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* This is such a weird state. The governor vetoes a budget and a tax hike and the bond markets rally because traders figure the General Assembly will ignore him…
Illinois bonds surged as the legislature moved closer to ending a record-long impasse over the budget, reducing the risk that the state’s bond rating will be cut to junk.
The rally came after the state senate overrode Governor Bruce Rauner’s veto to approve tax increases and the first full-year budget in two years, sending the measures to the House of Representatives. Without a spending plan in place, Illinois had been squeezed by chronic deficits and credit-rating companies warned that they may withdraw the state’s investment-grade rank, a step that could have prevented some investors from buying its debt.
“It does look good — it looks like the momentum is there,” said Gabriel Diederich, a portfolio manager at Wells Fargo Asset Management, which has Illinois debt among municipal bond holdings. “When you get shreds of fiscal management and fiscal prudence, even small steps have been greeted positively.”
The average price of taxable general-obligation bonds due in 2035, the most actively traded, jumped 6.5 percent to 110.5 cents on the dollar Wednesday, the highest since the end of October. That pushed the yield down to 6.36 percent from about 7 percent on July 3. The state’s bonds were the most heavily traded municipal securities Wednesday.
* Meanwhile, the Tribune editorial board makes a last-ditch effort to stop the override…
Members of the Illinois House, the decision falls to you. Will you override Gov. Bruce Rauner’s veto of a permanent, 32-percent increase in the personal income tax? Or will you instead insist, first let’s agree on the reforms that many of us promised voters would have to be part of any tax deal?
We ask because if you vote this tax increase into law and then have to admit to your constituents that accompanying “reform” bills are really just diluted eyewash, you’ll look like chumps for Speaker Michael Madigan.
At this writing, an override looks like a terrible risk for you. We say this not because we’re reflexively opposed to tax increases — we aren’t. We say it because Illinois citizens need offsetting fixes from Springfield. Otherwise you’ll own the same old state government and weak Illinois economy, but at a price you’ve just raised by 32 percent. […]
So, House members, if you’ve delivered solutions — on property taxes, on pensions, on work comp, on government bloat in Illinois — then maybe you should vote to override Rauner’s veto.
The Tribune argues that the budget chaos should continue until the governor’s reforms are enacted, but 16 Republicans specifically voted to end that insane and protracted chaos.
You’re going to see a whole lot more arguments like this before tomorrow’s expected override vote.
* Related…
* McSweeney files bill to repeal Illinois House’s permanent income tax hike
posted by Rich Miller
Wednesday, Jul 5, 17 @ 11:59 am
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The betting money is on reality and Madigan. The political money hasn’t decided yet.
Comment by VanillaMan Wednesday, Jul 5, 17 @ 12:09 pm
I like how McQueary can’t QUITE bring herself to explicitly endorse junk status and a continued shut down so she just whines a lot (hi Kristen! I’m still correct about the IL budget. A tax hike was necessary a decade ago and it still is!).
Also that having less money via a tax hike is compensated by something other that receiving money. That is not how money works!
Comment by Will Caskey Wednesday, Jul 5, 17 @ 12:09 pm
“The Tribune argues that the budget chaos should continue until the governor’s reforms are enacted”
A very curious bunch, that Tribune Editorial Board.
– MrJM
Comment by @MisterJayEm Wednesday, Jul 5, 17 @ 12:11 pm
To me?
It’s no different than Kristen McQueary begging for a hurricane to destroy lives, so her idea of Utopia could begin, no matter how many people are hurt, no matter the permanent damage a hurricane delivers.
When I look at this editorial as wishing for no budget, no social services being saved, no higher education outlasting the continued budget stalemate… Kristen McQueary, “@StatehouseChick”, already signaled what thus editorial board would say here, and they don’t disappoint.
It’s about wishing for continued destruction to begin policies that have not enough support to be.
As @StatehouseChick tweets … “Simple”
Comment by Oswego Willy Wednesday, Jul 5, 17 @ 12:12 pm
Madigan and John will be asking for another tax hike after the 2018 elections because the issues that got us here have not been taken care of. No reforms = another tax hike. Illinois will be taxed out of existence.
Comment by Dandy Edward Wednesday, Jul 5, 17 @ 12:14 pm
===Madigan and John will be asking for another tax hike after the 2018 elections because the issues that got us here have not been taken care of. No reforms = another tax hike. Illinois will be taxed out of existence.===
Since you know about all this taxing and Illinois out of existence thingy, who will win the next couple Stanley Cups, Super Bowls, and World Series?
‘Cause, calling your shot on existence seems a bit… over the top… so I figure, get some things to bet on.
Comment by Oswego Willy Wednesday, Jul 5, 17 @ 12:16 pm
“Illinois will be taxed out of existence”
So, like, it’ll just be a black hole on the map? Taxes can do that? Holy crap, that IS terrifying.
Comment by Ace Laredo Wednesday, Jul 5, 17 @ 12:17 pm
Who will be the Republican Minions for Mike?
Comment by Anonymous Wednesday, Jul 5, 17 @ 12:18 pm
I suspect they will ask for a progressive tax amendment before they seek another tax hike. The Democrats can use the new tax hike as a selling point. “If you are middle class, and would like to see your taxes drop, then enact this progressive tax amendment.”
Comment by A Jack Wednesday, Jul 5, 17 @ 12:21 pm
===Who will be the Republican Minions for Mike?===
15 of 51 is about 30% of the HGOP wanting schools opened, universities accredited, social services paid.
I’m with the “Brave 15″ all day, every day, twice on Sunday.
Enough is enough.
Comment by Oswego Willy Wednesday, Jul 5, 17 @ 12:21 pm
The party is over and everyone has left and the Trib is still pounding away at the same sorry song. Be brave legislators but only in the way we tell you to be, also be very very scared of Ma Blue. Please.
Comment by Anonymous Wednesday, Jul 5, 17 @ 12:25 pm
=who will win the next couple Stanley Cups, Super Bowls, and World Series?=
That’s easy…Blackhawks, Bears and Cubs.
Comment by enoughalready Wednesday, Jul 5, 17 @ 12:25 pm
=== No reforms = another tax hike. ===
Pray tell, how would a permanent property tax freeze and term limits prevent another state tax hike?
Comment by anon2 Wednesday, Jul 5, 17 @ 12:32 pm
–Or will you instead insist, first let’s agree on the reforms that many of us promised voters would have to be part of any tax deal?–
Is the Book of Secrets on the projected ROI of Rauner’s agenda hidden in Trib Tower? Behind one of those stolen stones from iconic world structures, perhaps?
Maybe the tronclodytes could share the benefits with us, beyond the incoherent screwball talking points of the last two years.
Either way, the troncs should retrieve the Book of Secrets from the Tower before the new owners toss them out on the street next year. Wouldn’t want that deep knowledge they demonstrate every day to get into the wrong hands.
Comment by wordslinger Wednesday, Jul 5, 17 @ 12:35 pm
== No reforms = another tax hike.==
“Cuts”. You mean “cuts”. Not reform. Like, term limits ain’t gonna do a damn thing about the budget. If you can only stick around for ten years anyway, you’re not gonna think too long-term. Have courage in your convictions, man. And specify the cuts, being mindful of all the stuff we’ve learned over the last three years that just can’t be cut.
Comment by Arsenal Wednesday, Jul 5, 17 @ 12:37 pm
enoughalready–Blackhawks and Cubs I can buy. Now about the Bears….
Comment by Ajjacksson Wednesday, Jul 5, 17 @ 12:38 pm
She can never top the Hurricane Katrina piece but who remembers the Susana Mendoza is a big meanie and should pipe down piece?
Comment by P. Wednesday, Jul 5, 17 @ 12:42 pm
–She can never top the Hurricane Katrina piece but who remembers the Susana Mendoza is a big meanie and should pipe down piece?–
How’s about all of Rauner’s proposed budgets were balanced?
Prior to that, she chastised those who called out Rauner’s unbalanced budgets as “pointdexters” who were missing the big picture.
She aspires to sophistry, she achieves hackdom.
http://www.chicagotribune.com/news/opinion/commentary/ct-rauner-balanced-budget-democrats-perspec-1125-20161123-story.html
https://capitolfax.com/2016/05/06/kristen-mcqueary-discovers-her-inner-poindexter/
Comment by wordslinger Wednesday, Jul 5, 17 @ 12:50 pm
Chain them to the ship when it sinks and see how they like it then.
Comment by Precinct Captain Wednesday, Jul 5, 17 @ 12:57 pm
Making that last tax hike temporary was a stupid thing to do.
Comment by Cheryl44 Wednesday, Jul 5, 17 @ 1:01 pm
==We say this not because we’re reflexively opposed to tax increases — we aren’t. ==
We say this, because we reflexively regurgitate the governor’s talking points.
Comment by Roman Wednesday, Jul 5, 17 @ 1:01 pm
===…Susana Mendoza is a big meanie and should pipe down piece?===
Let’s put this to bed.
Unless those making the Ad think they are smarter than the “Seinfeld” writers by actively choosing to use Guacamole instead of plain white, apparently, onion dip…
There’s nothing funnier than changing the type of dip to by happenstance try and convey another message. That’s knee slapping comedy there… or something else.
You wanna change dips to be funny, sometime Karma means reminding those that they aren’t funnier by changing a “Seinfeld” bit.
Kristen McQueary, as a reporter covering this state and the politics within this state must be confused how @StatehouseChick routinely ignores the institutional knowledge the reporter Kritsen McQueary apparently forgot when joining the Editorial Board.
The eerie similarities between the Hurricane McQueary wanted, and that destruction and this editorial and the ramifications of not overriding and the rationale, way too coincidental as an Editorial Board sees, collectively, as the right answers
Comment by Oswego Willy Wednesday, Jul 5, 17 @ 1:02 pm
The Tribune editorial board is a purveyor of bad ideas. When they claim something, it usually means it’s terrible for the average Illinois citizen and horrible for the State as a whole.
Comment by RIJ Wednesday, Jul 5, 17 @ 1:03 pm
The cuts-only Tea Party wing of the GOP caucus in concert with the moderates still wary of Rauner’s threats are not going to go down quietly. Those representing communities on the brink and interestingly, a former mayor who knows what it takes for a government to function will likely stand by their convictions and sensibilities.
Looking forward to looking forward rather than fearing it. Otherwise junk it and shut it down.
Comment by Markus Wednesday, Jul 5, 17 @ 1:04 pm
So, Illinois was already top 5 in state and local tax burden. will this make us #1?
Comment by Ron Wednesday, Jul 5, 17 @ 1:13 pm
RIJ, the average Illinois taxpayer carries one of the highest state and local tax burdens in the country. This tax increase only makes it worse for the average Illinoisan.
Comment by Ron Wednesday, Jul 5, 17 @ 1:14 pm
Why didn’t they cut 10% across the board instead of 5%?
Comment by Ron Wednesday, Jul 5, 17 @ 1:16 pm
The Trib is giving some House R’s, especially the suburban three, a last chance to repent and sin no more.
They should take it– all of the R’s who voted like D’s to raise taxes without reforms — because their constituents are very, very unhappy.
Comment by Deft Wing Wednesday, Jul 5, 17 @ 1:19 pm
==Why didn’t they cut 10% across the board instead of 5%?==
You’re a moderate squish. They shoulda cut 20%.
Comment by Arsenal Wednesday, Jul 5, 17 @ 1:21 pm
Are the Governor’s buddies buying up the bonds before the interest rates drop?
Comment by Leadership Wednesday, Jul 5, 17 @ 1:21 pm
What’s interesting about those who wish for the doom, like Katrina and Bruce D., is their great confidence that they’ll be the ones who come out of it just fine. So eager to roll the dice and never pausing to consider the potential for negative consequences that might touch their lives in unexpected ways.
Am also highly amused by their apparent belief that, by virtue of their insulated, walnut-paneled tower perches they are actually part of the wealthy elite, rather than merely its vassals. And, push comes to shove, said elite would be just as happy to cast them aside without a second thought. As Mitt Romney put it so well for his fellow 0.1%ers, “I like being able to fire people who provide services to me.”
Comment by Moe Berg Wednesday, Jul 5, 17 @ 1:24 pm
===because their constituents are very, very unhappy===
Craven politicians will only support whatever tests well in polls. Sometimes, you just gotta tell people that the fiscal tooth fairy doesn’t exist.
Comment by Rich Miller Wednesday, Jul 5, 17 @ 1:26 pm
===They should take it– all of the R’s who voted like D’s to raise taxes without reforms — because their constituents are very, very unhappy.===
Thoughtful representatives see where their party is wrong, and then vote against what others think will make their constituents “very, very, unhappy”
Like the 4 GOP members that voted for SSM. Do you think they should have felt the wrath, or did they sin by not voting as the party wanted?
Comment by Oswego Willy Wednesday, Jul 5, 17 @ 1:30 pm
Ms. McQueary publicly wished for the destruction of the third largest American city, hoping for chaos, tragedy & heartbreak. Her wishes were published and promoted by the Tribune.
The Tribune Editorial Board endorsed Gary Johnson for President of the United States in 2016.
It’s mind-boggling that anyone listens to these people.
Comment by northsider (the original) Wednesday, Jul 5, 17 @ 1:53 pm
I don’t buy or click Tribune stories anymore unless they’re written by Zorn.
Comment by doggonit Wednesday, Jul 5, 17 @ 2:10 pm
==I suspect they will ask for a progressive tax amendment before they seek another tax hike. The Democrats can use the new tax hike as a selling point. “If you are middle class, and would like to see your taxes drop, then enact this progressive tax amendment.”== Agreed. A permanent tax hike sets the table for a move to progressive tax rates so that the majority of the population can get a tax cut.
Comment by SAP Wednesday, Jul 5, 17 @ 2:13 pm
=They should take it– all of the R’s who voted like D’s to raise taxes without reforms — because their constituents are very, very unhappy.=
In the end they need to put the blame where it belongs - math. Math said that 90% wasn’t good enough. Math said that there weren’t enough D’s (and maybe R’s) to give Rauner the 10 out of 10 he demanded. Math ultimately said that we have to bring in enough to pay our bills. Math required 60/30. Math ultimately dictated that even with a $3B cut in spending we still needed a tax increase. So if anyone is to blame it’s math.
Comment by Pundent Wednesday, Jul 5, 17 @ 2:14 pm
They should elminate corporate income taxes altogether with progressive personal income taxes.
Comment by Ron Wednesday, Jul 5, 17 @ 2:30 pm
Katrina Kristen McQueary and Bruce Dold can lead an expedition for their Tribune colleagues in search of their long lost credibility and gravitas. If Madigan doesn’t have the votes for the override, what do the Tribsters suggest? Oh that’s right, they’re in favor of a complete meltdown or catastrophic event. They should know, look at the wreckage that they inflicted on the Tribune.
Comment by Trapped in the 'burbs Wednesday, Jul 5, 17 @ 2:34 pm
As a life long Republican represented by Rep Jimenez, this constituent is very happy that she showed the courage to do what was needed. I sent her a message stating how I felt and that she definitely still has my vote.
Comment by Jmo Wednesday, Jul 5, 17 @ 2:35 pm
The Trib edit board gets a 10 for consistency but dons a dunce hat for its inability to understand the brained of eliminating red ink.
Comment by Winnin' Wednesday, Jul 5, 17 @ 2:56 pm
I wear a dunce hat for not proofreading. Brained is supposed to be Business.
Comment by Winnin' Wednesday, Jul 5, 17 @ 2:58 pm