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* My weekly syndicated newspaper column…
After the Illinois House and Senate voted to pass legislation to partially pay down the state’s unemployment insurance trust fund debt, top Democratic leaders gathered for a Statehouse press conference to boast about their accomplishment.
Yes, they admitted, it was only a partial pay down. The debt is $4.5 billion, and they patched it with $2.7 billion in federal money from the American Rescue Plan Act. But the Democrats pointed out Illinois is using a higher percentage of its federal ARPA aid on its debt than surrounding states, including Indiana.
Most states had to borrow money from the federal government when the 2020 COVID shutdowns created an unprecedented flood of unemployment benefit applications, and states simply didn’t have enough money on hand to meet the enormous demand. But the Democratic spin avoided the fact that surrounding states didn’t have the same level of crushing debt as Illinois.
While Indiana and Illinois both underfunded their trust funds before the pandemic, Indiana’s resulting problem wasn’t as great as Illinois’ partly because that state was more aggressive than Illinois about reopening businesses earlier in the pandemic. But that Hoosier decision came with a different and much more devastating cost, because Indiana’s COVID death rate is significantly higher than in Illinois rate, and it’s even higher when you look at the figures after vaccines were widely available.
Perhaps more to the point, Indiana and other states, unlike Illinois, used a significant chunk of their Trump-era CARES Act allotment to pay down their trust fund debts, so their resulting need for ARPA money to shore up their funds just wasn’t as critical as ours. Illinois’ budget situation at the height of the pandemic was, of course, worse than surrounding states because of decades of fiscal mismanagement here, so the CARES Act money was desperately needed elsewhere.
Business groups were generally upbeat after the bill’s passage. A joint business statement called the legislation a “positive step” toward “addressing” the “massive” shortfall in the trust fund.
“We’re hopeful that negotiations will continue to resolve the remaining balance of this unprecedented deficit,” said the statement from the Illinois Retail Merchants Association, Illinois Manufacturers’ Association, Illinois Chamber of Commerce, Chicagoland Chamber of Commerce, National Federation of Independent Businesses of Illinois and the Associated General Contractors of Illinois.
The appreciation from business groups was definitely not matched by the Republicans’ tone. They fretted that since all the debt wasn’t eliminated, the rest would have to come from employer tax hikes and worker benefit cuts. Senate Republican Leader Dan McConchie issued a statement predicting the bill will have a “devastating” impact on businesses — the same businesses whose industry representatives called the bill a “positive step.”
The Republican crocodile tears over potential benefit cuts for unemployed workers is super rich for a party that almost uniformly demanded those very same unemployment benefits be slashed last year so the resulting poverty would force people back to their lousy jobs. I mean, I was born at night, but not last night.
Democrats were also quick to point out that not a single congressional Republican voted for ARPA in the first place. So, Illinois Republicans are angry about not getting their way on how the ARPA money was spent when their party didn’t want the ARPA money to begin with.
The Democrats showed some political acumen by including other debt elimination in the bill, including paying off all the remaining debt in the College Illinois program and spending $300 million more on pension debt than required by law.
The package also included paying off close to a billion dollars in past-due debt for public employee and retiree group health insurance. The provision is a godsend for Springfield-area health providers, which have dealt forever with a state that has shown little to no interest in their fiscal well-being.
Yet every Republican in that region voted against the bill, including appointed Rep. Sandy Hamilton (R-Springfield). Hamilton is challenging Sen. Doris Turner (D-Springfield), and her “No” vote will likely be used against her this fall.
But, hey, the state’s wealthiest resident, Ken Griffin, is basically calling the shots for the GOP this election year because he has an abundance of what Republicans so desperately need right now: cash.
And you could bet your house (and the Senate) that Griffin would be very angry if the Republicans signed on to any sort of measure that could possibly involve future tax hikes on businesses.
Griffin was also no fan of the federal ARPA program, by the way.
posted by Rich Miller
Monday, Mar 28, 22 @ 7:43 am
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== The Republican crocodile tears ==
This seems to be their only party platform plank anymore.
It may have some short term benefits, but relying on a constant stream of short term benefits doesn’t work very well over the long term.
Has anyone in leadership within that party thought about what happens when the easily distracted people they were able to pull into voting by stoking their anger… are once again distracted and don’t vote.
While I certainly haven’t been a reliable voter for republicans, in the past I have voted for members of that party for some offices. There was a time where I could put their party identification behind their personal policies. That generally worked out fine. Now, that will never happen again likely for the rest of my life because their party identification is all they seem to have left, and that identification means I can’t trust in the long term what they are saying about any particular policy.
I’ve seen this same behavior in the Democratic party as well, but it seems to be much more localized and not nearly as entrenched.
Comment by TheInvisibleMan Monday, Mar 28, 22 @ 8:03 am
I’m not sure how we got to the point where legislators won’t vote to help their own districts. Rep. Sandy Hamilton (R-Springfield) and others should have voted for this but instead they are apparently wholly owned subsidiaries of a larger organization telling them how to vote I guess?
Comment by One Trick Pony Monday, Mar 28, 22 @ 8:07 am
“But that Hoosier decision came with a different and much more devastating cost, because Indiana’s COVID death rate is significantly higher than in Illinois rate”
Money over life is the GOP way, yes.
“I was born at night, but not last night.”
Lol, great line. And true, of course, about crocodile tears when pandemic UI benefits were being deliberately ended by Republicans in other states.
The upbeat feeling is shared with the business community. If we remain on this path, paying bills, rebuilding failing infrastructure and properly funding state budgets, especially education, that would be pro-business. The spelunkers want a race to the bottom red state approach, stripping union rights, workers comp, regulations, big budget cuts, etc. We are demonstrating clearly how unnecessary it is.
Comment by Grandson of Man Monday, Mar 28, 22 @ 8:26 am
“not sure how we got to the point where legislators won’t vote to help their own districts”
By putting party over the good of the State. By making a conscious decision to not give the opposing party a “win”. By becoming the party of No.
Comment by Huh? Monday, Mar 28, 22 @ 9:32 am
Good article.
Although it was not the main theme, the information on the health benefit fund was good to see. Generally our newspapers and other media options don’t cover this issue. A few weeks ago this column had some news on it. It really is a big problem that needed to be addressed years ago so adding to that fund was a solid step forward.
Sometimes the only avenue to improving the state is by compromising your goals. On the full funding of the Unemployment Trust, I agree with the R’s in that not funding it is going to have a negative effect not only on businesses, but also on employees. Unfortunately the votes were not around this time and supporting the funding of these items was necessary. Voting against the bill to hold out for what was just not going to happen was not particularly in anyone’s best interest in this session of the GA. Best to put these funding choices before the voters and be as productive as you can be in the current situation.
Good coverage in a short and direct way is something these issues needed. Good to see the Times step up.
Comment by Back to the Future Monday, Mar 28, 22 @ 10:07 am
I participated in the negotiations between Business and Labor during the 2008 recession and the resultant need to resolve the UI fund deficit. The legislators have almost always just straight accepted the negotiated result.
To turn this into a political hot potato benefits nobody and certainly not negotiations
Comment by Bothanspied Monday, Mar 28, 22 @ 10:49 am
1. Only 12.5 percent of IL workers are in unions. So why is only labor in the room for the “left” perspective in negotiations.
2. Business getting veto power in negotiations is why the Trust Fund fell apart during the pandemic — the UI tax system wasn’t properly set up to fund the Trust Fund before the pandemic hit. So when business this couldn’t have been foreseen they are both right and wrong - we couldn’t have foreseen COVID but we could have foreseen that the next emergency was going to blow a huge hole in the Trust Fund and we could have set up a fair employer tax system in advance to prevent that.
Comment by Business and labor Monday, Mar 28, 22 @ 2:50 pm
Seems pretty transparent that Republicans want to use the Unemployment Trust Fund as a cudgel to make it so Democrats can’t suddenly claim the “fiscal responsibility” mantle from them.
I don’t think it’s going to work.
Comment by Nick Monday, Mar 28, 22 @ 4:18 pm
There are millions of Illinoisans who have been adversely affected by the UI Trust Fund and state agency debacle. If there is any candidate for Governor who can clearly fix the blame where it belongs and articulate a solution, that candidate will win in November.
Comment by Punley Deiter Finn Tuesday, Mar 29, 22 @ 4:05 am