Jobs - that's the answer to getting us out of a recession. Private sector jobs. What do Madigan and Cullerton and Quinn come up with - a MASSIVE income tax increase and a push to chase all Amazon.com retailers out of IL.
The tax increase that will have the biggest effect on our local economies is the one that I don't see much discussion about - it's the corporate income tax increase. Does anyone thing that Caterpillar is going to take this lying down? It is a massive disincentive to locate your business here, and it is a nice incentive to move your business to another location.
In other news, democrats decide to force Amazon.com and other companies to collect an additional 6.25% and from their customers and pass it along to the IL state treasury. Why, because some companies located in IL are selling products on their site. Amazon.com's response is to close the book on these vendors, effectively moving all of these companies out of the state, with their property tax and payroll tax and corporate income tax and personal income tax and sales tax they pay for things they buy for their personal and business use, all in tow.
When consumers become stressed financially, lenders see a trend in their credit report and react. When lenders look at the frequency and severity of poor credit decisions, and they react by cut credit off, or loaning money at the highest rate possible. The taxpayer is the lender in this case, and is making a horrible move by allowing the consumer (state of IL) to take more and more of our income without changing the way they do business. This is especially dangerous to the long term financial stability of the state, because they are making decisions that negatively affect our business climate now and well into the future.
Talk about bond markets going
Talk about bond markets going nuts. The only reason why they haven’t thus far is because the lions share of governmental debt is in the states themselves. Give states the ability to file for bankruptcy and the rates will skyrocket, making it nearly impossible to afford which will trigger defaults, which will cause higher rates, which will ……
Don't really know who to thank more.
The Democrates for their tax and spend.
Or the Republicans for their borrowing and spending.
Neighboring states gleeful
Neighboring states gleeful over Ill. tax increase
"It's like living next door to `The Simpsons' — you know, the dysfunctional family down the block," Indiana Gov. Mitch Daniels said in an interview on Chicago's WLS-AM.
"Years ago Wisconsin had a tourism advertising campaign targeted to Illinois with the motto, `Escape to Wisconsin,'" Wisconsin Gov. Scott Walker said in a statement. "Today we renew that call to Illinois businesses, `Escape to Wisconsin.' You are welcome here."
Illinois state Sen. Dan Duffy, a Republican, labeled the tax increase "the nuclear bomb of jobs bills."
There was even some carping from Illinois Democrats. Chicago Mayor Richard Daley predicted jobs will start trickling out of Illinois with little fanfare.
"Businesses don't have press conferences like this and announce they're moving 50 people out, 60 people out, 70 people," Daley said at an event in Chicago.
Bill Ecton, 54, owns Ecton's True Value Hardware in Robinson, Ill., just a few miles from the Indiana border. He was resigned to the fact that Illinois ultimately would raise taxes to repair the budget, but he said the taxes will take a toll.
"If I have to pay more to the state, it's money that I can't pay out in wages," Ecton said. "I'm not saying I'm laying people off, but maybe I'm going to look twice at adding another one."
However,...
But Illinois' governor rejected the idea that the increase would allow other states to lure jobs away. "Lots of luck to them, but that's not going to happen," Quinn said at a news conference Wednesday.
Businesses look at more than taxes when making financial decisions, Quinn said. They also look at whether state government is stable and able to provide good roads and schools.
"It's important for their state government not to be a fiscal basket case," Quinn said.
A Wisconsin company seemed to prove his point.
Train-maker Talgo Inc. is threatening to leave Milwaukee because Wisconsin rejected federal funds for high-speed rail. Talgo still considers Illinois a strong possibility for its new the company's new home, despite the tax increase, said spokeswoman Nora Friend.
The tax increase "would not weigh in as a positive, but it's difficult to say whether it's the deciding factor," Friend said. "It would be one more factor that gets weighed in."
Illinois Democrats note that even after the increase takes effect, the 5 percent personal income tax rate will still be lower than many nearby states'.
The top personal rate in Wisconsin is 7.75 percent, for example, and Iowa's is 8.98 percent. Indiana and Michigan will have lower rates, however — 3.4 percent and 4.35 percent.
http://news.yahoo.com/s/ap/20110113/ap_on_re_us/us_broken_budgets_battli... [6]
Note: Many states have graduated income tax rates.
The votes are in! It's
The votes are in! It's bankruptcy!
A Path Is Sought for States to Escape Their Debt Burdens
http://www.nytimes.com/2011/01/21/business/economy/21bankruptcy.html?_r=... [8]
The debt crisis in Illinois
The debt crisis in Illinois is just the beginning, just wait till you get our Federal bill, it will make Illinois seem like a down payment on a McMansion.
I’m with Buz, let’s slice the state along I80 and let the top half become Chyland. You would see it collapse under its own burden weight, since Chicago could not function without the huge amounts of revenue that flow from the farm fields further south.
Yes Chicago does generate large revenue streams but they consume HUGE amounts of tax coffers in supporting a crumbling social construct and physical infrastructure. Cut them off and you would see a dramatic resurgence downstate as we would be able to more than support ourselves.
But alas, it is only a pipe dream (don’t you miss those Buz I know I do) since the strangle hold of corporate consumption is firmly in place. A world in which we buy today and pay tomorrow, because we’ve been trained to believe the glass is half full and there is always more water to fill it with. Right?
I mean come on, Boeing moved to Illinois because our leadership said “oh don’t worry about paying taxes, you’ll be good and make it up later”. We trust you robo-corporations, since you always look out for our best interest and will make us all rich. A corporation that will jump state the second their contractual agreement has been met and they have to start paying taxes again.
Something I’ve come to realize in recent weeks, is that nearly all our problems inherent in our society today is because of consumerism. A mass social movement of consuming now, of instant gratification on borrowed money at personal, educational, government and social levels, a drunken orgy of consumption that now consumes our incomes with interest for past purchases.
But don’t go blaming all this on the Democrats. Yes, like thief’s in the night they made us all pay, but the Republicans have as much hand in this as anyone, repeatedly giving away the family heirlooms to corporations because they love them more than their children’s futures. Then run gubernatorial candidates so right wing that only the radical party hacks, with no olfactory senses for the stench of fascism, will vote for them.
So bad was the stench to people like ourselves in the 2010 election, that the gubernatorial candidate loss to a Democratic governor running for re-election on a platform of “More New Taxes”. How sad and telling is that?
Yes, that’s what this country needs is more right wing radicals, helping to keep in line those LIBERAL GOD HATTING COMMIES WHO KILL BABIES LOVE OUR ENEMIES (WHO ARE ANYONE THAT’S NOT AMERICAN) AND ARE THE SCURGE OF ALL THAT IS WRONG IN AMERICA TODAY TOMORROW AND FOREVER AMEN.
Sorry, apparently I accidentally channeled oxycoden Limbaugh there for a moment.
Yes we’re in a mess, one contrived by the House of Rothschild, designed by the Builderberg’s and managed by the New World Order. They have gathered the serfs, who are followed their multi-generational plan, serfs who now begin paying only the interest on a principle never to be repaid.
" Corporations care very much about maintaining the myth that government is necessarily ineffective, except when it is spending money on the military--industrial complex, building prisons, or providing infrastructural support for the business sector."-- Michael Lerner, from the book The Politics of Meaning, 1997, p315
Realistic solutions:
Create our own Illinios currency based on precious metals.
Legalize pot – hundreds of millions a year in tax revenue, untold billions saved through penal, law and legal expense,
Decriminalize all drugs and make it a public health issue instead of a criminal justice issue.
Cut all state funding to all areas by 20% (of course the penal system could be cut farther since populations would drop by at least 50% due to drug related inmates.
Create and fund a “preventive” health care system not based on destructive and incredibly expensive pharmaceuticals but holistic approaches. A system that would also treat drug “abuse” as it reduces the cost of emergency room sniffle care.
Raise taxes 1%
If we did this, companies would flock to Illinois for the reduction in costs and the realization that we are a progressive state and therefore worth investing in.
I'm with you on the
I'm with you on the decriminalizing drugs, cutting spending, funding preventative care, and raising taxes. I'll also throw out these:
Deunionize workers that make over 2/3 of the national average pay, at least the state workers. No more plumbers making $75k and mowers making $55k because a union got them a sweet deal and not because they're such specialized jobs requiring advanced skill or training.
Give new state employees the choice between Social Security or a 401k and eliminate the pension option. Change the constitution to allow changes to existing employees' retirements.
Cap state workers' pay at no more than the governor's $155k except maybe a few specialized ones like UIC's teaching surgeons. No more U of I presidents making $660k. If my family can make it on just over 1/3 of Illinois' $41k GDP per capital with my state paycheck, I think administrators can make due with $155k. It's public service, it's not supposed to be easy or profitable. If they don't want to do it, I'd gladly do it for even less!
Consolidate common functions across all state agencies such as IT and HR.
Clean up state procurement laws so we don't have to report EVERY procurement-related communication or force vendors to fill out a ton of paperwork for the privilege of doing business with the state if over $50k. Really, do I have to report it if I asked a store clerk where the office supplies are so I could buy $10 worth of paper? What about back and forth email? Should I file a report saying the vendor replied "yep" and another report saying I replied back saying "thanks"? How much money is being spent on salary time reporting trivial stuff? How about even having the reporting system functional by the time I'm required by law to submit one? And what benefit does the business have to fill out paperwork when they're already giving a govt or academic price discount? We'll see that discount eliminated at least on smaller purchases. Meanwhile, purchases take a month or two to process meaning you might overbuy to hedge against delays and products might expire or get damaged being stored for a long time. And the laws don't account for consolidated purchasing for volume savings. If each University department buys less than $5k from a particular vendor, they can each use a credit card with minimal paperwork. If that exact same volume of purchase was handled as a single large purchase with 25% savings but now falls over $50k because two dozen departments are involved, suddenly there's a ton more paperwork even though the end result is actually a better deal for the state.
An informative article about
An informative article about the state of our State:
Hard Times in Illinois
http://www.rense.com/general92/hard.htm [13]
'Besides its $13 billion deficit and $6 billion in unpaid bills, its pension fund is about $130 billion in the red...'
Think the Repubs could've put the reins on the many state-employee unions?
It's my observation that a change in political leadership only means that a different group of people will take our money. Two wings of the same bird, two sides of the same coin, etc., etc., ad nauseum...
So what do you think a
So what do you think a realistic political solution to this statewide problem would be?
Realistic? Hmmm... ... ...
Realistic? Hmmm... ... ... You would have to qualify that...
Have Chicago be it's own state? Being the most politically corrupt city in the nation and where too many Illinois tax dollars are spent, I'd vote for that.
How about Illinois being the first state, in a long list to come, to declare insolvency? I'd also vote for that.
According to the 2010 Census, Illinois lost 19,000 residents and a seat in the House of Representatives. I'm going to go out on a limb here and assume that these people moved seeking employment or escaping unfriendly state taxes and fees. Higher taxes on individuals and corporations will only heighten this trend. The state legislature and Governor are going in the wrong direction. It's pension fund is $130 Billion in the red! This 'temporary tax increase' coud be the start of a trend. 'Temporary'... yeah, right.
I say declare insolvency and have a judge (NOT from Chicago!) sort it out. If 'all' state employees have to work until they're 65 to retire,...well, welcome to my world. If the U of I is to survive at all, then state budgetary matters 'must be' removed from the control, or rather the obvious 'lack of,' of corrupt Chicago politicians.
If the State won't do it, I predict headlines in the near future of various cities and towns across the state declaring insolvency because of the decaying housing market that will result in devolving property tax revenues. No jobs = no new home buyers & continuing foreclosures.
Illinois taxpayerss didn't create this problem (although an argument could be made that voters are ignorant) and we shouldn't be forced to solve it.
I hope you read the article.
The Soviets couldn't make communism work and we can't make capitalism work. But perhaps that topic's best left for another thread.
Even though we bemoan the
Even though we bemoan the fact that Chicago causes us problems, we can't forget that they are a massive source of income for the entire state - not just Chicago. We (downstaters) benefit from their population numbers and their incomes, and thus their taxes. Chicago will always be the engine that drives Illinois, so I don't think cutting them into their own state is realistic.
However, insolvency is a realistic option, although not one that will be chosen by politicians. As long as they can tax their way out of a mess, they can spend their way into office.