Tough medicine for a sick state

Tough medicine for a sick state

The only reason Illinois is not on its death bed is because states don't die. Failing ones just keep blundering along.

It remains to be seen how long Illinois will follow that path to sorry and devastation. If readers listen to Gov. Bruce Rauner's budget address Wednesday, they'll get an idea just how bad things are and what steps — difficult ones the Legislature will ignore in this election year — must be taken.

Those who eschew partisan prescriptions of the problem and the solutions should examine the Chicago-based Civic Federation's proposal to stabilize the state's finances.

If hearing a doctor discuss what's required to get better, exposure to the Civic Federation's recipe for the recovery of the state's financial health should let people know how bad off the state is.

What's the problem?

Billions of dollars in unpaid bills, deficit budgets for years on end, $130-billion-plus in underfunded public pension. Illinois spends so much money on Medicaid and pensions that it has little left for public educations, transportation, law enforcement, etc.

The Civic Federation noted that some believe the budget passed by legislative Democrats over Gov. Rauner's veto might ease the problem. Instead, the Civic Federation's Laurence Msall asserts that the 2017-18 budget "relied on shaky financial practices for short-term relief" and continued to "kick the pension can down the road," decisions that will "make achieving sound financial footing more difficult." Or maybe even impossible?

The Civic Federation is not recommending a state income tax increase because the Legislature just passed one. It says another tax hike "would not be welcomed."

Here's what it is proposing:

— Limiting public agency spending increases to 2.1 percent a year through 2023.

— Reducing the state's stupid 1 percent a month interest rate on unpaid bills to "market-based rates."

— Extending the state's sales tax to 14 additional services that also are taxed by Wisconsin.

— Consolidating and streamlining government units in Illinois. Is the Urbana City Council or the Champaign County Board listening?

— Passing a state constitutional amendment to address skyrocketing state pension costs.

— Making supplemental pension payments.

— Merging the Teacher's Retirement System with the Chicago Teachers Pension Fund.

— Creating a bipartisan commission to rationalize and consolidate the state governance of higher education.

— Initiating a capital spending plan financed by a hike in the motor fuel tax.

Some of these proposals will make many people angry, and it's easy to understand why.

No one wants their ox gored. But the Civic Federation insists that tough medicine is needed, and the longer the state waits to get serious about its governance the more unpleasant the medicine will be.

"Building political will to implement more painful tax and fiscal policies will be difficult, but it is necessary in order to secure Illinois' financial future," Msall said.

He's right.

The problem is that sober observers of Illinois' financial woes have issued similar prescriptions for a long time, and few paid attention.

Now there's another warning shot across the bow. Is anyone listening?

Sections (2):Editorials, Opinion

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catsrule wrote on February 13, 2018 at 11:02 am

"— Passing a state constitutional amendment to address skyrocketing state pension costs.". Prohibitions against Ex Post Facto legislation and the Contract Clause of the US Constitution (Article I, section 10, clause 1) will prohibit changes for any current employees. Additionally, the ILSC has made it clear that employees cannot be coerced into making a choice that diminishes the benefit level they had when they became members of a given retirement system (i.e. SURS, SERS, etc.).