Sunday, July 9, 2017

What, exactly, was the point of all this, Governor?



What, exactly, was the point of all this, Governor?

By Crain's Editorial Board

You want to breathe a sigh of relief, you know you do. Go ahead. After two years of pain, Illinois, you're entitled. Your elected leaders finally have done what responsible adults should have done all along—namely, negotiate a spending plan for the state and pass it into law. The $36 billion fiscal 2018 budget—passed with bipartisan support despite every effort by Gov. Bruce Rauner to kill it—reduces spending from the previous year, raises income taxes a lot and starts paying down $15 billion in overdue bills that piled up while the state spent years being a willful deadbeat.

What a shame legislators weren't willing to compromise until they had to stare down the business end of a junk rating from the nation's credit agencies. Still, the deal got done, though it won't pass any partisan's purity test. It doesn't relieve Illinois residents' property tax burdens. It cuts more deeply into higher education spending than many would like. And on and on.

But the upside is that the budget contains the new revenue that all sides—including Rauner, despite his campaign rhetoric—eventually acknowledged was needed. The individual income tax rate will climb from 3.75 percent to 4.95 percent, the same level it was under Gov. Pat Quinn, and the corporate rate from 5.25 percent to 7 percent. The hikes combined are expected to raise about $5 billion a year. In the end, even business groups like the Civic Committee of the Commercial Club of Chicago advocated for plans much like the one that finally passed, reasoning that stability was preferable to mutually assured destruction.

So Illinois spent two years setting itself on fire in order to do . . . what, exactly? Income tax rates now stand at 2014 levels. Pensions are still underfunded. The major "Turnaround Agenda" ideas the governor ran on—"right to work," workers' comp reform and term limits—were kicked to the curb over time like so much roadkill. The state, meanwhile, has been the customer from hell to social service agencies and small businesses alike, demanding services and refusing to pay for them, racking up millions in unnecessary interest charges and forcing private-sector layoffs along the way.

Rauner presided over all of this—and, at key moments in the spectacle, could have prevented it. Not a good look for a man who ran as a business-minded pragmatist, a dealmaker who would put the needs of regular Illinoisans first and reject petty partisan politics.

In the end, Rauner's stance on the budget compromise revealed how political this supposed "non-politician" has actually become. Despite knowing the damage that further ratings downgrades would do to the state, despite understanding the real damage being done to universities, businesses and municipalities by the ongoing standoff, despite recognizing that there is no way cuts and reforms alone will dig Illinois out of its financial hole without new revenue, the governor vetoed the budget legislation when it came to his desk. He did this knowing the chances were very, very good that his veto would be overridden.

There were plenty of political benefits for the governor in this irresponsible move: The guy who said he wasn't a career politician gets to appease his base, which is howling to the point of threatening violence against lawmakers who voted yes on the budget. He also gets a workable budget that will hold the wolves of Wall Street at bay at least for a time. And as an added sweetener, he also gets plenty of partisan fuel for a re-election campaign he once told us he'd be happy to skip if it meant he could get the job done in Springfield for the people of Illinois.

What a waste.

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