Illinois: America’s new fiscal basket case
How fitting that the state that produced the profligate corruptocrat-in-chief is now collapsing under the weight of its own fiscal irresponsibility. The same union-coddling, welfare state-expanding, pay-for-play politics that wrought the current misery in Illinois are wreaking havoc for us all. And to think: If President Obama, Mrs. Obama, Valerie Jarrett, and Chicago Mayor Richard Daley had had their way, they would have shoveled billions more in taxpayer funds down the drain for their Olympics folly. As I’ve noted here before, you can take Obama out of Chicago, but you can’t take the Chicago out of Obama.
What a costly lesson for America to learn, eh?
Via the NYTimes:
Even by the standards of this deficit-ridden state, Illinois’s comptroller, Daniel W. Hynes, faces an ugly balance sheet. Precisely how ugly becomes clear when he beckons you into his office to examine his daily briefing memo.
He picks the papers off his desk and points to a figure in red: $5.01 billion.
“This is what the state owes right now to schools, rehabilitation centers, child care, the state university — and it’s getting worse every single day,” he says in his downtown office.
Mr. Hynes shakes his head. “This is not some esoteric budget issue; we are not paying bills for absolutely essential services,” he says. “That is obscene.”
For the last few years, California stood more or less unchallenged as a symbol of the fiscal collapse of states during the recession. Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget.
Then there is the spectacularly mismanaged pension system, which is at least 50 percent underfunded and, analysts warn, could push Illinois into insolvency if the economy fails to pick up.
States cannot go bankrupt, technically, but signs of fiscal crackup are easy to see. Legislators left the capital this month without deciding how to pay 26 percent of the state budget. The governor proposes to borrow $3.5 billion to cover a year’s worth of pension payments, a step that would cost about $1 billion in interest. And every major rating agency has downgraded the state; Illinois now pays millions of dollars more to insure its debt than any other state in the nation.
“Their pension is the most underfunded in the nation,” said Karen S. Krop, a senior director at Fitch Ratings. “They have not made significant cuts or raised revenues. There’s no state out there like this. They can’t grow their way out of this.”
As the recession has swept over states and cities, it has laid bare economic weakness and shoddy fiscal practices. Only an infusion of federal stimulus money allowed many states to avert deep layoffs last year.
The government stimulus has caused more problems than it has solved. Matt Mitchell of the Mercatus:
The real question is: Intentions aside, does government spending actually stimulate the economy? Over the long run (when Lord Keynes said we were all dead) the answer is almost certainly “no.”
Using international data, a number of peer-reviewed studies have examined the relationship between government size, somehow measured, and economic growth. Here is a sample: Barro (1991 and 1989); Folster and Henrekson (2001); Romero-Ávila and Strauch (2008); Afonso and Furceri (2008); Chobanov and Mladenova (2009); Roy (2009); and Bergh and Karlsson (2010). Each of these studies finds a strong, statistically significant, negative relationship between the size of government and economic growth.
What about the short run? Here again the evidence seems weak at best. Consider new research by Harvard’s Robert Barro and Charles Redlick. They find that for every dollar the government spends on the military (read: takes out of the private economy), the economy gains just 40 to 70 cents. Spending a dollar to obtain 40 to 70 cents does not a good deal make. Or consider another study by Harvard’s Laruen Cohen, Joshua Coval and Christopher Malloy. They rely on the fact that the federal government tends to spend more money in districts whose congressional members are chairs of powerful committees than in districts whose members are just rank-and-file. They find that firms actually cut capital expenditures by 15 percent following the ascendency of a congressman to the chairmanship. Moreover, firms seem to scale back employment and experience declines in sales.
It seems to me that by just about any measure, we are currently conducting a large-scale experiment in massive government spending. Moreover, I believe the results of previous experiments predict that this one will lead to slower growth and less economic opportunity.
Illinois needs a Chris Christie.
Instead, we have Santa Obama ready to fork over more boodle.
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Apparently California has competition for the Stupidest State Award.
Don’t leave New York out of that competition.
and Oregon, Minnesota, Michigan, Massachusetts, New York so there’s a few that can compete for the award. Funny, I can’t put my finger on it right now, but what is it they all seem to have in common…?
You could change this heading to WA ST. They too are facing a massive billion dollar deficeit. No one knows for sure how much of a deficeit it is because there are all sorts of numbers flying around (the most common being around $5 billion). So what did the legislature do? Raise taxes. The new taxes include more taxes on cigarettes and alcohol, new taxes on bottled water, candy, soft drinks, and blue collar beer (they made an exception for the boutique beers).
Couple that with a governor who signed away the states gambling compact with the indian tribes (yep WA ST no longer gets a cut of the tribes gambling revenue)and increased public sector employees pay and benefits (as well as the number of union workers by hiring even more employees).
The legislature also threw out the initiative that required a 2/3 majority to raise taxes (they can do that after the intiative has been on the books for 2 years)and now we have Bill Gates Sr. helping to get a state income tax by telling people that it will only tax the rich while lowering everyones property taxes (of course that is until the legislature raises the property taxes back up and after two years lowers the tax bracket for the income tax).
Amazingly Chicago ($12 B) by itself is rivaling the whole state of California ($19 B) …
It is so obvious there is no one in any elected office and any level that can do the most basic levels of math …
Sometimes I think it would be cheaper just to move all the liberals to half of the country and the conservatives to the other half of the country and then split into two countries.
Still waiting to get my income tax refund from the state, guess now I know why it’s so late. Kiss that one goodbye.
I wish Christie was running for gov. of Illinois!
Snap.
Thinking Wisconsin, typed Minnesota.
Preview is your friend.
So, rather than do what must be done, that is, stop shoveling tax payers money to union labor at a rate of 1.5x what they are really worth, no, the corrupt ruling class chooses to stiff everyone they actually need…
Sounds like the people of Illinois have some problems they need to fix … I don’t see where it’s my problem.
Elections don’t have consequences…electing liberals has consequences. Let em suffer
Government is a necessary evil that needs to be minimized. How big our government needs to be depends on our own personal virtue as a people. As such, government spending is counter-productive by definition, especially once it exceeds the bare minimum needed to offset our own personal virtue deficiencies.
To further assume that ALL government spending is stimulative is idiocy. Directing “stimulus” spending exclusively bloated state budgets is criminal economic malpractice. All government spending is not alike.
Funding of job creation in those private sectors that already account for the vast majority of overall employment and of 75% of jobs created throughout American history would be money better spent. It would be temporary and pay immediate dividends.
Yeah, that’ going to happen in this one-party system.
*Pasadena Phil will be one happy camper with this story!
*P-BO and the Dems will try their best to prop up these states, at least the union thug portion of them, but it has come to a head; The well is long past dry, and these various states would do well to follow what Chris Christie is doing in New Jersey; I refuse to have any more of my hard earned money confiscated to prop up fiscal stupidity around this country; The tide is about to turn!
*It just may come to that, but better to staff Congress with constitutional conservatives/libertarians that have the guts to dismantle all existing unconstitutional entitlements, mandates, and federal government intrusion!
It’s a shame that the poor suffer the most with raised taxes on consumer goods. Yet, they are the ones who rush to vote back into office, the same ones that tax them into more poverty.
Powerline has been running an excellent series called “What Price Christie” equating the rise of Christie to that of Churchill. Can we afford to waste that man on NJ?
We are currently headed for a disastrous November where the Assistant Democratic Party is expecting to return to power without lifting a finger. This bodes ill for conservatives and America in general in 2012.
Every time I see Sarah Palin, Tea Party and Republican party in the same sentence I puke. We are losing control of the Tea Party movement to this woman and she is redirecting everything we are trying to do right back to the RINO establishment. She just single-handedly wrecked this November for those of us in CA who are working very hard to retake control of our state. Get used to the return of Barbara Boxer and Governor Moonbeam and remember that this was made possible by the Republican Party and
Elly-May ClampettSarah Palin.The defeat of John McCain on August 24 is the most important objective on our plate right now but he is leading in the polls by far. What is wrong with you Arizonans? Are you actually going to hold your noses to vote for that scum bag just because Hayworth isn’t perfect? WTF?
No wonder AZ is being surrendered to Mexico. You don’t have a Duncan Hunter building a border fence like we do. You don’t have Californians like me making it impossible for open-borders zealots to be elected.
The GOP is using the same tactics it used in CA ten years ago to neutralize conservatives and yet listening to Texans and Arizonans talk, California is to blame for their problems. Wake up already! We’ve been there are we are warning you! We are not the enemy! Your elected politicians are! Work with us, not against us!
So why can’t we just pay off the deficit from “Obama’s stash?”
Michelle, you have mis-spelled Satan.
Pasadena Phil said:
I was impressed with Duncan Hunter until he endorsed Huckabee back in 08. Duncan Hunter is just like Palin, another disappointment.
*I’m right there with you Phil; Jim DeMint is knocking heads with the GOP, and that’s why I’m a big fan of his, and am supporting with coin as best I can, the likes of Rand Paul, Sharron Angle, Mike Lee, Ken Buck, et al.
*In regards to J.D. Hayworth, I know he is not a Tea Party conservative, but John McCain is a dog log on my shoe and J.D. is the “Mean Green” I am willing to use to wipe that stink off with; The GOP is D.O.A. if McCain wins the primary; Sarah has backed a horse long past due for the glue factory!
I’d submit that The United States is in need of a Chris Christie..Michelle can be his VP….
Quinn will do everything but the right thing.
Good luck with that. Anyone who remotely resembled Christie left Il long ago. Il has a lot of pain to experience before things are changed. Corruption and the Dalys need to go. Bho voted against a corruption clean up when he was in the state government. Chicago drove itself into the ground for political gain. Taxes went to line pockets and now the bill is due. That prison which was supposed to house GITMO detainees should be filled with the Chicago corruptocrats.
McCain definitely needs to go to the big glue factory in the country. Wow, what a loser. How could he show his face after blowing the election to Odumbo?
He’s old. Why not retire?
I’d send Lautenberg to the glue factory as well.
There isn’t a single thing on the “essential” list that couldn’t be put in the hands of the private sector at lower cost. In addition, there is no reason to continue propping up departments and agencies just because they are there. The biggest way to get things under control isn’t to increase taxes or even cut spending, it is to eliminate bloated bureaucracies.
What do you expect when dead people get to vote and the moochers get to vote more than once, and they bus in people from out of state to vote. They deserve what they voted for as do all the Obamabots. It’s the rest of us who have to live with it too–which is the sad thing.
The liberal Democrat strongholds of Chicago and East St. Louis have been getting drunk at the government trough for decades with their social programs, corruption, and giveaways. The rest of the state in the more conservative rural/small town areas are always out-voted by these large population centers. Guess what. The poor slobs in the rest of the state are going to foot the bill for the liberal’s folly and won’t be able to stop it. What a pity!
Since tax increases actually cause revenue to drop, that would be the wrong thing to do. They should either go to a state flat tax or pass a state version of the FairTax. That would bring in much more revenue.
Unfortunately, that would just mean more money for the liberal socialists to waste.
Thank you Illinois for having a worse budget mess than the People’s Socialist Quagmire of California. I knew if we hung in there long enough, we’d get bumped out of first place!
Me? Chicago bred, born, and raised.
Do I dare say I am glad I live in Cali? Uhm, both states are mired in liberal fiscal mishandling, but at least I don’t have to deal with the crappy winters of my hometown.
let ‘em burn.
and sell their assets on ebay.
Duncan Hunter is no Sarah Palin and the endorsement from a candidate who didn’t even break 1% in the polls is irrelevant. By the time, he endorsed Huckleberry, there were only two choices. He picked the lesser of two gawdawful choices.
A lesson for AA: here in CA before the border wall was built, San Deigans would drive to the border en masse every night and shine their headlights at the border to bring attention to government incompetence. They didn’t blame Arizona, Texas, or any one else. They just did it. Stop electing Kyls, McCains, and Napolitans and stop blaming everyone else for your own stupidity.
Drive en masse to that sign that your governor just highlighted whereby the US government surrenders part of your state to Mexico. Make a big stink and keep doing it. I guarantee that there will be more of us Californians there than whiny Arizonans. Suck it up and focus. And for God’s sake, John McCain?!?!?! What is WRONG with you people?!?!?!?!?!
On July 5th, 2010 at 1:10 pm, orlandocajun said:
Elections don’t have consequences…electing liberals has consequences. Let em suffer
………………………………….
I’ve live in Illinois since shortly before my 3rd birthday in 1973 and I was raised cradle conservative.
I currently work as a GOP election judge in Triple J’s district.
Because of my husband’s job we can’t move.
I’m tired of ‘suffering’.
Got any other ideas? If we did that in Flyover Country the sheriff would think a bunch of us were out “shining deer.”
Slightly OT….
3 die 13 hurt all in one night in the South Side of Chicago.
All by people using guns.
Anyway, it is proven again that Dem run states have money problems.
Simple chalkboard math.
Duh
Arnold Schartzenegger?!?!?! What is WRONG with you people?!?!?!?!?!
Barbara Boxer?!?!?! What is WRONG with you people?!?!?!?!?!
Diane Feinstein?!?!?! What is WRONG with you people?!?!?!?!?!
Lindsey Graham?!?!?! What is WRONG with you people?!?!?!?!?!
Al Franken?!?!?! What is WRONG with you people?!?!?!?!?!
Susan Collins?!?!?! What is WRONG with you people?!?!?!?!?!
Nancy Pelosi?!?!?! What is WRONG with you people?!?!?!?!?!
Welcome to America.
What? I thought the Mayor’s visionary gun legislation made this impossible. Are you telling me there were people who ignored the law, obtained weapons, and used them inside the city limits?
They could be ticketed for a noise ordanance violation!!!
I’m shocked! It is a good thing criminals never use guns on helpless, unarmed people, so the law abiding citizens are safe.
http://biggovernment.com/author/ccrenshaw/
In IL, the corruption is so imbedded into our culture that the leaders protect their positions by keeping good and decent folks from even getting on the ballot.
How can you vote in men and women who are ready and able to demonstrate fiscal and social conservative leadership IF THEY CAN’T GET ON THE BALLOT?
It is difficult to comprehend the depth of sh*t the liberal dems have built with their union partners.
I am a 4th generation Illinoisan and grateful for Michelle shining a bright light on our state.
Joshsmompam
I met Cedra Crenshaw at the Tea Party picnic in Lockport on Saturday. If I lived in Will County I’d vote for her.
Alas I live in Chicago Heights-home of republican politicians who switch to ‘D”s because getting elected is always more important than sticking to one’s principles.
//
Here in Minnesota, we will be losing Tim Pawlenty soon, and no doubt will get a democrat Governor. That is how stupid the voters are in this state (Al Franken, Jesse Ventura). The only thing that has kept us fairly solvent has been our Republican Governor. The legislature is mostly dems. Soon you will see Minnesota join the others in the “broke” category. We are close to that now, and a dem Gov will seal the deal.
There are more out there. Mass and NY, to name two…
We’ll be asked, as a nation, to bail them out forthwith. But there isn’t any month left to bail anybody out, so it’s pretty much crank up the printing presses, boys…
How many lies did Obama and his minions tell in the failed Chicago Olympic bid?
Is it any wonder when Obama speaks the world laughs.
If there as many of you as there were San Diegans at the CA border, it’ll be the largest herd of “shining deer” they ever saw.
Elly May ClampettSarah Palin torpedoed November for us conservatives in CA by endorsing vapid “girl power” Carly Fiorina. Tea Party conservative Chuck DeVore was the only Republican worth voting for in November. That wasn’t CA, that was the GOP and new establishment maverickElly May ClampettSarah Palin.Pelosi doesn’t represent CA, she only represents SF and couldn’t survive a state-wide election.
Feinstein is nowhere near a liberal threat that McCain and Kyl are except on 2nd amendment.
The only reason Arnold is governor is because the state GOP and RNC abandoned solid gold conservative Tom McClintock over “electability”.
See the problem here? What are we supposed to do? Here in Pasadena, we are about to elect arguably the best Tea Party candidate in America.
It’s not impossible but this knee-jerk CA trashing by fellow conservatives is ignorant and obnoxious, particularly from the hee-hawing Texans who believe that everyone outside of Texas is an communist while they keep electing Connecticut bike ranchers just because they wear cowboy hats in public.
It’s not necessarily that the voters are stupid but that your state GOP makes it impossible for the voters to get the people they want…. like in CA. Think conservative, not Republican. If AZ fails to oust McCain, we will again be fighting the same GOP we booted out in 2006 and 2008 over the same issues we are kicking out the Dems. So how stupid are Republicans?
Vote out all incumbents!
The GOP actually has a conservative running for governor, Bill Brady. Pro-Life, Pro-Gun, Pro-family. He actually has business experience as well. Pat “i got this job because Blago was a crook” Quinn is a populist who has done some good, but is clearly overmatched for the governorship. It does not help his candidency when there are tapes of Harold Washington, the late Chicago mayor, calling him incompetant. I do not know if Brady has the guts that Christie does, but it would be a start.
Sorry Phil, Palin has my support. She’s the best marksman in the GOP.
P.S. All the GOP has left in AZ for the Senate is McCain. Yes, it sucks, but Hayworth shot himself in the foot. He’s toast.
McCain is with us 50% of the time. Every Democrat is with us 0% of the time. If we cannot knock these people out in the primaries we have two choices; keep the Democrat out or third party.
What you really need are some of the light bars we have on our pickups. They’ll be night blind for days.
Arizona let herself get in a jam–nothing of this magnitude but certainly not as fiscally sound as she should have been. Illinois may well need a Chris Christie but first they would need more citizens with a brain-a diminishing breed nationwide it seems. The attitude that we can spend beyond our means without the bills coming due is not limited to governments.
If Arizona doesn’t oust McCain I just might move to Idaho or Wyoming-I already have the cowboy hat. I do not know how we can reach more people-poison the water? Just poison John McCain’s water? No, it probably violates some EPA rule or such.
And for those good people of Illinois who are just sick at heart at what the Chicago/Cook County thugs have done? Move to a red state and we’ll ship your old home our weenies, Liberals and assorted parasites. After that we have to work on saving California–it is just too damn pretty a state to let the wing nuts have it.
Being conservative one summer every six years give him a 10% at best. Being a more cost effective Progressive is not a virtue. Yes he is strong on defense-at least in front of the cameras. John McCain is Joe Liberman’s
semi-alter ego.
If you want to vote for a Democrat over McCain or not vote and let a Democrat in during a war, please do one thing for me. I’ll pay for the trip.
Go to D.C., stand in front of The Wall and explain to them how you voted for a Democrat in the middle of a war with troops in the field in harms way.
I will roast in Hell before I let Democrats do to what they did in Korea, Vietnam, Cambodia, Nicaragua, and Iraq again.
Lots of Democrats voted for Scott Brown in MA and it worked wonders for them and the rest of America. If it comes to that, would it be so bad for AZ to return the favor to take down their half of the globalist socialist twins?
I have a better idea. Make sure he loses the nomination on August 24. How bad could Hayworth be? Why is he even down in the polls? You guys deserve your problems if you can’t take McCain out this year. The borders are wide open and just about every key politician making it happen is from Arizona.
“McCain is with us 50% of the time”.
Why is that even offered as an argument? It’s like giving worms the right to vote because their DNA is 99% the same as human DNA. That other 1% makes a big difference in DNA and it makes a big difference in politics.
McCain is always with us in lost causes (like today’s GOP grandstanding as a single unit when they lack the votes to win) but when there he is landmark liberal legislation on the table, he is the one who always delivers victory to the Dems.
Here’s your outsourcing:
Maywood, California, lays off all employees.
http://finance.yahoo.com/news/Maywood-California-lays-off-cnnm-2024697265.html?x=0
It can be done! This should be an example to cities all over the country.
See, PasadenaPhil, Texans can say something nice about California.
The “McCain is with us 50% of the time” argument is fatuous!
The 50% he is with us on is far less critical than the the 50% he is against us.
Once amnesty and “cap and tax” are passed into law, America is pretty well done for and McCain supports national suicide on both issues. Nothing is is “with us” on is nearly as important!
McCain is leading the GOP in the charge toward national suicide!
No, I’ll not vote for a Democrat.
I have most certainly been to the Wall
I was on the original committee to fund the Wall
I know more than just a few names on the Wall
I know several former POWs. None of them make a career out of being a POW; none of the play the PTSD games either.
Sylvester Stallone and the Rambo character are wusses and did us no honor-either did the movies showing POWs as sickos or veterans as killers and wimps.
All that leaves me in a great quandary: how are we ever going to reclaim this country when our choices are Progressive Lite/Progressive ++? There are times I feel I am living in a Faustian nightmare.
But one foot in front of the other-it gets done. I am leaving for the summer-if I find some internet sites I’ll check in. Gone fishing as it were.
God Bless America except for the Blue States
Liberals will NOT move away from their disasters unless given government sponsored rides to Houston TX (see; Katrina). I hope all the Conservatives in IL, especially my sister, her husband and children, sell their horse ranch and move to a fiscally sound state. Illinois is terminally Ill with with checkbook bouncing plague. Chicago has destroyed the rural areas. Time to leave Sodom and Gomorrah at a financial loss. Do NOT look back.
I want to move-I’ve told my husband that I do NOT intend to spend my middle/old age in Illinois-but his job won’t transfer him to Texas and we’re barely making making ends meet.
We want to move…but we’re stuck.
When you have ignorant citizens, educated by a “pc” school system, coupled with politicians who have no idea how to run economics (educated by the same system), except how to maintain and increase personal power, you have chaos, that continues when the “citizens” vote back in those same politicians, who promise the moon and whatever else people want to hear.
Every one likes to point out the stupidity of the Illini folks but look what the rest of the U.S. did. They elected the biggest crooks from Illinois along with his henchmen from all the other 49. It’s time we all got our act together
Cubbiegal—-I feel for you. Left Illinois in 02 and moved to N. Carolina (early retirement from the State). We love it here (north of Charlotte).
Raleigh area is still a good job area and I believe Austin Tx is also. Good Luck.
We need a national impeachment iniative. From Obama on down. Enough is enough. These dullwitted Marxist delinquents are deliberately destroying the nation and we cannot wait until 2012 to stop them. The worst state and federal elected officials have to be removed immediately and the profligate spending has to be reversed, and the tax cuts accelerated.
Illinois, and all states, need to solve their own financial problems. Other, more fiscally responsible, states should not be dragged down with the inept. This is culling in the herd and a heads-up that SOCIALISM still does not work.
Oh, and scale the federal government back to the ennumerated powers. Return power to the states.