CHICAGO—While much of the national press follows Washington deficits, the red ink is spilling over in this blue state in America’s heartland. Illinois State Comptroller Judy Baar Topinka has repeatedly sounded warnings about the state’s constantly shifting shortfall, as unpaid bills reached about $8 billion at the end of 2011.
Deficit spending ballooned under former Gov. Rod Blagojevich, the state’s second governor in a row to be sentenced to prison for corruption. Since he left office, Illinois has not seriously grappled with the left-over spending problem, which includes a thorny pension obligation.
Instead, Democratic Gov. Pat Quinn signed a large tax hike bill. “We’ve taken $7 billion out of the pockets of the private sector and put it in government,” said state Sen. Kyle McCarter, an opponent of the tax measure. “[Families] lost a week’s pay. That’s a lot of groceries.” Ted Dabrowski of the Illinois Policy Institute says the state’s political leaders “knowingly haven’t cut costs.”
McCarter, a Republican, acknowledges that Illinois has no easy path back to fiscal responsibility. Republican senators have a proposal that attacks the spending side, rather than turning repeatedly to raising taxes. But both houses of the legislature are controlled by Democrats, and he says they prefer a “waiting game,” hoping the economy will improve and revenue will increase.Continue Reading on www.worldmag.com