The state of Illinois is experiencing the fiscal shit storm of the century. Minnesota isn’t far behind.
The difference? There’s a chance Minnesotans won’t get the shaft like like our friends in Illinois just did.
Our hard-won and just-in-time GOP majority, if our elected representatives stay true to their mission, will force a different tact in the Land of 10,000 Lakes.
Illinois Gov. Pat Quinn defended a massive increase in state income taxes passed by lawmakers Wednesday and promised to quickly sign the measure to help heal the state’s ailing finances.
Lawmakers worked overnight to pass the increase to raise the personal income tax rate from 3 percent to 5 percent for four years — a 66 percent increase. Corporate income taxes also will rise, but Quinn rejected the notion that it would decimate businesses.
Then again, that’s not the point. The point is that governments both State and Federal will continue to spend beyond their means as long as they know that they can always raise taxes down the road.
The rate increase might be the biggest any state has adopted in percentage terms while grappling with recent economic woes. Nevertheless, Illinois’ tax rate would remain lower than in several other states in the region.
Some comfort that must be. They’re less worst.
“It’s important for their state government not to be a fiscal basket case,” Quinn told reporters outside his Capitol office.
Legislative leaders rushed early Wednesday to pass the politically risky plan before a new General Assembly was sworn in at noon, taking a slice out of the Democratic majority and removing lame-duck lawmakers willing to support the tax before leaving office.
Nice move. Screw the people and vacate.
The tax increase will be coupled with strict 2 percent limits on spending growth. If officials spend above those limits, the tax increase will automatically be canceled. The plan’s supporters warned that rising pension and health care costs probably will eat up all the spending allowed by the caps, forcing cuts in other areas of government.
Here’s a novel idea. How about a spending freeze? Everyone else has had to do so. Why not government?
House Speaker Michael Madigan said Republicans should have supported some parts of the plan instead of voting against everything. The proposal passed the House on Tuesday night 60-57, the bare minimum. No Republicans backed the measure there or in the Senate, where the measure passed 30-29.”They’re on the sidelines. They don’t want to get on the field of play,” the Chicago Democrat said. “I’m happy that the day has ended.”
But Republicans noted they were not included in negotiations. They also fundamentally reject the idea of raising taxes after years of spending growth.
…but there apparently weren’t enough of them to prevail. Luckily for Minnesota, we painted our House and Senate Red just in time.
“We’re saying to the people of Illinois, `For eight years we’ve overspent, now we’re going to make it your problem,’” said Rep. Roger Eddy. “We’re making up for our mistakes on your back.”
The increase means an Illinois resident who now owes $1,000 in state income taxes will pay $1,666 at the new rate. After four years, the rate drops to 3.75 percent and that same taxpayer will then owe $1,250.
Republicans predict the tax eventually will be made permanent.
That ladies and gentlemen is what we call “The Slippery Slope.”
“It’s a cruel hoax to play on citizens to say this is temporary,” said House Minority Leader Tom Cross, R-Oswego.
Funny how that works for liberals. Tax cuts are always temporary. Tax increases are always permanent.
Republicans also accused Democrats of doing irreparable harm to Illinois families and businesses. Business leaders decried the proposal as a job-killer.
“Based on this particular legislation the only businesses that will benefit are the moving companies that will be helping many of my members move out of this particular state,” said Gregory Baise, head of the Illinois Manufacturers’ Association.
I suppose having a sense of humor has served him well lately.
Governors of some neighboring states quickly jumped on the issue. Republican Wisconsin Gov. Scott Walker, who took office last week has already proposed a tax cut for businesses that relocate to Wisconsin from other states, invited companies to head north.
Atta boy. I’m still coveting.
“Years ago Wisconsin had a tourism advertising campaign targeted to Illinois with the motto, ‘Escape to Wisconsin,’” Walker said Wednesday in a statement. “Today we renew that call to Illinois businesses, ‘Escape to Wisconsin.’ You are welcome here.”
“And we won’t tax you up the wazoo!”
Quinn scoffed at the notion. “Lots of luck to them, but that’s not going to happen.”
Except for the fact that it already is.
Democrats also bristled at being blamed for the state’s financial problems, although they’ve controlled the governor’s office and both legislative chambers since 2003.
Thank God that never happens in Minnesota (crosses fingers).