*** UPDATED x1 *** Fun with numbers
Thursday, Sep 15, 2011 - Posted by Rich Miller
* Apparently, they have no fact-checking requirements at the New York Times…
Facing a budget deficit exceeding $11 billion, the State of Illinois in recent weeks has begun challenging the property tax exemptions of some of its best-known hospitals, saying they should pay more because they are not providing enough charity care.
Wow. So many problems in just one lede.
I asked the reporter how he came up with the $11 billion number and the reply came back: “the state.” Well, whichever person at “the state” said this was completely wrong. Because of the income tax hike, the structural deficit is down to about a billion or so, although the state is struggling to pay off something like half that $11 billion amount in overdue bills.
Also, even if the $11 billion figure was correct, and it’s not, what the heck do property taxes have to do with the state budget? There are no state-levied property taxes. Those are local taxes. There is no push to strip income or sales tax exemptions. It’s all about local taxation.
The rationale given for this push is also incorrect because the state actually started ramping up its property tax exemption challenges after it won a big court case last year.
The rest of the NYT story is pretty good, but that lede is just bizarrely off kilter.
* Meanwhile, this amount of money to pay for the China trade mission doesn’t bother me all that much…
The Democratic governor and his fellow travelers will pay their own way to China, but the trip is expected to run taxpayers about $133,000 for associated costs such as meeting space.
The cost comes at a time when Quinn has proposed mass layoffs and state facility closures due to a lack of money.
Expand economy = more money from taxes = less need for state layoffs and closed facilities. And considering that this trip will likely increase exports, that $100K is money well spent…
Besides Navteq Corp. President and CEO Lawrence Kaplan, the group includes mid-level executives from three large Illinois companies—Archer Daniels Midland Co., United Continental Holdings Inc. and Navistar International Corp.—plus five execs from smaller, privately held firms. Others on the mission include elected officials such as Rockford’s mayor, Lawrence J. Morrissey.
Mr. Quinn expects to preside over the signing of agricultural and telecommunications contracts worth “hundreds of millions of dollars” for Illinois exporters, according to a statement released by his office on Thursday. He also plans to sign agreements for future business exchanges in biotechnology, clean energy and education. […]
While Indiana’s governor or lieutenant governor has visited China or Japan nearly every year for the past decade, this is the first China trade mission by an Illinois governor since former Gov. Jim Edgar went in 1996, when Illinois exports to China were about a sixth of what they are now.
“It’s a very good, positive thing that Gov. Quinn is going to China,” Mr. Ingraham said. “Having the governor go is a real door opener for your state. The Japanese and Chinese really appreciate your top person going.”
More…
China is the third largest export destination for Illinois products, totaling $3.4 billion in sales last year. Products exported include machinery, electronics and agricultural goods.
*** UPDATE *** Big doings on this trip…
Archer Daniels Midland Co. is poised to sign an agreement to sell 180,000 metric tons of soybeans to a Chinese food and supplement manufacturer.
The Decatur-based company announced the pending deal Thursday on the eve of the start of an eight day trade mission to China headed by Illinois Gov. Pat Quinn.
ADM said the agreement with Jiusan Oils and Grains Industries Group Co. Ltd. is part of an effort to boost the company’s ability to serve growing Chinese demand for crops. China is the world’s No. 1 importer of soybeans.
[ *** End Of Update *** ]
* And Mike Riopell at the Daily Herald took a look today at the latest gaming revenues analysis from the Commission on Government Forecasting and Accountability and highlighted this analysis of why casino gaming receipts are down…
These factors include the struggling economy, increased competition from other states, and the effects of the graduated tax structure.
However, the numbers continue to suggest that the biggest contributor to the drop in Illinois casino revenues is the indoor smoking ban. Since the indoor smoking ban began in January 2008, adjusted gross receipts for Illinois riverboats have fallen a combined 30.7% from pre-smoking ban levels.
Yikes.
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Loaded and flawed rhetoric
Thursday, Sep 15, 2011 - Posted by Rich Miller
* From WLS AM…
A lot of reaction Wednesday morning to Congresswoman Jan Schakowsky’s interview with Don Wade and Roma.
Schakowsky said that Americans don’t deserve to keep all of their money because we need taxes to support our society.
The WLS headline is: “Schakowsky: Americans don’t deserve to keep all of their money.”
* You have to, uh, wade through a whole lot of DC talking point goofiness from both sides, but this exchange occurred near the end of the interview…
Don Wade: Out of every dollar that I earn, how much do you think that I deserve to keep?
Jan Schakowsky: What is really your question here? Do you think you should not contribute to firefighters…
DW: No. It’s a very simple question. Out of every dollar that I earn, how much do you think that I deserve to keep?
JS: No, it is not a simple question. I think…
DW: Very simple.
JS: I’ll put it this way. You don’t deserve to keep all of it. And it’s not a question of deserving. Because what government is, is those things that we decide to do together. And there are many things that we decide to do together like have our national security, like have police and fire.
DW: OK, national security, police, fire, got it…
JS: What about the people that work at the National Institute of Health who are looking for a cure for cancer? Do you think we ought to do that together? Those are real jobs and those are things that you help pay for and I think that’s a good thing.
DW: OK, so let me ask again. Out of every dollar I earn, how much do you think that I deserve to keep?
JS: I’m not going to give you a percentage, I don’t know what your income is.
DW: Well, what does my income got to do, I’m just asking you how much…
JS: I think you need to pay your fair share, in order to do the things that we’ve decided are national priorities.
DW: So, wait, hold on, who’s deciding what my fair share is?
And that’s when I had to stop listening.
Don Wade is apparently too dense to understand that tossing around a fun little talking point over and over again doesn’t actually mean anything. and also cannot fathom that tax rates are set by duly elected officials. And Schakowsky apparently lacks the self awareness to realize that appearing on that show means she’ll get punked and made to look stupid because she doesn’t have what it takes to defend her ideals in a coherent manner on morning radio (I deleted all her “ums” because otherwise this post would’ve been as unreadable as her radio appearance was unlistenable).
Question: Out of every dollar I earn, how much do you think that I deserve to keep?
Answer: Absolutely every penny that you’re entitled to keep as a law-abiding citizen of a republican democracy. And if you think you deserve to keep more, then by all means you should vigorously participate in the governance of your country. That’s what America is really all about.
Jan Schakowsky believes some people and some corporations should get to keep less. There’s no shame in saying that, and she should’ve just come right out and said it, for crying out loud. But if the above conversation is how the Democrats intend to compete next year, they’re in a huge world of hurt.
* Speaking of rhetoric, RedState’s Stephen DeMaura, completely demolishes Amazon’s anti-tax argument from the right…
Amazon.com, the biggest dog in the online retailer market, has created confusion by co-opting conservative language to position itself as a victim of allegedly greedy politicians who just want to raise taxes on good American businesses to pay for bigger government. Rather the opposite is true. The true victims are the local businesses who do not have the favorable tax status that Amazon has long enjoyed. Take, for example, Amazon’s response to a recent California law demanding it collect sales taxes at the point of purchase, just like thousands of Main Street retailers are required to do. It immediately challenged the state legislature and the governor by threatening to spend tens of millions of dollars on a ballot referendum to avoid collecting hundreds of millions in sales taxes.
The result? Amazon sees record revenues with its preferred tax status while small and community-oriented Main Street retailers foot their bill and struggle to stay alive.
But the story Amazon has been telling is fictitious. And its use of conservative nomenclature to do it has been cynical. The fact that Amazon relented and has agreed to begin collecting sales taxes in California beginning next year proves it.
California legislators threatened Amazon by pushing the same legislation that Illinois passed. The company fought back hard, but in the end agreed to a compromise and the company will begin collecting California sales taxes next year. Illinois should revisit this issue. We’ve lost at least two companies that are Amazon affiliates because Amazon refused to do business with affiliates based here after Illinois passed similar legislation. California became the tipping point. Perhaps a compromise can now be reached in Illinois.
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Question of the day
Thursday, Sep 15, 2011 - Posted by Rich Miller
* After waiting months to pay off his own bet to Wisconsin’s governor, Gov. Pat Quinn now wants a former governor to pay off his bet…
Illinois governor Pat Quinn is still waiting on the former governor of Pennsylvania, Ed Rendell, to fulfill a bet the two placed on the Stanley Cup finals between the Chicago Blackhawks and Philadelphia Flyers in 2010.
The loser of the bet was to travel to the other’s state, wear a jersey of the winning team and work at a local food bank. The Hawks beat the Flyers in six games in June 2010 to snap a 49-year Stanley Cup drought.
“I had to do a similar thing in Wisconsin when the Bears lost to the Green Bay Packers in the playoffs last season,” Quinn quipped on Wednesday morning at the opening of ESPNChicago’s new street-level studios. “I went up there and wore a Packers jersey, though I had (a) Gayle Sayers jersey on underneath. I think Governor Rendell needs to do the same here.”
Rendell left office last year and contends it’s Quinn’s fault the bet was never paid off.
“There were two dates set and Governor Quinn canceled both of them for business reasons,” Rendell responded Wednesday afternoon. “However, if the governor is obsessed with me coming in, I will do so even though I am no longer governor and we are no longer Stanley Cup rivals.”
I know he was just joking, but Quinn canceled on Rendell twice and he still expects him to pay up? By the way, in case you’ve forgotten, the Blackhawks won the Stanley Cup about 15 months ago.
* The Question: Should Rendell keep his commitment? Why or why not?
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Madigan warns of political doom
Thursday, Sep 15, 2011 - Posted by Rich Miller
* I linked to this story before, but let’s flesh it out today. House Speaker Michael Madigan spoke to a DNC executive committee meeting in Chicago over the weekend…
…Madigan told the nation’s top Democratic leaders that the president’s proposed job-creation plan was important for the incumbent and the party heading into the 2012 elections.
“What’s important is that all of us, however possible in a public way, demonstrate our firm support for the president’s policy,” Madigan said. “It’s important for the nation. It’s important for the American people. It’s critical for the Democratic Party in the general election in 2012,” he said.
“Let’s think in terms of going to the polls today. We’d be in trouble. We’d be in serious trouble. So we have a window of opportunity between now and November 2012 to right the ship.”
The basic message here is that if Democrats don’t hang together then they will surely hang separately.
Heck, even if they do hang together there could still be big trouble if this economy doesn’t turn around soon.
* Whatever happens, Madigan was absolutely right about the peril of the moment. A few days after he spoke, the Democrats lost a New York special election in what had been a solidly Democratic congressional district. Nate Silver has some grim analysis for the party in a new post called “For Democrats, It’s 2010 All Over Again.” After admitting that this was just one election (along with three other specials since May) and pointing out several aggravating circumstances, Silver wrote…
Republicans have overperformed the [Partisan Voting Index] baseline by an average of 7 percentage points across the four races. That squares with what we saw in 2010, when Republicans won the popular vote for the House by an aggregate of 7 percentage points.
In other words, the four special elections, taken as a whole, suggest that Democrats may still be locked in a 2010-type political environment. Democrats might not lose many more seats in the House if that were the case, since most of their vulnerable targets have already been picked off, but it would limit their potential for any gains. And it could produce dire results for the Democrats in the U.S. Senate, where they have twice as many seats up for re-election.
It’s certainly possible to read too much into special elections to the House. Over the long run, they have had a statistically significant correlation to the outcome of the next general election. But the relationship is weak and frequently runs in the wrong direction, as it did in 2010.
* President Obama won’t do nearly as badly in Illinois as he will in other states. But he won a whole lot of areas last time that are now completely unobtainable. He and state Sen. Matt Murphy (R-Palatine) pulled about the same percentage of votes in Murphy’s Northwest suburban district. No way does that happen again. Also, Obama can forget about southern Illinois.
If things don’t radically change soon, Obama’s county map will look a lot more like Quinn 2010 than Obama 2008. And that means even with this new and much more partisan district map, legislative and congressional Democrats could still be in very big trouble here.
* Related…
* Press Release: Pollak lauds 2010 9th CD race as blazing trail for 2011 New York win
* Chuck Sweeny: George Gaulrapp plans heavy use of social media
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Still playing the victim
Thursday, Sep 15, 2011 - Posted by Rich Miller
* Congressman Joe Walsh’s new attorney is as adept at playing the victim card as her client. She released this press release about the Sun-Times story on yesterday’s child support court hearing…
Contrary to the erroneous Sun Times story, there was no order entered requiring Representative Walsh to appear on the next court date.
The next court date is a status proceeding not a hearing which was also erroneously reported by the Sun-Times.
The Court simply requested that both attorneys provide him with copies of their respective pleadings on the November 8th date after I asked for the ability to file new pleadings which I expect will fully set forth Rep. Walsh’s responses to the allegations of his former wife.
Pursuant to Illinois statutes the burden of proof now shifts to Rep Walsh upon the Rule issuing.
Mr. Walsh is very satisfied with the judge’s orders of today, as it will finally afford him the opportunity to present his case to the court.
Let’s take these point by point, shall we?
1) The Sun-Times never claimed that Walsh was ordered to appear at the next court date. In fact, just the opposite was reported…
But after Laura Walsh’s attorney said he didn’t think the congressman needed to appear at the next hearing, [Cook County Circuit Judge Raul Vega ] ultimately did not issue an order requiring the congressman to appear.
2) A “status proceeding” and a “hearing” are close enough for daily reporting, but whatever.
3) If Congressman Walsh is “very satisfied’ with the judge’s orders, then why did he fight so hard in court? What was the purpose of actively pursuing his ex by subpoenaing her employer to the point where she had to ask a judge to knock it off?
Walsh and his mouthpiece want to make the media the issue here. The issue, however, is Walsh.
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* Sanjay Jha’s golden parachute from Google is nearly the size of Illinois’ $100 million, ten year tax incentive deal agreed to earlier this year. Sheesh…
Motorola Mobility Chief Executive Sanjay Jha could get a $65.7 million payout related to the company’s deal to sell itself to Google for $12.5 billion.
The so-called golden parachute payment would include $13.2 million in cash and $52.4 million in equity related compensation, according to a filing with the Securities and Exchange Commission.
To celebrate this momentous occasion, feel free to caption this photo feature Jha and Gov. Pat Quinn…
* Meanwhile, the governor is preparing to leave for China tomorrow…
Quinn said an increase in exports will create more jobs in Illinois.
“I don’t think any state in the union that really wants to get more jobs should miss the opportunity to interact with other countries that either want to invest in our state or want to buy our goods and services. That’s part of the job of a governor nowadays, especially in the 21st century,” Quinn said.
Quinn said he plans to sign an agreement with China that would increase soybean exports. China, according to Quinn, is the third largest exporter for Illinois, behind Canada and Mexico.
The Governor also plans to visit Japan for a conference at the end of his trip to China. He is scheduled to return to Illinois on September 24.
At least our politics will calm down for a while.
* Finally, some heartening business news…
Venture capital investment in Illinois companies reached a record $1.45 billion last year and is on track to surpass that level in 2011, according to new data scheduled to be released Thursday by a group of four local organizations.
The numbers also show that $864.5 million has been invested during the first half of 2011. The lion’s share of investment, about $856 million, has flowed to the Chicago metropolitan area. […]
[Maura O’Hara, executive director of the Illinois Venture Capital Association] said the index should underpin the state’s efforts in drawing more investment activity from local and outside sources.
“Some of our political problems have not helped our image, but (with) the excitement over the last couple of years, particularly over Groupon, I’ve seen a lot of (venture capital firms) outside the state calling up and saying, ‘What’s going on in the state? Can you introduce me to some firms there?’” O’Hara said. “That’s not something that happened five years ago.”
* However…
Illinois home foreclosure activity rose 17.6 percent in August compared to the previous month.
A report released Thursday by Irvine, Calif.-based RealtyTrac shows Illinois with 12,493 foreclosure filings last month. Filings include default notices, auction-sale notices and bank repossessions.
The filings represent one in every 424 housing units in the state. That rate is almost 26 percent lower than in August of last year and eighth-highest nationally.
* Related…
* Woman’s dogged determination made lives better: So for four years, she lobbied and testified and twisted arms as forcefully as she could. With state Rep. Mary Flowers (D-Chicago) at her side to fight for the legislation, they succeeded in giving the people of Illinois the right to an impartial review of an insurer’s denial of medical treatment, including a 48-hour deadline in cases where a patient is critically ill. Gov. Pat Quinn signed the legislation last month. Why did this have to happen this way? Perhaps you didn’t know it, but before Polka’s crusade there was no law that required insurance companies to justify why they refused to pay for medical care or drugs ordered by a doctor — even if the patient would die without such care.
* Suit: State Farm covered up donations to justice who voted in its favor: Lawyers in a class-action case accuse insurance giant State Farm of defrauding the Illinois Supreme Court by covering up its support of the Republican candidate in the most expensive state judicial race in U.S. history.
* Quinn says McCormick Place union negotiations ‘going well’
* ComEd on outages: Maintenance isn’t the issue: “Right now a customer has to call us to tell us they have an outage. It’s ridiculous. The smart meters would automatically tell (the company) when somebody loses power,” McMahan said, explaining part of the reason the smart grid is needed.
* Village to ComEd: Amp up your service: [Downers Grove] has experienced 1,482 power outages since 2007. Equipment-related issues were the number one cause of these outages, according to the report.
* Coal-to-gas developer won’t lobby legislature: The developers of a coal-to-gas plant in Downstate Illinois say they will not lobby legislators to force the state’s utilities to purchase the synthetic gas their plant hopes to produce. Chicago-based Integrys Group, which owns utilities Peoples Gas and North Shore Gas, announced last week that they will not sign contracts to purchase the synthetic natural gas to be produced in Southeast Chicago by Leucadia National Corp. and by Power Holdings of Illinois in Downstate Jefferson County. In response to indications by Leucadia that it may lobby the legislature to force Integrys’ hand, Power Holdings — which has spent eight years lobbying for its project in Springfield — said it does not intend to follow that path.
* Environmental justice groups fight pollution problems on Southeast Side
* UAW extends Chrysler, GM contracts after missed deadline
* Verizon to expand 4G network to 5 Illinois markets
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*** UPDATED x1 *** 30 years to life?
Thursday, Sep 15, 2011 - Posted by Rich Miller
*** UPDATE *** From the US Attorney’s office…
“The government has not recommended a sentence publicly or privately, not withstanding news reports to the contrary. The government has submitted a calculation of the advisory sentencing guidelines, as it is required to do in all cases. The sentencing guideline formulas are established by the U.S. Sentencing Commission. The government submitted that calculation to the probation office as is standard practice and we will not comment on those calculations publicly.”
[ *** End Of Update *** ]
* Prosecutors say that Rod Blagojevich could get up to a life sentence in prison, according to Sun-Times sources…
Federal prosecutors argue Rod Blagojevich could serve 30 years to life in prison, sources say — a sentencing range that will be bitterly disputed by the former governor’s defense lawyers. […]
The range put forth by prosecutors is not set in stone, and their calculations sometimes differ from the amount of time they actually recommend that a judge give a defendant. […]
Before former Gov. George Ryan was sentenced for corruption in 2006, the U.S. Probation Office recommended a range of eight to ten years in prison. Prosecutors did not publicly disclose a sentencing range, but they argued Ryan should not receive less than ten years in prison. He wound up getting 6 ½ years. […]
In the prosecution’s calculations, the government says Blagojevich faces more time because he took the witness stand and allegedly obstructed justice, sources said. As governor, he was also leader of an enterprise, they will argue.
Blagojevich is scheduled to be sentenced October 6th, but that could be moved back.
* React…
Contacted by phone, Blagojevich’s attorney, Sheldon Sorosky, said a sentence that severe would be outrageous.
“The government’s recommendation is cruel and draconian. You would think he committed a murder or a rape,” he said.
Sorosky said his team will submit its own recommended sentencing guidlines that are much lower than 30 to life.
* While Soroski is probably right, keep in mind that defense lawyers and experts made these very same sorts of predictions about Bernie Madoff before he was given the maximum 150 years in prison…
Experts agree he probably won’t be spending three decades in jail.
“Thirty to life is never a sentence I’ve heard of in the context of public corruption. If that is taken literally, it would be unprecedented,” said Patrick Collins, former federal prosecutor. […]
The man who prosecuted Blagojevich’s predecessor says the government always tried to send a message at sentencing.
“In the George Ryan case, for example, when we did our calculations, we came up with 12 or 13 or 14 years. The judge gave him 6 and a 1/2. Not to say that is the ratio that will hold here, but everybody should understand this is the starting point. The government will clearly be on the aggressive side,” said Collins.
* How this works…
Both the defense and the prosecution make recommendations to the Probation Department, when it comes to a sentence.
The Probation Department, in turn, makes a recommendation to the judge. Judge Zagel considers everything from Blagojevich’s lack of financial gain
to his home life. Sentencing is scheduled for October 6th.
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The Governor’s veto of SB 1652 is disappointing
Thursday, Sep 15, 2011 - Posted by Rich Miller
[The following is a paid advertisement.]
SB 1652 provides an array of benefits to Illinois. It is about jobs, economic development, environmental protections, consumer benefits, regulatory reform, and a modern infrastructure. It is supported by an extraordinary cross-section of business groups, labor unions, environmental organizations and more.
The legislation has undergone more than 40 major revisions based on input from various parties.
Without SB 1652 there is:
• No consumer opportunity for enhanced energy efficiency and rebate programs, or significant savings from operational efficiencies that are passed on to customers.
• No additional union job creation or new business growth in Illinois to service smart grid and renewable projects.
• No major increase in grid reliability or established performance standards to hold utilities accountable.
• No easy path to facilitate more renewable energy such as solar into the grid.
• No opportunity for Illinois to realize a vision of an electric highway for future widespread electric vehicle use without smart meters.
SB 1652 does not guarantee profits or automatic rates increases and does not strip the ICC’s authority.
Illinois customers want more than the status quo. We look forward to working with members of the General Assembly to help make grid modernization and economic growth a reality.
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* A judge today ruled that Congressman Joe Walsh has to prove why he doesn’t owe $100,000 in back child support…
A judge in Chicago issued a preliminary ruling Wednesday against U.S. Rep. Joe Walsh (R-Ill.) in the Tea Party favorite’s child-support dispute with his ex-wife, ordering Walsh to explain why he appears to be $100,000 behind on his child-support payments.
Cook County Circuit Judge Raul Vega also wanted to know why Walsh wasn’t in court for the hearing — the McHenry Republican’s ex-wife, Laura Walsh was — and said he expects him to show up at the next hearing, in November.
Walsh’s new attorney, Janet Boyle, asked Vega “for what purpose” he wanted the congressman in court.
Vega gave her a puzzled look.
To which Boyle responded: “Mr. Walsh is a U.S. congressman.”
“Well, he’s no different than anyone else,” the judge said.
Ultimately, Laura Walsh’s attorney said the congressman probably wouldn’t have to come to court for the next hearing, after all.
Still, Vega said he was going to issue a “rule to show cause” why Walsh shouldn’t be held in contempt of court for falling behind, according to his ex-wife, by $100,000 in his child support over the past five years.
The effect of that ruling is that, instead of Laura Walsh having to prove that the congressman owes the money, now the burden shifts to the congressman to prove that he doesn’t owe money, according to attorneys for both Walshes.
The judge also stayed a subpoena that Walsh had filed of his ex-wife’s employer after Walsh’s attorney backed away from her attempt to force the ex to show exactly how much money she was making.
* Meanwhile, Congressman Jesse Jackson, Jr. is not pleased with this comment by potential primary opponent Debbie Halvorson…
Halvorson sounded very much like a candidate when she said, “He (Jackson) lives in D.C.. He doesn’t come home on weekends. His kids go to school in D.C.”
* Jackson’s response…
“I think it’s helpful when people leave people’s families and children out of political contests,” Jackson said. “People in my district are concerned about employment, they’re concerned about jobs, and I’ve been narrowly focused on that.” […]
Jackson said that because of the schedule set by GOP leaders, he puts his children in school in the nation’s capital. “If they weren’t here, I’d never see my children,” Jackson said. “I want to see my children. It comes with the real estate, it comes with the territory.”
He snapped that “other Members of Congress have grown children,” perhaps a veiled swipe at Halvorson, a mother of four. Her youngest child has graduated from college.
…Adding… Kinda related…
* Political groups owe Illinois $700k in overdue fines, with little reason to pay: The Illinois State Board of Elections posts on its website a list of overdue fines. Close to 200 political committees are there, ranging from the Putnam County Democratic Central Committee, which owes $25, to the Friends of William Burch, which owes $35,500.
* Candidate for Cook County office vows to clear up $17,500 in overdue fines: A politician running for a Cook County office on a message of reform owes more than $17,000 dollars to Illinois’ election board. Ald. Rick Munoz is promising to clear up the overdue fines. Munoz is listed as chairman of a couple campaign funds, including one called the 22nd Ward Independent Political Organization. The fund has racked up big fines this year for failing to file on-time campaign disclosure reports, which are supposed to list who gave the committee money, and how it spent that money. One of the reports was more than a year late. All together, the 22nd Ward campaign fund owes $17,500 in overdue fines to the state board of elections.
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A weird idea, to say the least
Wednesday, Sep 14, 2011 - Posted by Rich Miller
* Ummm…
What would you think of the Thompson Center downtown for a Chicago casino?
Chicagoland Chamber of Commerce president Jerry Roper says the high, glassy atrium in the state office building would make it ideal.
“It’s front-end loaded. It’s a burden to the state. And it could make a great casino on the first floor and the lower level and hotel rooms surrounding. That would be one site,” Roper said.
With those high ceilings, I gotta figure the place would be too noisy to bear. Then again…
“If you take a look at the casino that is in Montreal, you’ll see that it’s the old French Pavilion. Turned upside-down, it looks just like the State of Illinois building. We showed it to the governor and he made a note of a re-purposed use of state property. Think about that building. As old as it is, it’s going to have to have a major renovation. Maybe you’re better off just allowing somebody else to renovate it.”
Turned upside down? Turned inside out, maybe.
Thoughts?
* In other casino news, Gov. Pat Quinn might be getting himself into even hotter water with Mayor Rahm Emanuel…
Quinn’s latest criticism centers on the way casinos would be taxed under the legislation, as a major portion of that money is set aside each year for schools. That amounted to $328 million last year, according to Quinn’s office, but the governor says that will drop under the bill that needs his signature to become law.
As it stands, casinos are taxed on a sliding scale of 15 percent to 50 percent, depending on the amount of money they bring in. The legislation Quinn is weighing eventually would limit the rate to 40 percent for casinos raking in between $200 million and $300 million a year and 30 percent for those pulling down between $300 million and $350 million a year.
For casinos making more than $350 million a year, the tax rate would fall to 20 percent. It’s estimated that the lower rate would apply only to a casino built in Chicago because it is expected to bring in the most money.
The casino tax rates would fall before all of the new casinos came online, however, which leads to the estimated initial dip in gambling money going to the education fund.
As subscribers have known for weeks, Quinn has been talking privately for a while now about forcing a Chicago casino to pay a significantly higher tax rate. That’s a deal-killer for Emanuel, who believes the financials won’t work at a higher rate.
* Speaking of Quinn and trouble, this is from the Bond Buyer…
Illinois has selected Mayer Brown from among 18 law firms that submitted proposals to work as the state’s bond and disclosure counsel for the next two years.
The state’s procurement office made its choice public Monday in an award notice posted on its IllinoisBID website. Mayer Brown was chosen based on its top score, state debt manager John Sinsheimer said.
More from Crain’s…
Mayer Brown scored highest among the 18 law firms vying for the work, Mr. Sinsheimer said, adding, “I would say it was close.” Scoring was based on each firm’s bond disclosure experience nationwide, the team assembled for the Illinois work and a detailed description of how the state should handle its public disclosure requirements.
So, apparently, it was not only close but the ratings were subjective as well.
I posted these stories because some powerful Democrats reached out to me this week upset at Gov. Pat Quinn’s choice of attorneys. Mayer Brown partner Ty Fahner is the lead attorney on the Republican lawsuit against the new Democratic congressional map.
That’s just what Quinn needed to do. Yep. Hand out sweet, expensive goodies (indirectly) to the guy who’s probably more hated by the state’s Democratic congressional delegation than anybody else right now. Also, way to hobnob with Republicans, guv, after making such a big deal out of House Speaker Michael Madigan attending a fundraiser for US House Speaker John Boehner.
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* Forget about the political framing in this New York Times article, and think of the damage this could do to Illinois’ budget…
As Congress opens a politically charged exploration of ways to pare the deficit, President Obama is expected to seek hundreds of billions of dollars in savings in Medicare and Medicaid, delighting Republicans and dismaying many Democrats who fear that his proposals will become a starting point for bigger cuts in the popular health programs.
The president made clear his intentions in his speech to a joint session of Congress last week when, setting forth a plan to create jobs and revive the economy, he said he disagreed with members of his party “who don’t think we should make any changes at all to Medicare and Medicaid.”
Few Democrats fit that description. But many say that if, as expected, Mr. Obama next week proposes $300 billion to $500 billion of savings over 10 years in entitlement programs, he will provide political cover for a new bipartisan Congressional committee to cut just as much or more.
* Illinois’ budget simply cannot take a major hit on Medicaid without kicking a whole lot of people off the system. Period. End of story. Why? Read on…
Illinois had more poor people last year than it has had in nearly two decades, according to data released Tuesday by the U.S. Census Bureau that also showed the number of impoverished nationally at a new high.
More than 1.82 million people lived in poverty in Illinois last year, up from 1.69 million. That was the biggest number of poor since 1992 when there were 1.86 million people who were impoverished.
The poverty rate last year rose to 14.1 percent from 13.2 percent in 2009, data showed. […]
The report also revealed the percent of uninsured in Illinois rose to 14.8 from 14.2 in 2009. There were 1.91 million people uninsured in the state last year, up from 1.81 million. Nationally, 49.9 million Americans had no health insurance, or 16.3 percent, up from 16.1 percent, or 49 million.
Median household income in Illinois fell 5.5 percent to $50,761 last year from $53,743, the report showed. Nationally, it dropped 2.3 percent to $49,445, from $50,599. Since 2007, median household income has declined 6.4 percent. [Emphasis added.]
Oy.
* More misery…
“In the fiscal year that ended June 30, we serviced 5.1 million individual visits to our food pantries,” said Bob Dolgan, spokesman for the Greater Chicago Food Depository, which operates 650 pantries, soup kitchens and shelters in the city and Cook County. “You go back just three years ago, it was 3.2 million visits.”
Cuts to even relatively small government assistance programs are making it difficult to serve the growing numbers of poor, said Shurna, citing an 87 percent cut to an $11 million state program designed to prevent homelessness.
“So many people are just one catastrophe from becoming homeless, suddenly unable to make a house or rent payment because of unforeseen medical bills or some other emergency,” he said. “Now, because of this cut, 10,371 such people will not be helped.”
* Quote of the day…
“It’s a lost decade for the middle class,” said Sheldon Danziger, a poverty expert at the University of Michigan.
* Nearby state poverty rates…
Indiana 16.3 percent, Ohio 15.3 percent, Kentucky 17.7 percent, Michigan 15.5 percent, Missouri 14.8 percent, Wisconsin 9.9 percent.
* A very depressing national poverty rate graph…
* Meanwhile, the governor’s staff had to straighten out a nervous bond trader…
Quinn last week announced $313 million in budget cuts through the shuttering of seven state facilities and slashing 1,900 jobs. He pressed lawmakers to either increase spending in the $33 billion budget or reallocate funds to support the facilities.
Michael Brooks, a senior portfolio manager at Bernstein Global Wealth Management, slammed the governor’s comments, saying they might offset strides made this year to improve the state’s image in the investment community and lower its borrowing costs.
Brooks said the spread early this year of 250 basis points between five-year Illinois paper and triple-A rated debt has narrowed to 145 basis points in recognition of the state’s move to increase its income tax.
[llinois debt manager John Sinsheimer] said Quinn’s comments were directed specifically at the budgets for the various facilities being shuttered and not the overall budget.
But, hey, that’s probably what happens when you make a gigantic freaking public deal about a few million dollars in reallocations.
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Doing themselves no favors
Wednesday, Sep 14, 2011 - Posted by Rich Miller
* This latest Chicago Teachers Union effort at spin predictably didn’t work…
Chicago Teachers Union President Karen Lewis says Mayor Rahm Emanuel made a comment to her that included an obscenity during a heated discussion over lengthening the day at Chicago public schools […]
Activist the Reverend Paul Jakes has written a letter demanding the mayor apologize.
“I know that African-American women have been victims continuously down through the years of disrespect and we as an African-American community will not stand for it,” said Rev. Jakes.
But Alderman Emma Mitts said there’s nothing racial about it and and who knows what Lewis may have said to Emanuel.
“I know there’s two sides to every story, and somtimes three sides to every story. So what really went on,” said Mitts.
* Zorn looks at how the teachers union is doing itself no favors…
A simple for instance: Is the union for or against a longer school day?
Yes and no.
The union is in favor of it if the extra time is well-used — “we want a better school day,” is how CTU President Karen Lewis puts it — and if teachers get commensurately more money for putting in more hours. But they’re against it because Chicago’s instructional time is very similar to instructional time in similar cities and because objective research doesn’t back up the claims for longer school days. […]
The union often stresses the need to empower classroom teachers in making important educational decisions. But when City Hall began the recent effort to lengthen the classroom day by a majority vote of the teachers in individual schools, union leaders objected, called it union busting and filed suit on procedural grounds.
The teachers now look like confused obstructionists — part of the problem, not part of the solution — largely due to self-inflicted public relations injuries.
* A while ago, Zorn attempted to get to the bottom of the disagreement between Mayor Emanuel and the Chicago Teachers Union over how many instruction minutes per year kids are receiving…
The teachers union claims 55,260 minutes a year, the administration claims 52,360.
In a flurry of email and phone messages I tried to get the sides to reconcile these numbers — the difference amounts to 17 minutes a day — and concluded it has to do with whether you count “passing time” (time allocated for physically transitioning from one activity to another) as instructional time, which other school districts may also do.
In other words, the CTU is counting time spent in the hallways as instruction time.
* But after being played like a violin by the mayor, this bit of spin is the first time that the CTU has seemed to get ahead of the story…
Using the elite private school where Mayor Rahm Emanuel now sends his kids as a starting point, Chicago Teachers Union officials have crafted a proposed schedule that adds 75 minutes to the typical public elementary school student’s day.
The union’s latest salvo in the battle over a longer school day uses as a comparison point the schedule of one third-grade classroom at the University of Chicago Laboratory Schools, union officials said Tuesday.
Just like at what U of C kids often call “the Lab School,’’ the CTU proposal offers a well-rounded curriculum featuring far more art, music, physical education and other extras than most CPS kids now get and even includes the study of a second language.
Ultimately, the proposed CTU schedule would provide an even longer school day than the Lab School , where a third-grader’s tuition is $21,876. And it does so without requiring Chicago Public School teachers to add any minutes to their work day.
The union will need lots more PR like this to try to neutralize Emanuel. This, alone, won’t do it, of course. Emanuel is a driven, ruthless man who has the polls and the public behind him.
* But, President Lewis can’t seem to get that silly argument behind her…
Also on Tuesday, new information emerged about the four-letter fracas between Mayor Rahm Emanuel and the teachers union president in his City Hall office. The mayor is said to have used the F-word when pushing his plan during a heated exchange.
“This is obviously a demonstration and illustration of who he is. That’s what that is,” said Lewis.
“My view is this is a distraction from the major issue which is getting the kids an education and time in class learning,” said Emanuel.
But sources say she too screamed and swore during the meeting, something she doesn’t deny.
“I did not, um, I did not take it. Let’s put it that way,” said Lewis when asked if she cursed back.
It’s time she moved on to more important things. Just because a reporter asks a question doesn’t mean she has to answer it.
* Related…
* 2 more schools opt for longer days - 7 faculties have now bucked union on divisive issue
* City Enacting New Preschool Health Goals
* Emanuel to aldermen: Suggestion box is out on budget - Mayor needs to eliminate shortfall put at $636 million
* Goldman Sachs to provide $25 million in loans and grants to Chicago-area small businesses
* New city crime database goes online
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Careful what you wish for
Tuesday, Sep 13, 2011 - Posted by Rich Miller
* From the March 23, 2009 edition of the Jacksonville Journal-Courier’s editorial page…
Until we address the core issue of an ever-expanding state government with fewer workers to pay for it, Illinois will continue to deteriorate.
* Same editorial page, July 17, 2009…
The budget does include about $2.1 billion in spending cuts, with the possibility of an additional $1.1 billion in cuts later in the year. But these cuts merely postpone the inevitable day of reckoning.
* December 30, 2010…
Glaringly present by its absence is any real discussion about trimming the pounds of fat wobbling under the arms of state government.
* January 13, 2011…
At the same time, lawmakers do little to address the problem of gluttonous spending that got the state into a $15 billion hole. Rather, they simply “limit” spending — and we know how well that has worked in the past.
* Sept. 8, 2011…
Published reports indicate Quinn also will announce the closing of a handful of state facilities this week.
One of the powerhouse unions in the state — the American Federation of State, County and Municipal Employees, which represents about 30,000 people — has called on lawmakers to increase spending to avoid any cuts.
That would be a step backward after lawmakers already cut $1.5 billion out of what Quinn requested in fiscal year spending.
We’re empathetic with the pain that such closings and layoffs will bring, but cannot overlook the pain inflicted already on the private-sector workforce.
Any real attempt to address Illinois’ budget problems must reflect the realities that have existed in the private sector for years. Any real attempt cannot continue to reckless and carefree spending of money that simply isn’t there.
To do so would be at the expense of the people state government is supposed to serve.
* Not long after that last editorial was published, Gov. Pat Quinn announced the closure of Jacksonville Developmental Center. Here’s the paper’s editorial from September 12, 2011…
Hi, Gov. Quinn, it’s us.
I know we haven’t been on the best of terms lately, what with our occasional swipes against you on this very page.
Hey, at least you aren’t Rod Blagojevich, right?
Um, OK, we’ll get to the point.
You’re killing us.
Illinois generally, Jacksonville specifically.
Your announcement Thursday that unless lawmakers approve more money, you’ll close a prison, a juvenile detention center, three homes for the mentally ill and two centers for the developmentally disabled was a death knell for this region. […]
Gov. Quinn, Jacksonville has been hit hard by economic turmoil. Yes, everyone has, but hundreds upon hundreds of good-paying jobs have vanished from this city in the past two years. Gone with them has been an incredible pool of talent and of people to provide the vibrancy that makes a city a community.
* To be very clear here, I’m on record repeatedly saying that these proposed cuts are mainly theater and that I seriously doubt whether Quinn truly intends to follow through. Also, to be clear, the Journal-Courier has often offered up thoughtful, realistic and spot-on critiques of Illinois’ failure to get a handle on its budget. I mean, really, it’s no secret that our government has been a mess and even a failure. The paper is also far from alone in helping fan the “cut government now” flames. And it’s not the only media outlet which fanned those flames despite having state facilities and lots of state workers in its coverage zone. It just happens to be the only one of those papers which also has an easily accessible archive.
Even so, it’s always dangerous to demand cuts when your own community is a potential target. Just sayin…
* Related…
* JDC petition efforts mobilize
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Elgin hammered by Des Plaines casino
Tuesday, Sep 13, 2011 - Posted by Rich Miller
* There’s a simple reason why Las Vegas casino owners tear down their establishments and/or build new ones on such a regular basis. Gamblers love new casinos. It’s a silly sentiment, since slots are usually far tighter at expensive new casinos in order to pay for all that fancy construction. But gamblers aren’t exactly taking mathematically sound risks when they walk in the door.
Anyway, this story is not surprising on any level…
The new gambling palace in Des Plaines opened as the biggest money-maker among Illinois casinos, but some suburban leaders say the cost to existing establishments argues against further expansion of gambling.
In its first six weeks since opening July 18, Rivers Casino grossed almost $52 million, according to figures released by the Illinois Gaming Board.
But Rivers’ gain apparently came at the expense of existing Chicago-area casinos. The Des Plaines establishment earned almost twice as much as any other Illinois casino in August, and at all but one of the nine existing casinos, revenues for the month were down from the same time last year. […]
Tom Swoik, executive director of the Illinois Casino Gaming Association, said the reductions at other casinos showed the danger of a legislative proposal to open five new casinos, including one in Chicago, plus add slots at racetracks.
* The Gaming Board, in all its wisdom, chose Des Plaines at least partly because it was so close to Chicago, which is off-limits by law right now to a casino. The Board could’ve chosen a site nearer our Wisconsin or Indiana borders to attract out-of-state money, but the Board decided to focus on bringing in Chicago cash, which has now apparently resulted in cannibalizing the Elgin casino, the next closest site…
The [Elgin] Grand Victoria Casino’s revenues for August, down 24 percent compared to August 2010, are also down nearly 20 percent from just last month.
* But how much of that Elgin dropoff is cannibalization and how much should be laid at the feet of the lousy economy and the overall age of the facilities? Take a look at the August-to-August comparison for every Illinois casino…
They’re all down except Rock Island, which is, by the way, still a fairly new casino.
* The point here is that the cannibalization by Des Plaines of Elgin and other casinos is most likely occurring. However, the economy and the “newness” issue are also factoring in here.
And whatever cannibalization we’re seeing is purely the Gaming Board’s fault. They picked Des Plaines.
The General Assembly, on the other hand, has chosen to site new casinos that the Gaming Board chairman has repeatedly claimed will cannibalize existing locations. But that’s the GA’s prerogative, just as it was the chairman’s several years ago when the board chose the Des Plaines site. He should probably drop this line of argument.
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Question of the day
Tuesday, Sep 13, 2011 - Posted by Rich Miller
* Yesterday’s QOTD asked whether readers agreed with Illinois Chamber of Commerce CEO Doug Whitley’s statement…
Whitley said one of the problems facing Illinois is that “Cook County people are out of touch with the pain of the people of downstate Illinois.”
It was no surprise that Downstate readers nearly unanimously agreed (”agrees” are in green)…
What surprised me a little is that a majority of Chicago-area readers agreed as well…
Apparently, most Cook Countians are aware that they’re out of touch. Let’s expand on yesterday’s question…
* The Question: Do you think that one of the problems facing Illinois is that Downstate people are out of touch with the pain of the people of Cook County? Take the poll and then explain your answer in comments, please. Also, please tell us where you call home. Thanks.
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* U.S. Judge Joe Billy McDade recently overturned former Secretary of State official Cecil Turner’s four wire fraud convictions…
Cecil Turner was convicted on four counts of wire fraud in 2006 for covering up a scheme in which three janitors were paid for hours they didn’t actually work.
Turner did not take any illegal money. He was convicted on the legal theory that he denied taxpayers the honest services they deserved.
Since then, however, the U.S. Supreme Court has narrowed the scope of “honest services'’ violations.
* Some background on the case from Turner’s 2008 appeal, which was denied back then…
Led by Dinora, the three night janitors devised a scheme to take massive amounts of unauthorized leave without being detected by their supervisors. […]
The janitors’ scheme could not have succeeded without Turner’s help. Prompted by requests from Dinora, Turner repeatedly intervened when the janitors’ immediate supervisors began to watch the three more closely.
Turner filed motions in 2010 to vacate his convictions, mainly because of the Skilling v. United States ruling.
* More explanation of Judge McDade’s recent ruling…
Under the wire fraud statute, it is illegal to use interstate wires in any scheme to defraud, or for obtaining money or property by means of false pretenses, representations or promises. A scheme to defraud may include a scheme to deprive someone of “honest services”
In the Skilling opinion, the high court narrowed the scope of the right of “honest services” to include only cases involving bribes or kickbacks.
There was no evidence that Turner received any kickbacks or otherwise personally profited from the janitors’ scheme.
McDade said in his opinion that the court couldn’t determine whether or not the jury’s verdict on the wire fraud charges was based on a monetary scheme to defraud or the now-improper ground of honest services fraud.
* There was a monetary angle to the original case, but it was pretty darned minor and tenuous…
Federal prosecutors alleged Turner helped the janitors pocket unearned state pay in exchange for special treatment by city trash collectors in his Springfield neighborhood.
Turner received no financial kickbacks, but aided in the scheme because one of the janitors - Dana Dinora - also worked for Springfield’s public works department. He allegedly arranged quick pickups of junk ranging from water heaters to a dog house for Turner and his neighbors, Chesley said. […]
[Turner’s lawyer] told jurors special trash pickups in Turner’s neighborhood were arranged by another city employee, not Dinora, and are common for people with political connections. Turner is vice chairman of the Sangamon County Democratic Party and his wife a Sangamon County Board member.
* Interestingly enough, the appellate court had earlier used its reasoning from the Robert Sorich conviction to deny Turner’s original 2008 appeal…
The defendants in Sorich had misused their public offices for the private gain of third parties-campaign workers who were given civil-service jobs. This was sufficient, we said, because “the true purpose of the private gain requirement-and one that does not depend on who gets the spoils-is to prevent the conviction of individuals who have breached a fiduciary duty to an employer or the public, but have not done so for illegitimate gain.”… Because the defendants in Sorich had “created an illegitimate, shadow hiring scheme based on patronage and cronyism by filling out sham interview forms, falsely certifying that politics had not entered into their hiring, and covering up their malfeasance,” the “hallmarks” of an honest services fraud were present.
* Turner’s two convictions for lying to the FBI were allowed to stand by Judge McDade, however. Here’s what the appellate court wrote in 2008 about that…
On appeal, Turner contends that his statements to the FBI were not material because the FBI already knew about his involvement in the scheme and therefore could not have been misled by what he said.
We disagree.
A false statement need not actually influence the agents to whom it is made in order to satisfy the materiality requirement for this offense; it need only have the possibility of influencing a reasonable agent under normal circumstances. Turner’s statements to the FBI-denying that he provided supervisory cover for the janitors’ fraudulent scheme-satisfied this standard.
* Meanwhile, in a different part of the state, US Attorney Patrick Fitzgerald was in rare form yesterday…
U.S. Attorney Patrick Fitzgerald said he sometimes wants to smack people “upside the head” who tell him after he’s convicted someone that they knew all along the person was a crook.
“Seriously, speak up,” Fitzgerald said in a talk to the City Club of Chicago Monday.
“The one thing I find frustrating is that people view corruption as a law enforcement problem. If I had a dollar for everyone who has come up to me after we’ve convicted someone and said: ‘yes, we knew he or she was doing that all the time but we wondered when someone was going to get around to doing something about it. And I bite my lip, but I wanted to smack them upside the head.”
The person who needs to do something about corruption, he said: “was you.”
“It is my view that sometimes we say that’s the way it is in Illinois or that’s the way it is in Chicago. If you’re finding yourself saying that, what you’re really saying is: “that’s the way I will allow it to be,” Fitzgerald said.
“You either speak up and do something about it or you’re part of the problem. That’s the only way to look at it.”
Discuss.
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Governing by press release, Part 54,285
Tuesday, Sep 13, 2011 - Posted by Rich Miller
* I have some objections to this Tribune editorial, but it’s generally on the right track…
Gov. Pat Quinn slammed down a rubber stamper with a dramatic thud Monday as he followed through on his pledge to veto the so-called smart grid bill, which would upgrade the electricity distribution system in Illinois.
Now what? Apart from talking tough — and stamping tough — the governor has no real Plan B. […]
The bill needs a stronger answer for the prolonged power outages that hit more than a million customers in northern Illinois this summer — they’re still angry. An aggressive program to replace cable, upgrade circuits and bury the most vulnerable lines should be part of the deal. ComEd might win more support if it revived the idea of a fund to ease the impact of future rate hikes on the elderly and poor.
The storm-related service problems have made ComEd an easy target, and opponents of the bill looked like they had fun bashing it on Monday. But as the governor should know, this legislation is not “a nightmare for the consumers of Illinois,” as he described it. It is not “legalized pickpocketing,” or a bet on “unproven smart technology,” as Attorney General Lisa Madigan declared at the press conference.
The General Assembly passed a largely solid framework. High-tech upgrades to the power grid will save consumers money over time and make Illinois more attractive for business. The governor gave his veto stamper a good workout on Monday. Now it’s time to push for a genuine electricity upgrade.
I don’t think the bill’s framework was “largely solid.” What we saw over the summer is that the basic structure of the current “Dumb Grid” isn’t nearly up to par. The company needs to be pushed into upgrading its entire network from the ground up, not just the technological improvements produced by a “Smart Grid.” Yes, that would cost money. Lots of it. But these far too frequent outages are also costing money as well, and they’re hurting our state’s competitiveness. We have an opportunity here to squeeze this company to be the best in a whole lot of aspects. For instance, their customer service is horrible, and not just for individual consumers…
For the third year in a row, business customers have placed Commonwealth Edison second-to-last in customer satisfaction among its Midwest peers.
According to a J.D. Power and Associates study — based on interviews with representatives of more than 17,000 U.S. businesses that spend between $500 and $50,000 monthly on electricity — ComEd tied for second-to-last place with the state’s other major utility Ameren Illinois. Both received a score of 607 on a 1,000 point scale.
And guess which company tied for last place in the Midwest? If you said “Ameren,” you’d be correct.
* Gov. Pat Quinn has had months to come up with an alternative plan. Instead, he just issued a veto and walked away, promising to come up with something down the road.
That’s absolutely unacceptable. Yesterday was simply one more in a series of high-profile feel-good media pops for a governor who all too often governs by press release. Vetoing the ComEd bill was easy. Proposing real solutions is difficult. So, it’s no surprise which avenue this governor took.
Maybe one day Pat Quinn will grow up and start to actually lead, but I’m not holding my breath.
…Adding… The SJ-R editorial board is still steaming about Tenaska…
If a newspaper editorial page could have a face, ours would be blue from telling the story of Commonwealth Edison’s relentless effort to prevent construction of a clean coal power plant in Taylorville. […]
A group called the STOP Coalition, heavily backed by Exelon, quickly set about sounding the alarm of economic doom if that happened. Using worst-case-scenario predictions, it said the Tenaska deal would lead to massive increases in power rates for nonresidential users, forcing tens of thousands of jobs out of Illinois. ComEd succeeded in stopping Tenaska’s bill in January. Then it asked the Illinois Commerce Commission for its own $396 million rate hike. (Eventually, it was granted $155 million.)
The Tenaska bill limited Tenaska to a 2 percent increase on residential rates spread over 30 years . The bill vetoed by Quinn this week would have meant 9 percent increases on average for ComEd customers.
This episode was a lesson for us. It said ComEd would do anything necessary to protect its bottom line and keep competition away, no matter how much hyperbole and alarmism was necessary.
* Roundup…
* ComEd Customer Service - User Reviews, Ratings and Comments
* Sen. Don Harmon statement on governor’s ComEd veto: “By vetoing this bill, the Governor paves the way for common sense legislation that can allow for electric grid modernization, while providing true safeguards for Illinois’ consumers. I stand with the Governor in his efforts to create jobs, protect the environment and maintain key consumer protections. The lack of adequate protections in these key areas is the reason I voted no on the ‘ComEd bill’ and today support the Governor’s veto. To be effective, any legislation to modernize the electric grid should contain lower profit margins for utility companies, key protections for those who can least afford rate increases, dedicated revenues for storm response measures, environmental safeguards, and clear evidence that ratepayers will realize future savings from smart meters.”
Unless a trailer bill can be passed to address these specific concerns, I urge legislators to support the veto. I look forward to working with the General Assembly to advance these goals.”
* Gov. Quinn vetoes ComEd rate-hike bill, override battle to come: Bob Pierson, business manager of IBEW Local 9 and chairman of the union’s International Executive Council, said he is disappointed and that the IBEW will continue to try to pass the bill in the upcoming veto session. “There are no jobs now,” he told the Sun-Times. “This would have meant at least 1,500 jobs for our members, more jobs for the utility company, more income for the state and given the state an actual, reliable [electrical] system.”
* Quinn vetoes electric rate hike bill: “If they want to try and override the veto, be my guest. Because we’ll, I think, show them as we did 30 years ago that the people of Illinois are mightier than Commonwealth Edison,” said Quinn, who helped form the Citizens Utility Board nearly 30 years ago.
* Quinn vetoes ComEd rate hike: In December 2008, the ICC ordered the state’s two largest utilities — ComEd and Ameren — to participate in a series of workshops with consumer advocates, government officials and other policymakers to discuss issues surrounding smart grid. The idea was to develop a strategic plan to guide deployment of smart grid in Illinois and to recommend policies the commission could adopt. The resulting 356-page report, released in October 2010, was meant to guide utilities as they moved forward with requests for smart-grid technology. But the utilities never came forward with a detailed proposal, said Scott, instead choosing to fight for legislation that would provide a means to pay for the smart grid without clearly defining what consumers would be paying for.
* ‘Smart Grid’ Might Invade Privacy: ComEd released a statement denying that personal data would be collected: “The parties that negotiated the Energy Infrastructure Modernization Act (SB1652) ensured that customer data information protections were embedded in the legislation. The legislation says that electric utilities shall comply with the consumer privacy requirements of the Personal Information Protection Act and it prohibits selling of individual customer-specific data. ”
* Quinn vetoes electricity rate-hike plan: “To be effective, any legislation to modernize the electric grid should contain lower profit margins for utility companies, key protections for those who can least afford rate increases, dedicated revenues for storm response measures, environmental safeguards, and clear evidence that ratepayers will realize future savings from smart meters,” said state Sen. Don Harmon, an Oak Park Democrat.
* Quinn vetoes Ameren rate hike proposal
* Quinn vetoes Ameren $625 million rate hike bill in Illinois
* With Quinn veto, ComEd’s focus on rate hike bill turns to lawmakers
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* You can look at charts and treatises all day long and still not quite get your head around the problem of America’s stark inequities. This incredibly important Wall Street Journal article, however, brought it all home for me…
For generations, Procter & Gamble Co.’s growth strategy was focused on developing household staples for the vast American middle class.
Now, P&G executives say many of its former middle-market shoppers are trading down to lower-priced goods—widening the pools of have and have-not consumers at the expense of the middle.
That’s forced P&G, which estimates it has at least one product in 98% of American households, to fundamentally change the way it develops and sells its goods. For the first time in 38 years, for example, the company launched a new dish soap in the U.S. at a bargain price. […]
Economist Edward Wolff of New York University estimates that the net worth—household assets minus debts—of the middle fifth of American households grew by 2.4% a year between 2001 and 2007 and plunged by 26.2% in the following two years.
P&G isn’t the only company adjusting its business. A wide swath of American companies is convinced that the consumer market is bifurcating into high and low ends and eroding in the middle. They have begun to alter the way they research, develop and market their products.
Food giant H.J. Heinz Co., for example, is developing more products at lower price ranges. Luxury retailer SaksInc. is bolstering its high-end apparel and accessories because its wealthiest customers—not those drawn to entry-level items—are driving the chain’s growth.
Citigroup calls the phenomenon the “Consumer Hourglass Theory” and since 2009 has urged investors to focus on companies best positioned to cater to the highest-income and lowest-income consumers. It created an index of 25 companies, including Estée Lauder Cos. and Saks at the top of the hourglass and Family Dollar Stores Inc. and Kellogg Co. at the bottom. The index posted a 56.5% return for investors from its inception on Dec. 10, 2009, through Sept. 1, 2011. Over the same period, the Dow Jones Industrial Average returned 11%.
“Companies have thought that if you’re in the middle, you’re safe,” says Citigroup analyst Deborah Weinswig. “But that’s not where the consumer is any more—the consumer hourglass is more pronounced now than ever.” […]
To monitor the evolving American consumer market, P&G executives study the Gini index, a widely accepted measure of income inequality that ranges from zero, when everyone earns the same amount, to one, when all income goes to only one person. In 2009, the most recent calculation available, the Gini coefficient totaled 0.468, a 20% rise in income disparity over the past 40 years, according to the U.S. Census Bureau.
“We now have a Gini index similar to the Philippines and Mexico—you’d never have imagined that,” says Phyllis Jackson, P&G’s vice president of consumer market knowledge for North America. “I don’t think we’ve typically thought about America as a country with big income gaps to this extent.”
Procter & Gamble is one of the smartest marketers in the world. If this is how P&G now sees our country, you can bet it’s accurate. We really are in serious trouble here.
Go read the whole thing.
* And here’s another important story that you shouldn’t pass by…
Caterpillar Inc. is struggling to add skilled workers in its manufacturing operations despite high U.S. unemployment levels that have forced President Barack Obama to take extraordinary measures, the company’s chief executive said on Friday.
The dichotomy in the makeup of the workforce is threatening U.S. and Canadian competitiveness, Caterpillar CEO Doug Oberhelman said.
“We cannot find qualified hourly production people, and for that matter many technical, engineering service technicians, and even welders, and it is hurting our manufacturing base in the United States,” he told a business audience at the Spruce Meadows equestrian facility outside Calgary.
“The education system in the United States basically has failed them and we have to retrain every person we hire.”
* Related…
* Social Status and How the Elected Vote
* Capital gains tax rates benefiting wealthy feed growing gap between rich and poor
* Steel company moving HQ to Chicago: An Ohio steelmaker is in line to receive more than $1 million in financial incentives from the city of Chicago to move its headquarters to a downtown office tower… In addition to the 50 jobs that will move from JMC’s Beachwood, Ohio headquarters, the company, which makes steel pipes and tubes, plans to retain 50 corporate jobs already in Chicago that could have moved to Ohio.
* Community college enrollment falling in Illinois
* Battle Lines Being Drawn In Push For Longer School Day
* Illinois teachers union official blasts CPS longer-day tactics
* Mitchell: Rahm Emanuel right to be a bully about a longer school day
* Crop yield estimates cut due to weather conditions
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