It looks like Bruce Rauner won’t lower the Illinois income tax.
It was great that Illinois got a Republican governor. What is not so great is the false hope that fueled his campaign. Megan McArdle writes, “Land of Lincoln Scrounges for Pennies.”
Illinois’s new Republican governor is walking into a big mess. The state’s pension system is a disaster, and while legislators have tried to alter the system to make it more affordable, their plan is currently wending its way through the courts and may well be overturned. There’s also a backlog of other bills, and the state is paying a premium on its debt because of its fiscal issues. The Land of Lincoln, says Reuters, is “buckling under a chronic structural budget deficit and the lowest credit ratings and worst-funded pension system among the 50 states.”
Okay, but there is no way Rauner could have been unaware that he was walking into a huge mess. He is now facing a hostile Democrat legislature that is not about to cooperate with him.
So why did he make the promise? Why did voters vote for him on the basis of a promise that he didn’t have the power to deliver?
In reality, they probably voted for him because he was better than the Democrat, but that doesn’t raise the bar very high.
The fact is, the only way to save Illinois is to roll back and abolish vast swathes of the Illinois state government apparatus. What would especially require some cuts are the pension obligations. But is that even legally possible? Right now, the status quo is that public employees, as union members, have a right to their jobs. Taxpayers are obligated to support them.
So what was Rauner’s plan for all of this?
The least he could do is force the legislature, if they want to raise taxes higher (which they do), to override his veto. But it looks like he is even unwilling to use his veto despite his promise to voters! He is actually pretending he didn’t know how bad it was (a palpable lie).
As economic blogger Mish writes,
Clearly Rauner has few solid proposals.
But instead of forcing Democrats to override his veto of a tax hike bill, Rauner appears ready to throw in the towel already.
Former governor Pat Quinn “warned lawmakers that years of progress would be reversed if tax hikes expired.”
Progress for Illinois democrats is tax hikes, followed by tax hikes, followed by more tax hikes simply to cover inane benefits of public unions while taxpayers and businesses flee the state.
And now Rauner appears ready to go along with tax hikes because “state finances are in even more dire shape than he thought.”
Our only hope is to shame Rauner into a position that displays a backbone rather than a wet noodle.
I don’t see any reason to believe Rauner really lacks “a backbone.” I think this was his plan all along. If he refuses to veto a tax hike then the political class can claim this was a “bipartisan” consensus. The Democrats can try to escape the blame. Rauner, by becoming governor, has provided a way for the Democrats to cover themselves. When a man makes decisions with foreseeable consequences the simplest explanation is that he wanted the consequences. Since we know politicians lie to get votes, there is no reason to believe any story about Rauner being surprised by the financial realities of the state. He knew what he was going to face and it is all part of his political ambition.
Already, half the people in Illinois wish they could leave. In the next four years, many of them will have new motivation to do so. And remember, in the midst of this implosion, the legislature is talking about building a temple to their god Obama for $100 million (which will probably cost way more).
The good news? The Illinois state will collapse, hopefully starting a collapse in other states that brings down the entire system of fraud and deceit. That’s what I’m praying for. Let our slave masters end up in poverty. The rest of us will recover and survive.