuesday, Nov 29, 16 @ 12:21 pm:

    North Dakota has the lowest workers comp rates, restricted benefits, and caps on just about everything.

    North Dakota also has the highest worker death rate.

    http://www.inforum.com/content/lawyer-accuses-nd-wsi-failing-injured-workers

    “North Dakota consistently has the lowest workers’ compensation rates in the country, Haas wrote, and has returned premium dividends to employers totaling $774 million from 2005 through last year, making the effective premium rate for many employers lower.

    Those lowest-in-the nation premiums contribute to a lax workplace safety environment resulting in North Dakota’s highest-in-the-nation occupational death rate, Haas argues”.


  9. - Illinois O'Malley - Tuesday, Nov 29, 16 @ 12:44 pm:

    @Team Sleep, good point. It would come down to accident/owner location’s court make-up


  10. - Bubbles - Tuesday, Nov 29, 16 @ 12:51 pm:

    Wordslinger,

    Since when does more competition (332 insurers in Illinois) translate into higher profit margins for all competitors involved?

    Is your bubble a special bubble where there ain’t no such thing as economics?


  11. - Downstate - Tuesday, Nov 29, 16 @ 1:10 pm:

    Word,
    Then I guess everything is just peachy in Illinois! Let’s hang our hat on that statistic and call it a day.
    Illinois unemployment rate is currently 5.6%. At one time, that number was considered nearly full employment.

    In fact, it’s very tough for most working people. Many firms haven’t offered pay raises in two years. Insurance premiums have put people even further behind.

    My friends in both the development and construction industry will tell you that marketing Illinois is very very tough. And they will tell you that one of the top three reasons is Illinois work comp. rules.


  12. - Demoralized - Tuesday, Nov 29, 16 @ 1:24 pm:

    My issue is the incessant comparisons to what other states are doing. Fine. Look at other states. But just because Indiana jumped off a bridge doesn’t mean we have to. I get tired of the constant drumbeat of trying to benchmark everything to other states. Reform workers comp? Sure. There are things that can be done. But don’t tell me we need to be exactly like Indiana or any other state. It’s ok that an arm is worth more in Illinois.


  13. - Rich Miller - Tuesday, Nov 29, 16 @ 1:25 pm:

    ===But don’t tell me we need to be exactly like Indiana===

    Who told you that?


  14. - Demoralized - Tuesday, Nov 29, 16 @ 1:28 pm:

    Nobody. I was making a point. I picked a state that we seem to be obsessed with in Illinois.

    Don’t tell me we need to be like “X” state? Better? Sheesh.


  15. - Rich Miller - Tuesday, Nov 29, 16 @ 1:32 pm:

    ===I was making a point===

    And you didn’t do it very well. Don’t argue like a child, please.


  16. - Demoralized - Tuesday, Nov 29, 16 @ 1:37 pm:

    My point?

    ==It’s ok that an arm is worth more in Illinois.==

    I didn’t think that was a difficult concept to understand.


  17. - Grandson of Man - Tuesday, Nov 29, 16 @ 1:37 pm:

    We are in a harsh race to the bottom now in this country, with voters and politicians enabling it. States are competing to lower wages, benefits, job protections and workers’ rights. Corporate earnings were or are at record highs. Wages have been struggling. Union membership is the lowest it’s been for many decades. Retirement insecurity is looming and here already, as many workers don’t earn enough to save, some corporations don’t even contribute to retirement funds and there are fewer defined pensions.

    We are also facing possible or likely cuts to Medicare and Social Security.

    This is where Democratic messaging is lacking in this state and elsewhere. There are low hanging fruit here in Illinois. We have a few super-rich buying a political party and sacrificing the poorest, sickest and most vulnerable to attack many thousands of middle class workers.


  18. - Bubbles - Tuesday, Nov 29, 16 @ 1:53 pm:

    GoM:

    It’s not Democratic messaging that is lacking. It is results in terms of actual job creation and opportunities to rise. That problem is as real in Illinois as anywhere.

    It wasn’t Democrats who went in and reformed IN, WI and MI to lower taxes and allow for job creation. It shouldn’t be a surprise that blue collar workers those states, after seeing proof of concept and being stoked by a candidate who speaks their language, flipped red.

    The race to the bottom has been won by states like Illinois who have completely left their working class behind in favor of a city-based progressive agenda that does not allow blue collar industries to thrive. When your people are fleeing your state, you’re about to get the gold medal for winning the race to the bottom.


  19. - Lucky Pierre - Tuesday, Nov 29, 16 @ 1:54 pm:

    Can someone tell Lou Lang that the cost for Illinois state and municipal employees workers comp insurance costs 400 million dollars a year? He has said none of the proposed Turnaround Agenda items have anything to do with the budget.

    Any savings on workers comp would be directly related to the budget and could be used to offset higher pension and employee health care costs or salary increases.


  20. - Grandson of Man - Tuesday, Nov 29, 16 @ 2:44 pm:

    “It wasn’t Democrats who went in and reformed IN, WI and MI to lower taxes”

    It was Democrats who raised taxes in Minnesota and California, two states that are doing as good or better than Wisconsin, Indiana and Michigan. They didn’t resort to pushing down job protections and union rights. You seem to imply that lowering features that make a stronger middle class brings middle class prosperity.

    We passed workers comp reform already. Madigan is willing to pass more but will not give in to Rauner’s agenda that would go a long way toward weakening the power of middle class workers. I probably would support my elected officials passing more reform to help businesses, if it doesn’t go too far. Remember, if Rauner had his way, Illinois would be a RTW state with repeal of the prevailing wage and significant/substantial decrease in compensation for injured workers.

    To those who are sick that Illinois doesn’t follow the red state models that have been sweeping the Midwest, you can leave. Seriously. You have plenty of red states all over America.


  21. - CrazyHorse - Tuesday, Nov 29, 16 @ 3:30 pm:

    ==Can someone tell Lou Lang that the cost for Illinois state and municipal employees workers comp insurance costs 400 million dollars a year? He has said none of the proposed Turnaround Agenda items have anything to do with the budget.==

    That’s not exactly accurate. I’m pretty sure even Lou Lang knows that if the State could reduce its WC costs, there would be a savings to taxpayers. The issue with the TA is that there has never been any concrete evidence from Rauner showing that by cutting X the state would save Y. Rauner on the TA essentially sounds like Kevin Costner in Field of Dreams saying “Build it and they will come.”


  22. - Bubbles - Tuesday, Nov 29, 16 @ 3:34 pm:

    California and Minnesota are doing as good or better for precisely whom: production workers or service sector and tech workers? Do you really think the blue-collar production worker is thriving in the SF bay area? LA? San Diego?

    If you are worried about the collapse of unions it would be worth recognizing that unions are on average growing in RTW states and shrinking in forced-union states. Why might that be?

    Illinois’ workers’ comp law does about nada for middle class prosperity. It drives their jobs outta state. But it does a whole lot for doctor and trial lawyer prosperity. Is that your middle class?

    I think there are a lot of assumptions built into your arguments that simply are not true. As for telling all the reds to get out of Illinois — are you volunteering to cover the leftover tax bill? How has that strategy been working out for the good ole Land of Lincoln?


  23. - wordslinger - Tuesday, Nov 29, 16 @ 3:52 pm:

    –Then I guess everything is just peachy in Illinois! Let’s hang our hat on that statistic and call it a day.–

    Did you miss your nap after story time or something?

    I posted a fact: Illinois was third in the nation last year with 413 corporate sitings of $1 million or more that created at least 20 jobs. The state was third in 2014 as well.

    I don’t know why that upsets you. I doubt that facts influence your views one way or the other.

    –My friends in both the development and construction industry will tell you that marketing Illinois is very very tough. And they will tell you that one of the top three reasons is Illinois work comp. rules.–

    Your “friends in both the development and construction industry” are in the business of “marketing Illinois?” How does that work?

    Strangely, workers comp hasn’t stopped the ongoing Chicago commercial real estate boom, largely driven by foreign investment. Count the cranes. Those are facts, too. I’m sure they will really upset you.

    https://www.mbfinancial.com/insights/grow/articles/2016/20160212-chicago-real-estate/index.aspx


  24. - Truthteller - Tuesday, Nov 29, 16 @ 4:00 pm:

    Both the Cubs and the Blackhawks have demonstrated that good management can produce a successful business. All these whiners who want to blame someone else for their inability to run a successful business ought to spend more time tending to business and less time complaining


  25. - Bubbles - Tuesday, Nov 29, 16 @ 4:30 pm:

    Wordslinger:

    In what world would workers’ comp costs negatively or positively affect investment in the the commercial real estate boom in Chicago?

    How would commercial investment for service-sector employment in the Loop, which is not affected by workers’ comp costs, be evidence of anything other than the fact that Illinois can be an attractive place to invest so long as you’re in an industry not being hammered by taxes and regs?

    Manufacturing has disproportionate use of property (prop taxes) and risk-intense labor (workers’ comp) relative to its revenues. Tech and service sector have substantially higher revenues relative to their use of property and risk-intense labor. They probably don’t care about workers’ comp one way or another and their property taxes are very survivable.

    So far you’ve presented evidence of nothing that supports any claim either way. If you’re pointing to lots of corporate investment last year, show where that corporate investment is leading to job creation in the sectors affected by the relative regulatory items. Illinois is -6,000 on manufacturing jobs last year and -8,000 this year.


  26. - wordslinger - Tuesday, Nov 29, 16 @ 4:44 pm:

    –In what world would workers’ comp costs negatively or positively affect investment in the the commercial real estate boom in Chicago?–

    In the real world where heavy equipment, cranes, steel, concrete and glass are marshaled and assembled by workers, floor-by-floor, 70 stories into the sky?

    Seems to me there might be a wee bit of risk of injury in that sort of endeavor.

    Was that supposed to be a brain teaser?


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