Cor­rup­tion erup­tion in­vites a Demo­cratic tax de­ba­cle

Chicago Tribune (Sunday) - - EDITORIALS -

Fifty weeks before vot­ers say yea or nay to Democrats’ plan for a grad­u­ated in­come tax that would rake in new dol­lars by the bil­lions, here’s what the peo­ple of Illi­nois see:

■ Cit­i­zens see fed­eral agents rip­ping at the in­nards of Illi­nois gov­er­nance and pol­i­tics. From clout artists at Chicago’s City Hall to lob­by­ists for a big util­ity to one state leg­is­la­tor who al­legedly tried to bribe an­other, the feds are ex­plor­ing how bills pass, how fa­vors flow and how politi­cians scam their fel­low cit­i­zens. Th­ese are in­di­vid­ual cases, for now. But the in­ten­si­fy­ing per­cus­sion of war­rants, raids and wire­taps re­in­forces the im­pres­sion that cor­rup­tion runs ram­pant here. Each al­leged wrong­do­ing reeks of greed and per­sonal priv­i­lege.

■ Cit­i­zens also see that sev­eral of the Democrats tainted by th­ese scan­dals played roles in rais­ing in­come taxes, prop­erty taxes, gaso­line taxes and so on. Yet their se­rial tax in­creases never are enough to cover all the spend­ing and bor­row­ing. Wit­ness the ab­ject fail­ure of the last two in­come tax in­creases, im­posed in 2011 and 2017, to be the grand fi­nan­cial fixes that law­mak­ers had as­sured all of us.

■ Cit­i­zens see, and ab­sorb as never before, the enor­mous bur­den of public pen­sions and other gov­ern­ment spend­ing here. The $10,000 limit on fed­eral in­come tax de­duc­tions for state and lo­cal taxes en­cour­ages more fam­i­lies to join the Illi­nois Ex­o­dus: Why wait for the next drop in house val­ues here? And why pay ever-higher taxes to cover as­ton­ish­ing over­head costs con­jured by the Illi­nois cul­ture of po­lit­i­cal sleaze?

Will more bil­lion$ some­how re­form Illi­nois politi­cians?

Against this sorry back­drop — the cer­tainty of ever more tax gouges, the wors­en­ing cor­rup­tion erup­tion — Gov. J.B. Pritzker and his fel­low Democrats want vot­ers to ap­prove their open-ended amend­ment to en­able grad­u­ated in­come taxes. Higher tax rates would hit big earn­ers first. What law­mak­ers refuse to ad­mit pub­licly — just try ask­ing them — is that they’ll next raise rates on mid­dle-class tax­pay­ers, too. That’s where the real money is.

Pritzker & Co. are re­ly­ing on vot­ers to trust — trust! — that with grad­u­ated rates suck­ing more money out of peo­ple’s take­home pay, a sud­denly hon­or­able Spring­field would stew­ard tax­payer dol­lars with leg­isla­tive in­tegrity and spend­ing re­straint.

We won’t pre­dict how vot­ers will re­act to that du­bi­ous sales pitch. We are, though, pleased to stand with all the cheated Illi­nois tax­pay­ers (1) who don’t be­lieve gov­ern­ment here will mag­i­cally turn trust­wor­thy, and (2) who want Illi­nois just once to at­tack the spend­ing side of the ledger — es­pe­cially by re­form­ing public pen­sions.

The next year is, then, a fraught time for the rul­ing Democrats. Scan­dal tar­nishes their brand. Yet in Chicago and in Spring­field, they’ve com­mit­ted to so much past, present and fu­ture spend­ing that they have no choice but to keep propos­ing … more and higher taxes.

This des­per­ate search for rev­enue now in­vites a Demo­cratic tax de­ba­cle, with ri­val city and state fac­tions com­pet­ing to grab those fresh bil­lions of dol­lars.

FBI raids weren’t in the ‘Pritzker Tax’ play­book

When Demo­cratic law­mak­ers put their grad­u­ated-rates amend­ment on the Novem­ber 2020 bal­lot, they hoped not to breathe the word “taxes” un­til som­no­lent vot­ers ap­proved the game-chang­ing mea­sure. To anes­thetize testy tax­pay­ers, they formed a Prop­erty Tax Re­lief Task Force — as if they re­ally, re­ally want to off­set ris­ing in­come taxes with a sop to gullible saps.

Ever since that heady spring­time, it’s been lit­tle but bad news for what Pritzker calls the Fair Tax.

Fed­eral agents and prose­cu­tors likely didn’t set out to show Illi­noisans how cor­ruptly some of their gov­ern­ments ex­ploit their in­ter­ests. Whom do you ex­pect the feds to in­dict next?

Here, of course, what’s le­gal can be as of­fen­sive as what’s il­le­gal. Hence the public’s dis­gust when word spread that, be­cause Spring­field re­fuses to se­ri­ously con­front its re­tire­ment ben­e­fits cri­sis, state gov­ern­ment’s un­funded pen­sion obli­ga­tions have risen by an­other $3 bil­lion, to $137 bil­lion. Of course, that’s the math of bu­reau­crats who an­swer to Illi­nois politi­cians. The in­de­pen­dent num­bers crunch­ers at Moody’s In­vestors Ser­vice in­stead put the short­fall — tax­pay­ers are on the hook for ev­ery penny — at $240 bil­lion.

Yet you’re sup­posed to give Spring­field’s swift money man­agers more tax dol­lars?

Pritzker’s own Of­fice of Man­age­ment and Bud­get tele­graphed what we took as panic about the tax amend­ment’s prospects when it skewed a re­quired an­nual re­port to lobby for the Pritzker Tax. Voter re­fusal, the sup­pos­edly im­par­tial re­port warned, could bring “dra­matic bud­get cuts of ap­prox­i­mately 15% to many es­sen­tial ser­vices such as ed­u­ca­tion fund­ing and public safety” — or maybe, yes, yet an­other in­come tax hike.

(Pri­vate note to state fi­nance of­fi­cials: Don’t soil gov­ern­ment re­ports with threats that scream, “Gov­er­nor, how’d we do?”)

The Lori Light­foot com­pli­ca­tion

Chicagoans are about to learn how their mayor wants to meet the high costs of school dis­trict and City Hall spend­ing. Dur­ing their fall veto ses­sion, Pritzker and leg­is­la­tors didn’t ful­fill her re­quests for leg­is­la­tion to en­able fu­ture rev­enue from a casino, or from a re­vised real es­tate trans­fer tax.

Spring­field law­mak­ers and their apol­o­gists see Light­foot as a naif who doesn’t know how to play their game. We see her as a mayor who now may have to raise prop­erty taxes, and who owes Pritzker & Co. no fealty what­so­ever. If fed-up Chicagoans see higher city taxes as a rea­son to re­ject the Pritzker Tax, will Light­foot break a sweat try­ing to change their minds?

Put it all to­gether. Here’s what the peo­ple of Chicago and Illi­nois are hear­ing in­ces­santly: Hi, I’m (taxes) a Demo­cratic of­fi­cial (taxes), and we (taxes) just hate to (taxes) raise your, um, taxes. But we have (taxes) no choice.

Oh — that Prop­erty Tax Re­lief Task Force, the eye­wash? For now you can fugged­abou­dit. Task force mem­bers blew their Oct. 31 dead­line to give Pritzker and the Gen­eral As­sem­bly their ini­tial rec­om­men­da­tions. The veto ses­sion ended and noth­ing at all hap­pened.

Why not? Repub­li­cans blame Democrats for show­ing zero in­ter­est in prop­erty tax re­form, which in the­ory could re­strict lo­cal gov­ern­ment spend­ing. Can’t have that.

Why won’t Democrats ‘let the peo­ple vote’ on pen­sion re­form?

Chicago and Illi­nois don’t have enough tax­pay­ers to sup­port their gov­ern­ments’ cost struc­ture. Even with about a quar­ter of state rev­enue gul­ly­wash­ing into the pen­sion sys­tem, its debt only wors­ens.

Yet Chicago and Illi­nois pols al­ways frame their sup­port for tax in­creases as if ma­jor gov­ern­ment costs are fixed, un­change­able de­mands that can­not be altered. That’s wrong, and it’s time the pols ad­mit­ted as much. Other states have re­struc­tured ma­jor cost driv­ers. Why not Illi­nois?

When he lob­bied Illi­noisans to put the Pritzker Tax on the bal­lot, the gov­er­nor told leg­is­la­tors to “let the peo­ple vote” on it. Why won’t he also let the peo­ple vote on an amend­ment that would keep in­vi­o­lable the pen­sion ben­e­fits work­ers al­ready have earned, but would re­duce ben­e­fits earned in the fu­ture?

Maybe the gov­er­nor and the other the rul­ing Democrats tell them­selves that be­cause they have to­tal con­trol of state and city gov­ern­ment, they’ve done some­thing right.

Maybe they think they’ll per­suade vot­ers ap­palled by public cor­rup­tion to ig­nore that and send those new bil­lions of dol­lars to Spring­field.

Or maybe all of that is the same self­delu­sion that tells politi­cians they’ll be in power for­ever.

For now, Illi­nois’ cor­rup­tion erup­tion risks a Demo­cratic tax fi­asco. If the Pritzker Tax has to suf­fer an em­bar­rass­ing de­feat before our rul­ing pols ad­mit they have to rein­vent gov­ern­ment here, no prob­lem. We’ll be pleased to help with pen­sion re­form and ev­ery other so­lu­tion that helps the mis­treated peo­ple of Illi­nois.

Pritzker & Co. are re­ly­ing on vot­ers to trust — trust! — that with grad­u­ated rates suck­ing more money out of peo­ple’s take-home pay, a sud­denly hon­or­able Spring­field would stew­ard tax­payer dol­lars with leg­isla­tive in­tegrity and spend­ing re­straint.

SCOTT STANTIS

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