Illinois is running out of time and money

WP ^ | 4/25/2012 | George Will

[Signalman]

After trying to tax Illinois to governmental solvency and economic dynamism, Pat Quinn, a Democrat who has been governor since 2009, now says “our rendezvous with reality has arrived.” Actually, Illinois is still reality-averse, so Americans may soon learn the importance of the freedom to fail in a system of competitive federalism.

Illinois was more heavily taxed than the five contiguous states (Indiana, Kentucky, Missouri, Iowa, Wisconsin) even before January 2011, when Quinn got a lame-duck legislature (its successor has fewer Democrats) to raise corporate taxes 30 percent (from 7.3 percent to 9.5 percent), giving Illinois one of the highest state corporate taxes and the fourth-highest combination of national and local corporate taxation in the industrialized world. Since 2009, Quinn has spent more than $500 million in corporate welfare to bribe companies not to flee the tax environment he has created.

Quinn raised personal income taxes 67 percent (from 3 percent to 5 percent), adding about $1,040 to the tax burden of a family of four earning $60,000. Illinois’ unemployment rate increased faster than any other state’s in 2011. Its pension system is the nation’s most underfunded, and the state has floated bond issues to finance pension contributions — borrowing money that someday must be repaid, to replace what should have been pension money that it spent on immediate gratifications.

Quinn’s recent flirtation with realism — a plan to raise the retirement age to 67 and cap pension cost-of-living adjustments — is less significant than the continuing unrealistic expectation that some of Illinois’ pension investments will grow 8.5 percent annually. Although the state Constitution mandates balancing the budget, this is almost meaningless while the state sells bonds to pay for operating expenses (in just 10 years the state’s bonded debt has increased from $9.4 billion to $30 billion), underfunds pensions...

[Gay State Conservative]

I live about 70 miles west of Detroit and haven’t been there for about 5 years when I went to a ball game. I avoid all cities like the plague.

I live near Boston and get to NYC regularly...both cities,while far from being a paradise,are light years above what I saw in Detroit.My visit to Detroit filled me with enormous sadness and fear for this country's future,given that what I saw is the logical conclusion of long term dominance by Rats and Marxist unions.

[Piranha]

The point, BillyBoy, is that a socialist agenda like ours in Illinois may drag down our state, but it shouldn’t bring down the republic.

Within Federalism, a state’s chief role may be to act as a negative example to others.

Perhaps Illinois’s dire economic straits may even lead to the demise of the combine.