Unlike Illinois, Ohio has a Republican governor, John Kasich, and a reformist Republican legislature. Unlike Illinois, Ohio's governor ruled out tax hikes as a way to address his state's budget hole ($8 billion). And unlike Illinois, whose Medicaid cuts mostly do nothing to slow the growth of spending, Ohio's Medicaid program expects to see its annual rate of increase cut in half.Meanwhile, Illinois punts on pension reform, and Rahmbo wants to be a casino kingpin.
How did Buckeye Republicans do it? It turns out that when you can't rely on dubious revenue projections, you get more serious about spending. When Mr. Kasich's people looked at Medicaid, they found that 4% of Ohio's Medicaid cases accounted for 51% of the spending. That allowed them to address costs while improving care—e.g., coordinating care for the most expensive, chronic cases instead of just having them show up in emergency rooms.
In sharp contrast, the cigarette tax in Illinois raises many more questions than it answers. Take the projected $350 million in revenue, which is designed to help close a $2.7 billion Medicaid gap.
Illinois is unlikely to meet that target, if only because it is bordered by several states that will now have much lower tobacco taxes.
P.S. Michael Boskin and John Cogan: California's Casino Budgeting - WSJ.com
Byrne: The gutless governing continues in Illinois