House Speaker Madigan has struck a populist pose on corporate tax incentives, denouncing the very practice he previously embraced.
Illinois House Speaker Michael Madigan plays his cards close to the vest, making few statements and answering even fewer questions.
So when he speaks, it means something, even though Madigan often makes a point of being less than clear. So it was interesting, if not instructive, on Wednesday, just one day after Illinois lost 1,600 Naperville jobs to Boca Raton, Fla., that Speaker Madigan issued a ringing denunciation of providing tax incentives to retain businesses that are considering a move out of state.
"We must resist the temptation to cave to corporate officials' demands every time they impose a deadline for payment in exchange for remaining in Illinois, and end the case-by-case system of introducing and debating legislation whenever a corporation is looking for free money from Illinois taxpayers," he said.
Madigan's statement was a combination of demagogic flim-flam. ...
"So I find it very difficult to support tax giveaways for corporate CEOs and millionaire shareholders whose companies pay little in state taxes."
... and a reasonable call for a serious discussion of a complicated issue.
"We should instead take a more long-term approach to helping all job-creating businesses in Illinois thrive and succeed, including thoroughly reviewing how we currently provide incentives to big corporations."
So now he tells us. Speaker Madigan's words come late in the game. He was complicit in recent agreements that offered incentives to Sears Holding and CME Group. It is theoretically possible that Madigan has sincere reservations about this approach. But, given his history as an amoral political tactician, it is plausible that Madigan's statement is meant to provide political cover after losing Office Depot and setting the stage for the possible loss of Decatur-based ADM.
Here's the background.
Office Depot of Florida is merging with OfficeMax of Illinois. Undecided about where to locate the merged headquarters of the two companies, Office Depot entertained offers from Florida and Illinois. Florida offered incentives. Illinois did not because Madigan refused to allow a Senate-passed incentives bill to be voted on in the House. Tired of waiting for a decision, Office Depot accepted Florida's offer and 1,600 Naperville jobs are leaving. In a state that needs jobs, people and the tax revenues they generate, this is not progress.
As for ADM, the agricultural giant is moving its headquarters from Decatur, and it's believed to be leaning toward Chicago as its first choice. But other states are courting ADM with lucrative offers. ADM has pressed for legislation providing tax credits worth $1.2 million a year for 20 years to choose Chicago, but it has indicated it needs a decision by the end of the year.
Madigan has dismissed that timetable, choosing instead to engage in a game of chicken with ADM. Maybe ADM will choose Chicago anyway, but maybe, like Office Depot, it will go elsewhere
Madigan is certainly correct that the business of offering tax incentives to major corporations is distasteful. He calls it another form of "pay to play."
But Madigan's Democratic colleague, Senate President John Cullerton, laments that "you have to play."
And whose fault is that?
Nothing happens in Illinois without Madigan's assent, including the creation of a hostile business climate that discourages job creators from opening, relocating or expanding here. Because of that, the people of Illinois suffer from a lack of opportunity while the state of Illinois faces unprecedented fiscal chaos.
There is a reason the state's unemployment rate is in excess of 9 percent, well above the national average, and it's that Illinois' elected officials collectively have failed in their responsibility to make this state a place where job creators want to be.
Madigan has called for "hearings on developing criteria for how future incentives should be awarded — a new process that values the jobs preserved or created instead of the tax breaks granted."
Fine. The problem is that Gov. Pat Quinn and legislators have had many previous opportunities to improve the climate for all job creators, not just major corporations, and consistently opted for politicized solutions that have had little positive effect.
Maybe this time, it'll be different. Hope, after all, springs eternal, even in Illinois.