Cullerton Says Tax Hike "The Only Way Out," Questions Wisdom Of Temporary Plan
At a press conference in Springfield today, Senate President John Cullerton stated that the income tax bill (Sen. James Meeks' HB 174) approved by his chamber last month should serve as the "blueprint" for further budget negotiations, emphasizing that a vote for a ...
At a press conference in Springfield today, Senate President John Cullerton stated that the income tax bill (Sen. James Meeks' HB 174) approved by his chamber last month should serve as the "blueprint" for further budget negotiations, emphasizing that a vote for a tax increase "is the only way out." In the clip below, Cullerton went on to question the idea of passing a temporary, two-year tax increase, noting that some economists think the economic downturn will last longer than that. Listen:
CULLERTON: [HB 174] evolved and we have elements of it that are very attractive -- that's why we got 31 votes for it. Property tax relief is important. Having some progressivity is important. Recognizing that the corporate community is hurting now -- having only a slight increase for them. But we also need to raise money to pay for these devestating cuts that we otherwise would have. We're not a business that can just go out of business, because we have basic, fundamental services that we have to bring as a government. [...]
I personally think that two years is not what economists are saying is how long we're going to be in this recession. So why should it [the income tax hike] be two years? [...]
We put it out there. We voted. We got enough votes. Some people didn't want to, but they did. And as Sen. Forby reminded me, this is not without sacrifice. Our complete budget involved some cuts. It involved fully funding the pension system. Anything is negotiable as long as we keep the principles in mind that we need to balance our budget and not have these draconian cuts that all these people surrounding the capitol are complaining about today.
In the first passage excerpted above, Cullerton touches on a point we've emphasized before. The bill passed by the Senate was, in several ways, farther-reaching than the proposal defeated by the House. For instance, it was permanent rather than temporary and raised the personal income tax rate to 5 percent instead of 4.5 percent. It also incorporated some property tax relief and mandated some modifications to our inequitable school funding system. Those latter provisions gave lawmakers -- and their constituents -- something in return for their vote. That's surely part of the reason it passed.
Comments
The legislators who would not vote for a state income tax increase are divided into two camps: the Republican “Tin Man” searching for a heart, and the Democratic “Cowardly Lion” searching for political courage.
Together, in the Land of Oz, they share the fairytale – that not raising the state income tax and pandering to the cut-waste-reform-first mantra --- will ensure long political careers. Nothing is farther from the truth.
They had no trouble increasing millions in revenues on user fees, and sales taxes---dollar and dime the taxpayers to death, while avoiding tougher challenges to overhaul the property tax and income tax system.
Illinois was in a fiscal mess years ago, under the last 3 administrations. Those budgets were “balanced” by under funding pensions and creative accounting even when the economic times were better -- when real estate values were exploding and Illinois was raking in property tax dollars.
California and Illinois are in the top 3 states with the highest budget deficits.
California has 36.7 million residents and a $16 billion deficit. Every man woman and child in that state would have to pay $435 to cover their budgetary black hole. But in Illinois , with 12.9 million residents and a $11 billion deficit every resident would have to pay $852 to dig themselves out of our deficit pit created by the state's CEO's--- the legislators.
Both parties spent our money like drunken sailors, and part of the problem was the pay to play and no regulations on state contracts with the private sector, which was only addressed in this legislative session!
Thank God we have a fiscal conservative and reform minded Governor with courage to say yes to a modest 1.5% tax increase and reforms to the public pension system that’s drowning generations in debt.
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