IC Exclusive: Illinois Needs Reform for Recovery

By: State Senator Kyle McCarter

 

Last fall, the Paul Simon Public Policy Institute at SIU-Carbondale surveyed 1,000 Illinoisans about state government issues. 84% of registered voters told them Illinois was heading in the wrong direction. The poll, released on Oct. 10, 2016 found that taxes (27%) were the single biggest reason for leaving.

That level of dissatisfaction is not a surprise when you see what’s going on under the State Capitol Dome. The leadership in the Senate is pushing a “Grand Bargain” budget deal that is only “grand” in its demand for more taxpayer dollars. It’s certainly no “bargain.”

It calls for billions of dollars in higher taxes on income for individuals and corporations and new sales taxes on services. Working families and employers will be hit with tax rates back up to the level they were the last time income taxes were raised. That’ll cost you and I about two weeks of pay each year that the new higher tax rate is in place. In addition to the higher income taxes are dozens of new taxes on common everyday services we purchase. The Grand Bargain calls for sales taxes on cable and satellite TV, car repairs, dry cleaning, tickets to sporting events, club memberships, landscaping and many more services, too many to list without running out of space.

The last time we had a major income tax hike, 200,000 people fled Illinois to other states and Illinois continued to hemorrhage jobs, especially good-paying manufacturing jobs. While other states made adjustments to improve their business/jobs climate, following the 2008/2009 recession, Illinois kept it “business-as-usual.”

There is amazing creativity in Springfield when it comes to taking money out of people’s pockets, but there appears to be no creativity when it comes to reducing government spending and fiscal responsibility. Shrinking the size of government means more Liberty for the people. Unfortunately, it appears some people haven’t learned from past mistakes and instead are once again taking the path of penalizing the taxpayers.

I’ve heard from many people who are upset about what’s happening in Springfield. Here are just a few of the comments:

 

  • “Our company employs over 30 people…Our disgust with this state, the excess of Workers’ Comp and tax costs has reached a boiling point. With the introduction of the Grand Bargain…we had a vote of our board members…and made a unanimous decision to take the costly step of moving our entire business to Indiana.”
  • “Since I’m an owner of a 20-employee business and it looks like Illinois is not going to help me, I’m moving 12 miles west across the river. Just sad.”
  • My son-in-law and I own and operate a landscaping business in Fairview Heights. We are struggling with Workers’ Compensation insurance premiums. We have an excellent reputation…But, the burden is being placed on us by the State of Illinois. This burden is almost too much to bear, so much so that we are discouraged from growing the business and hiring more employees.”

 

While none of the tax increases included in the Grand Bargain have passed, just the talk of new and higher taxes is driving businesses out of state. It’s a signal that Illinois government just doesn’t get it. There’s no respect for those who are working hard and paying the taxes in this state.

There are options to the raise-taxes-or-the-sky-will-fall attitude at the Capitol that surrounds the Grand Bargain budget deal, but establishment politicians don’t want to consider alternatives.

Since 2011, I have offered ideas to balance the state budget, pay off billions of dollars in old bills, eliminate budget debt and address the public pension debt bomb Illinois is leaving to our children and grandchildren. None of these plans includes taking money from the pockets of Illinois taxpayers, rather they would ensure taxpayers keep more of their money. Unfortunately, these ideas were rejected because they required smaller government and less power for Springfield. Smaller government equals greater freedom for the people. Illinois government cannot demand a level of government the people cannot afford. Good things can come out of smaller government. Churches can do more and private charities can do more.

Indiana Gov. Mitch Daniels, who successfully shrank state government and championed fiscal responsibility once said, “You will be amazed how much government people can live without, once it’s gone.”Changing the budget process to make taxpayers the priority and get Illinois’ fiscal house in order is just one step of reform state government needs and Illinoisans deserve. As the comments above indicate, there are burdensome regulations – like Workers’ Compensation – that hamstring employers, limit business growth and squash job creation.

Illinois has the highest Workers’ Comp rates in the Midwest. We are losing employers, especially manufacturers, to other states where they can save hundreds of thousands of dollars annually. Our current Workers’ Compensation System lacks one key component that could make a positive difference. It’s called “causation.” Adding a causation standard to the System would ensure employers are treated fairly and injured workers would receive the medical care they need to quickly to return to work. Causation is defined as the workplace being the majority cause of the injury or illness. Such a standard appears logical, but under current Illinois law an employer who is found to be only 25% responsible for an injury or illness, would still have to pay for 100% of the claim.

Why does Illinois government stubbornly refuse to address the fundamental causes of its economic decline? Why would we repeat the mistakes of the past and run people out of this state? Let’s demand Illinois’ leaders move us in the right direction. Let’s demand this government live within its means, just like you and I have to in our families and businesses. Let’s remind Republicans who claim to be against big government that the solution to this problem is smaller government instead of higher taxes.

I urge you to contact your Representatives and Senators. Ask them to answer these questions and respond to our demands. Tell them to vote no on the Grand Bargain’s new and higher taxes. Tell them, #HandsOFFMyMoney!

carter