* Treasurer Dan Rutherford threatened yesterday to tell the New York bond houses that he’s opposed to more long-term borrowing…

State Treasurer Dan Rutherford threatened Monday to short circuit attempts by Illinois lawmakers to borrow money to pay down a massive backlog of bills.

Rutherford, a Republican in his first term, said he doesn’t have the constitutional power to stop a long-term borrowing plan favored by Gov. Pat Quinn and some Democrats in the House and Senate, but he said he’d call bond houses and financial rating firms to outline how deep the state is in debt in an attempt to derail them from lending the state money.

“If I need to send letters to the rating companies to tell them the treasurer of Illinois is opposed to more borrowing, I’m going to do that,” Rutherford said. “We need to cut our spending and break our unsustainable borrowing cycle before we realize a further financial disaster.”

* His statements were actually even harsher than that. Watch the video…

* Quotes…

“My position is you can’t borrow any more money… And if it means I have to get ahold of the bond houses and let them know that I agree with you, that we are a major risk, and I’m the finance officer of this state, I intend to do those kind things if that’s what it’s going to take to keep Illinois from going into further debt.”

* Rutherford’s press conference came after I told subscribers yesterday that the Senate was preparing to vote on four different bills to borrow more than $6 billion over seven years. Democratic Sen. John Sullivan is the sponsor of those bills…

(L)awmakers are maneuvering to pass a measure through the General Assembly that would bypass any authority Rutherford has.

“I don’t have a vote on (the Senate plan),” said Rutherford. “If it’s long term, I can’t stop it.”

State Sen. John Sullivan, D-Rushville, said Republican and Democratic lawmakers must approve any borrowing, and Rutherford’s approach to handling Illinois’ massive pile of unpaid bills bothers him.

“Right now we’re using school districts, universities, private companies and health-care providers — we’re using them as our credit card,” said Sullivan. “They’re carrying that debt for us.”

Sullivan said he agrees with the treasurer that Illinois does not need to take on any new debt, but paying off old bills is taking care of old debt.

* Again, Sullivan’s comments were harsher than reported…

Quotes…

“To say that this backlog of these unpaid bills the state has should not be included in [Rutherford’s] statement, that seems to not make any sense whatsover… To make the statement that he is going to call the bonding companies and discourage them from doing business with the state of Illinois to drive up the cost of borrowing just seems very counterproductive… He’s making the point that it costs more to [borrow] and on the same hand he’s taking steps… he’s going to drive up that interest cost even more. Instead of working with us, it’s like he’s working against us.”

Thoughts?