Saturday, April 5, 2014

Double the taxes to be raised? Or double headache for pols on pensions?

So much for the idea of the General Assembly giving a quickie approval to a measure required for Chicago city government to be able to resolve its own pension-funding problems.

EMANUEL: Wants state support for tax hike
The Legislature adjourned Friday morning without the Illinois House of Representatives taking up the issue. Republicans remain adamantly opposed to the solution desired by Mayor Rahm Emanuel, and I’m also sure there are Democrats who don’t think much of the solution put forth.

ALTHOUGH I SUSPECT if they don’t go along with it, they’re going to learn just how harsh the Wrath of Rahm can be. Plus, they’ll get the blame for the city’s pension problems becoming an overwhelming burden on municipal government.

This coming after many of them took the hard vote for a state pension funding reform mechanism that is so despised by organized labor that many unions did their best to try to defeat its more vulnerable political supporters at the ballot box.

This is going to get ugly. Nobody is going to wind up pleased with whatever solution ultimately gets agreed upon. Although as I sit here writing this commentary, I don’t have a clue what that solution will wind up being.

Now as desired by city officials, they want to reduce a $20 billion debt due to pension obligations by about half during the next four decades (pensions always are long-term issues, which is what makes them easy for political people to think they can put them off to a later date).

BUT THE BURDEN grows and grows, and eventually, political people get pressured to act for fear the debt will devour everything else in government.

QUINN: Unsure if he can help
That ultimately is what nudged the General Assembly to act on the state pension program. It is what is forcing them to deal with the city’s problem.

Which Emanuel has proposed paying down with increased property tax revenues. Some $750 million more to be raised during the next five years. Purely a local issue. Except that because it involves pensions, the state Legislature has to review it.

The same Republicans who always rant and rage about “tax” as though it were an obscenity don’t want to get the blame for supporting a property tax hike for Chicago residents. Just think of what happens if Chicago voters get it into their heads that “Republicans from Springfield” was more of a dirty phrase than usual.

DURKIN: Doesn't want blame for Chgo. hike
IT WOULD BE just the kind of thing to get them to turn out en masse on Nov. 4 and vote against every GOPer possible – including the gubernatorial bid of Bruce Rauner. Only Gov. Pat Quinn would like that idea; as Rauner is counting on Chicago voter apathy (particularly amongst African-American voters) to bolster his chances of winning.

Except that maybe he won’t.

Because Democrats in Springfield, including the city’s legislative delegation, also are being asked to back this increase, along with the one he’s already asked for in terms of making permanent an income tax increase from a couple of years ago that was only supposed to be temporary!

He’s already got the ire of the ideologues because of that, although we can dismiss that because it comes from people who are going to say Pat Quinn is vile and evil no matter what he says or does.

RAUNER: Could he be hurt too?
BUT ASKING FOR an income tax hike AND a property tax increase in Chicago? The Chicago Tribune caught Quinn engaging in some double-talk while refusing to say if he supports Emanuel’s pension solution but also saying he’d like lower property taxes.

It’s not likely he, or anyone, can have both. Although Quinn was accurate in telling that newspaper that the pension solution may wind up having to be altered, although Illinois House Minority Leader James Durkin, R-Western Springs, suggested to the Chicago Sun-Times some changes that the labor unions are saying would kill the whole deal.

And the only thing that might be worse for political people is if no deal gets approved for pension funding.

Soon to be popular w/ Statehouse scene?
Just think of how much ridicule and abuse the General Assembly was submitted to in recent years when they were unable to reach any kind of pension funding shortfall agreement.
I’M SURE THE City Council does not want to be in that same situation, and is eager for the Legislature to back something on their behalf.

And the only point I’m willing to make on this particular date is that whatever solution ultimately gets approved, I’m sure there will be several lawsuits challenging it in the courts – just like all the legal actions now being taken against Illinois government on the pension question.

Where’s the Tylenol bottle? Oh that’s right, there’s a rush on the headache-relief pills from all those legislators trying to pick the lesser of financial evils!


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