Latest Post | Last 10 Posts | Archives
Previous Post: Rosemary Mulligan
Next Post: Remembering Judy
Posted in:
* From the Tribune’s budget story…
As a candidate, Rauner spoke mostly in general terms of his desire for lower taxes and higher school spending, though he did not reconcile the two or explain how he intended to accomplish both. He added another wrinkle in mid-December, telling an audience in Springfield that he had no intention of making significant cuts in the Medicaid program providing health care to the poor.
But education and Medicaid together comprise the two biggest items in the state budget, accounting for well over half the spending in the already stretched general funds that pay for day-to-day expenses.
“That dog won’t hunt,” said Ralph Martire, executive director of the Center for Tax and Budget Accountability, a union-backed research center in Chicago. “He can’t maintain or enhance the spending he claims he will maintain or enhance with the tax policy he proposes. One of those two has to give.” […]
[Former Gov. Jim Edgar] said Rauner’s most pressing task is reconciling the state to the impact of Thursday’s income tax cut, which is expected to slice $2 billion from state revenues over the next six months. If left intact, the income tax cut could cost the state more than $4 billion in revenue over an entire budget year.
“Doomsday’s coming, we do not have a printing press,” Edgar said. “I was talking to some people to see if there’s any smoke and mirrors left and I don’t think there are. They’ve used them all.”
posted by Rich Miller
Monday, Jan 5, 15 @ 9:36 am
Sorry, comments are closed at this time.
Previous Post: Rosemary Mulligan
Next Post: Remembering Judy
WordPress Mobile Edition available at alexking.org.
powered by WordPress.
Maybe use some of that $20 million to buy some new smoke and mirrors?
Comment by PublicServant Monday, Jan 5, 15 @ 9:42 am
Rauner has already pulled out the “it’s worse than I thought” card. So you can throw away anything he said as a candidate. Besides, anybody that believed anything Rauner said on the budget as a candidate had to either be gullible or a complete moron.
Comment by Demoralized Monday, Jan 5, 15 @ 9:52 am
It seems as though Edgar might have been looking in a smoky mirror when he came up with that quote…He used up his share.
Comment by flea Monday, Jan 5, 15 @ 9:57 am
Watch what Quinn does with the medical marijuana licenses, his pal Jack Lavin is going to make million and millions just the the casino licenses back in the day. Rich time to do a thread on that, who is making the money as the expense of sick people.
Comment by Jeff Spicoli Monday, Jan 5, 15 @ 10:00 am
“If left intact, the income tax cut could cost the state more than $4 billion in TAX revenue over an entire budget year, SAVING ILLINOIS CITIZENS $4 BILLION TO SPEND WHAT THEY EARNED.”
There - fixed it.
The money doesn’t disappear. We get to keep ours. Lets start recognizing whose money this is, OK?
That said, this is a big problem for our government. We have obligations and commitments to meet. Rauner will need to create new ways to tap into new tax revenue without tapping into citizen wallets, because even seven years after the Great Recession, middle class citizen income hasn’t returned to pre-2007 levels, and we are tapped out.
What we have also discovered since 2007 is that governments can borrow billions upon billions with the idea of injecting those billions into a stagnant economy believing it will stimulate a return - and it doesn’t. Advocates of 20th Century Keynesian economics are still excited over how our governments can spin those wheels and watch the mud fly - but not see that their policies only dig our society deeper into debt without moving us forward. A saturation point has been reached and something else has to be done because what used to work is no longer working.
I have no idea what Rauner is going to do to fix this, but doing what has been done over the past decade doesn’t work anymore, if it ever did.
It is reasonable and fine to admit that his stated approach leaves much to be desired, but we also must start demanding that those same cynics admit that their way of getting us out of this hole has been a bust as well, because our economy still sucks eggs. This is Illinois, not Portugal. What we have been going through is thoroughly insufficient for this great state.
We need to hope for something, even if Mr. Shake Up Springfield and Mr. Speaker is all we got.
Comment by VanillaMan Monday, Jan 5, 15 @ 10:14 am
Hey, you could always sell off the JRTC and lease it back….
Comment by Skeptic Monday, Jan 5, 15 @ 10:20 am
==Rauner will need to create new ways to tap into new tax revenue without tapping into citizen wallets==
Unless he’s got magical powers, there is no such thing as taxation that doesn’t impact the wallet of citizens in one way or another.
Comment by Demoralized Monday, Jan 5, 15 @ 10:31 am
===Rauner will need to create new ways to tap into new tax revenue without tapping into citizen wallets===
Genius. Let’s find someone other than citizens to tax. Sounds great. How would that work exactly?
It’s a new year VanillaMan, can’t you please try to up your game just a little bit?
Comment by 47th Ward Monday, Jan 5, 15 @ 10:35 am
=“That dog won’t hunt,” said Ralph Martire, executive director of the Center for Tax and Budget Accountability, a union-backed research center in Chicago. “He can’t maintain or enhance the spending he claims he will maintain or enhance with the tax policy he proposes. One of those two has to give.”=
Gee, I wonder which one Martire will be promoting?LOL Last week I read a quote from him, and the reporter actually did a little research so that his readers would temper Martire’s comments based upon from where his money comes. 40% comes from organizeed labor in Illinois alone. Pretty simple to figure out the rest comes from the pro-spending lobby as well. I just wish “journalisists” would strip the facade that this guy and his organization have interest in anything other than getting ever greater tax dollars into his benefactors’ pockets…
Comment by Arizona Bob Monday, Jan 5, 15 @ 10:35 am
Keep the lower tax rate, or even lower it. Apply it to federal taxable income. Higher revenue, more progressive. Done.
Comment by Excessively Rabid Monday, Jan 5, 15 @ 10:45 am
@Arizona Bob: Underlying both Mr. Martire’s and Governor Edgar’s quotes is the same basic math. There will have to be extensive reductions in expenditures, increased income tax revenue, a combination of cuts and taxes, or record breaking economic growth real fast.
Governor Rauner can’t protect Medicare expenditures and increase k-12 education funding with the anticipated revenue. It’s obvious, so this is all a tactic I suspect to make it appear to the public that cuts or tax increases can be blamed on the legislature not the new Republican administration. All will be revealed shortly.
Comment by Rod Monday, Jan 5, 15 @ 11:02 am
http://chicago.suntimes.com/other-views/7/71/255384/new-governor-deserves-little-breathing-room
Comment by Namaste Monday, Jan 5, 15 @ 11:05 am
VMan, aren’t you the guy who wants a “temporary” 25-year tax on retirement income to prop up your state pension? To expire when you retire? Such conservative economic principles, lol.
Oil is down 50 percent since June. The wise guys say it might drop to $50 a barrel and stay there for a while. I’m guessing a bump in the gasoline tax for GRF is looking tasty to some.
Comment by Wordslinger Monday, Jan 5, 15 @ 11:20 am
Once again: the reason to pay attention to Martire’s reports is that his numbers actually add up. That cannot be said for most other political “budget analyses” put out in Illinois.
We may disagree with his recommendations all we like, but when Martire says that Rauner cannot pay for increased spending in x, y, and z as promised, while simultaneously cutting tax receipts, we had better pay attention. The arithmetic is unyielding. Do the numbers yourselves if you want.
Comment by walker Monday, Jan 5, 15 @ 11:31 am
Also from the story:
===Edgar, the former Republican governor and one of Rauner’s transition advisers, sees that lack of specificity as a plus. “I’m amazed he was able to promise as little and say as little and get elected,” Edgar said.===
The longer Rauner goes without revealing his plan, the more likely it is he doesn’t have a plan. Which means the more likely nothing happens or something really bad get passed. Gonna be an interesting 6 to 10 weeks.
Comment by From the 'Dale to HP Monday, Jan 5, 15 @ 11:41 am
Edgar misremembered…when talking about smoke and mirrors budgeting the correct phrasing wasn’t “They used them all up” but rather “We’ve used them all up.” My favorite, other than his non-pension funded budgets, was when he funded Public Aid one year for 10 months and called his budget balanced.
Comment by Louis Howe Monday, Jan 5, 15 @ 11:42 am
@Rod:
I don’t disagree regarding Rauner’s numbers not being consistent with his statements. My point is that when Martire speaks, he only presents half the argumment, the “adding” side. Perhaps I missed it, but I cannot recal him nor his group proposing ANY cuts of low value spending or finidng more cost efficient ways of delivering goods and serivices to the people of Illinois.
One would think that the “accountability” part of his organizations name would include some reckoning on that, but it never seems to do so.
I also agree that at least some temporary revenue increases will necessary to dig our way out of this hole, but without cutting first it will just harm the taxpayers and delay judgement day rather than enacting the necessary structural reforms to control the problems.
Comment by Arizona Bob Monday, Jan 5, 15 @ 12:04 pm
@Wordslinger
=The wise guys say it might drop to $50 a barrel and stay there for a while. I’m guessing a bump in the gasoline tax for GRF is looking tasty to some.=
the Feds are already looking at it under McConnell in the Senate and Boehner in the House….”Meet the new Boss…..Same as the old Boss… I GUESS WE’RE FOOLED AGAIN!!!!” (with apologies to “the Who”)
Comment by Arizona Bob Monday, Jan 5, 15 @ 12:08 pm
The whole Tribune budget story was brilliant.
I hope their editorial board reads it.
Comment by Yellow Dog Democrat Monday, Jan 5, 15 @ 12:32 pm
It’s instructive that AZ Bob does not contradict Martire’s numbers. It’s easier to attack his organization and to attack what Martire doesn’t do than it is to refute his budget analysis.
=== I also agree that at least some temporary revenue increases will necessary to dig our way out of this hole …===
Did hell just freeze over? I think AZ Bob just came out for a temporary tax hike. If someone as conservative as him takes that position, it may mean the GOP will be proposing tax hikes soon.
Comment by anon Monday, Jan 5, 15 @ 1:01 pm
Is this the best Illinois can do? Rauner or Quinn? I guess so and we’ve got Rauner who speaks out of both sides of his mouth. Where is his supposed business acumen? He must know that he speaks with a forked tongue.
Anyway, I would suggest. a two year extension of the tax increase, stop the expansion of Medicaid, freeze all other parts of the budget for each and every agency /department, and cut $1 billion from last years appropriations to pensions.
Then over the next tow years pay down all the outstanding bills and get the financial house at least in some sort of order.
Rauner is Governor. He can veto anything that varies from the above and I believe he could sustain his vetoes.
Am I being simplistic? Perhaps, but I have not seen any better ideas yet, at least in my opinion.
Comment by Federalist Monday, Jan 5, 15 @ 1:15 pm
Wordslinger - the drop in gasoline prices is a net loser for purposes of state tax revenue. State sales tax is imposed on price of gasoline so much less sales tax revenue from $1.99 gas than $4.50 gas. Even if consumption goes up it won’t offset the large price decline through additional motor fuel taxes. Also, while sales taxes go mostly to GRF, motor fuel taxes do not as I recall.
Comment by Anonymous Monday, Jan 5, 15 @ 1:25 pm
==cut $1 billion from last years appropriations to pensions.==
So basically go back to not making the full pension payment. Good plan. That’s worked out well so far.
Comment by Demoralized Monday, Jan 5, 15 @ 1:37 pm
Anon, depends if you tax by sales or gallons.
My only point is that gasoline is an area where there’s been an unexpected and dramatic drop in cost to the consumer, so I could envision it might be tempting to those seeking new revenues.
Comment by Wordslinger Monday, Jan 5, 15 @ 2:01 pm
Rauner promised to boost infrastructure spending. A hike in the gasoline excise tax is a way to pay for it. Since it’s a regressive tax, that should appeal to him.
Comment by anon Monday, Jan 5, 15 @ 2:06 pm
You all are missing that Messiah Bruce will fix the budget by the sheer magical force of his personality. On day one, Bruce will say, “abracadabra alakazam financial mess go away!” Poof! It will then disappears and the weather will be 75 degrees, the sun will be shining, and we’ll all be his serfs.
Comment by Precinct Captain Monday, Jan 5, 15 @ 2:23 pm
Demoralized,
Believe me, I said this with great trepidation.
However, cutting it from $7.5 billion to $6.5 billion and using the money to pay the backlog of debts is something I believe must be done quickly. It may be the most crucial aspect in the a public perception as to the credit rating agencies (which I don’t have a lot of faith in but that is another story).
I would also not advocate my proposal unless the other measures I included were enacted.
Comment by Federalist Monday, Jan 5, 15 @ 2:25 pm
===Oil is down 50 percent since June. The wise guys say it might drop to $50 a barrel and stay there for a while. I’m guessing a bump in the gasoline tax for GRF is looking tasty to some.====
And palatable to even more. Even the kind of person who votes.
Comment by A guy Monday, Jan 5, 15 @ 2:44 pm
Little doubt that both states and the Feds want a gasoline tax at this point. But how will that help the general budget? It won’t if it is used for roads and infrastructure as it is supposed to be.
Of course, the sneaky little devils might be tempted to divert that money for purposes other than roads and just dump it in the general budget or find other ways to rationalize its expenditure. The public would not be happy but who cares and it might take awhile before anybody finds out anyway.
Comment by Federalist Monday, Jan 5, 15 @ 2:57 pm
@anon
=It’s instructive that AZ Bob does not contradict Martire’s numbers. It’s easier to attack his organization and to attack what Martire doesn’t do than it is to refute his budget analysis.=
I’ve found that Martire’s budgetary evaluation work isn’t technically incorrect, but often negligently incomplete. For example, he excludes consideration of any fiscal actions that may not benefit his contributors, no matter how much in the best interest of the people of Illinois. Only by the old bromide, ” a half truth is worse than a lie” could the man be called a liar.
=Did hell just freeze over?=
Been outside around Chicago recently?LOL
Seriously, I think most conservatives understand that there is a pennance to be paid in Illinois for the bad electoral decisions of the people that led to the current financial crises. they’re willing to bite the bullet…temporarily…provided that public pensions contributions have been cut to the minimum allowable by law, serious operational reforms in pits like IDOT, ISBE, K-12 public education and public higher ed have been made (including those crooked patronage havens like COD)and that thyere’s good faith effort on the part of the GA and state and local governments to reduce the excesses taxpayers see all too often.
To date, I’ve seen nothing that indicate any measure for real reform of the root causes of the problems has even begun, especially that unconstitutional penion “red herring” that’s about to start to stink.
Comment by Arizona Bob Monday, Jan 5, 15 @ 3:53 pm
@Arizona Bob
Interesting that you did not mention Medicaid which over the past four decades has been the real budget buster- far more than anything you listed.
I find this neglect to be quite common among so-called conservatives and liberals. It is obvious and a huge financial issue but rarely does anyone have the guts to mention it.
Comment by Federalist Monday, Jan 5, 15 @ 4:07 pm