Democrats are blaming these budget woes on the lousy economy. The real culprit for the budget imbalance is skyrocketing public-employee pension costs.
Officially, Illinois is a state with an $80 billion unfunded pension system. Yet a study by Joshua Rauh, an associate professor of finance at Northwestern University's Kellogg School of Management, puts the funding shortfall at closer to $150 billion.
The state still assumes that it is going to get a fat 8% rate of return on its pension investments. But over the past decade the returns were half that, which is why many actuaries believe that this return is pure fantasy. The pension payouts are gigantically lucrative, with many workers getting 80% of their final four-year pay. That includes a cost-of-living adjustment and can also include stacked-up overtime. The retirement age is 55 for many public employees.
Who can forget the bullying identical signs rally in Springfield busing in thousands--retired at 55 or loafing on the job already. Living in lalaland Dem Illinois on the verge of a death spiral.
Illinois Policy Institute offers an income tax calculator under the Quinn/Dem plan--which the House left town without passing--so call (217.782.2000 capitol switchboard) your legislators! They haven't cut substantively and they're borrowing more to pay day to day expenses. A death spiral.
More from IPI:
Following up on the Illinois attack on bloggers and small businesses: Amazon Tax Passes, Shows What Will Happen If Income Hike Does Too
More. From the Illinois GOP:
Say No to the Illinois Democrats' 75% Tax Increase
Sign the Petition at NoIllinoisTaxHike.com
Governor Pat Quinn, Senate President John Cullerton, and Speaker Michael J. Madigan (who’s also the Chairman of the Democratic Party of Illinois) are trying to rush through a 75% Tax Increase in the final days of the lame duck session of the State Legislature.
This is the latest example of life in
While Illinois’ budget problems are grave, the answers lie in first attacking the excessive spending and enacting structural reforms that are needed before any new revenues are even considered. We cannot let the Democrats drive business out of Illinois and all of the jobs that go with it.
Madigan, Cullerton and Quinn talk a big game about reform and job creation, but they fundamentally lack the courage to make the tough decisions to put Illinois on solid financial footing. We are the only state in the union to push massive tax increases without accompanying spending cuts. Even other states with Democrat Governors like New York and California have recognized the need for cuts before tax increases. Reform exists everywhere but in