They have a flat income tax of 3.75%. Many states have flat rates higher than that and/or graduated income taxes. I don’t buy the “cannot be taxed anymore” nonsense.
Boomers seem to assume that their benefits will be paid in full without their taxes going up today. They can’t be so ignorant as to not realize that that leaves only one source to pay for their benefits when they retire: young people. Which will not happen.
Turns out you’re right, Illinois is not a top 5 state in terms of tax burden, but you also have to take into account politics. Will voters pay more? Is Illinois that awesome a place to live that people will accept high taxes and not move? New York and California I get. Even Alaska, since supposedly the kind of people who want to live in Alaska can’t really go to another state that’s anything like it. But Illinois is just an ordinary midwestern state like Wisconsin or Indiana or Ohio or Michigan. Illinois can’t compete if the neighboring states have lower taxes.
Anyway, the point is that unlike Kansas and Oklahoma, they can’t raise taxes to get out of their situation. The hole is big and growing bigger and if they can’t pay their bills with the economy as it is now, the next recession will turn them into a banana republic. They have no option but to renege on the pensions.
As a Michigander, I happen to think my state, unlike the others you cite (ESPECIALLY OHIO!), is far from ordinary.
As noted, their taxes are not particularly high. They could solve the crisis very quickly if they only had the will for a modest tax increase. Of course Republicans think any tax increase makes Baby Jesus cry so they will continue to resist all attempts to steer the ship away from the approaching reef.
It turns out that people do choose what state to live in, even among Midwestern states, based on factors besides tax rate. Minnesota, for instance, has higher taxes than the surrounding states, so we aren’t in a financial hole (though the Republicans controlling the legislature are doing their damndest to put us into one), and yet, the state isn’t emptying out.
Illinois is still pretty high:
Now Minnesota, how much of their budget do they pay in pensions? That could be making all the difference.
According to this source, Illinois is spending nearly a third of its budget on pensions:
Minnesota is paying 17%:
Conclusion: Minnesota is just better governed, which is also a factor that can lead citizens to more acceptance of higher taxes. When your higher taxes just pay for overgenerous pensions for government workers, that’s going to create some voter resistance.
Why not?
Because if they could, they would. If they aren’t, then it’s either because they know they can’t squeeze anymore blood from the rock, or that the state will turn red in the next election at the legislative level. The Democrats in the legislature know that they can give pensioners a haircut on their own terms, or they can lose to Republicans and have the pensioners eating dog food.
Keep in mind the context here… Ever since 2010, Illinois’ neighboring Republican states have been loudly encouraging businesses and the affluent to consider relocating. That’s going to put a natural constraint on how much revenue they can raise.
I do notice from the chart I posted that Illinois has low property taxes. Given that this appears to be the best untapped source of revenue, how well do you think middle class Illinois voters will accept a steeper property tax? Illinois does have a fairly low income tax RATE, but the base is pretty broad and it does seem to raise a lot of revenue, comparable to states with higher rates. I suppose they could try to raise that more, but again, it’s a flat tax and I’m not sure how well Illinois residents would take that.
I suppose they could tax the rich more, but the rich mainly live in Chicago, and they can literally walk to Wisconsin. Scott Walker would be happy to have them, and to brag about it publicly on Fox.
I don’t know where you live, but in Illinois the General Assembly has to write and pass any spending/tax bills. The Governor can’t do it by divine fiat.
I live in Chicago. Born and raised. I’ve had a first row seat to what’s been going on in my state. You’ve made yourself clear, and your partisanship has been laid out for everyone in the thread to see.
Just saying it’s the governors fault when he hasn’t been in office long and Democrats control the budget isn’t exactly unbiased.
Did Rauner propose a budget that would have prevented this? If not, then sure, he can receive a lot of the blame. But if he did, and the Democrats rejected it, then it’s on them.
One worry I have with increasing the Illinois tax rate- despite it’s low rate- is that people are moving out of the state. Raise it up higher and more people will leave. So even raising taxes might not work.
Illinois is running out of solutions, if both parties can’t come together, Illinois will default.
I personally have never known one person to leave a state during their working lives in order to avoid state taxes. I think it is so rare as to be negligible.
I don’t have a cite handy, but I can search for one if someone insists. Illinois has had the highest population loss of any state in the Union.
If you re-read the thread I said that it wasn’t a one party problem. D’Anconia is the one who laid the blame entirely at the Democrats feet and absolved Rauner of all blame.
Take it up with him. I don’t claim that the Democrats are innocent, but it takes two to tango, and when the Governor refuses to cooperate or work together and only makes unreasonable demands that largely have nothing to do with the budget issues he certainly has some culpability, especially when he specifically campaigned on working with the legislature to solve the issue. He has failed on everything he campaigned to do.
I don’t know why you are making this personal in Great Debates. 
Watching you guys trying to blame your opponents’ party is such fascinating and enriching political discussion. Really helps me understand this budget crisis. :golf clap:
according to this cite, Illinois is indeed hemorraging residents. And the trend has been consistently worse.
Neighboring states are also losing residents, at a slower rate. Minnesota is gaining residents.
Minnesota also happens to be the only successful blue model state I can think of when it comes to not having frequent cash crunches.
Again I started out saying that it wasn’t a one party problem, and have not deviated from that position.
Why the false equivalency with what D’Anconia has been arguing?
Point your sarcasm where it belongs please.