Ignore Rauner: The State of the State is Bankrupt

Written by John Biver

As one of those people who rarely watch our governor’s State of the State Address, Bruce Rauner’s speech on Wednesday reminded me why most people don’t bother. Much like his performance before the MUST-WATCH Chicago Tribune editorial board meeting, it was embarrassing. It was weak. It was silly. And it was predictable.

Illinois Republican voters can’t say they weren’t warned about Rauner. During the 2014 election cycle Doug Ibendahl, Laurie Higgins, and I wrote plenty of articles explaining why electing him was a mistake. One article was titled, “Bruce Rauner and the Destruction of the Illinois Republican Party.”

After three years of Rauner’s governorship, headlines are common about Illinois’ pension debt, unpaid bills, unbalanced budgets, decreasing credit rating, and one of my all-time favorites — the one billion dollars in penalties and interest accrued by our state’s tardy payments.

The theme, if that’s what it can be called, of Rauner’s State of the State was that Illinois is in a state of “readiness.” For what? Well, under his tenure our state is finally going to do something about corruption. Isn’t that exciting? And we’re going to do something about those nasty property taxes. Great! Oh, and somehow, despite our high taxes, Illinois is ready to experience economic growth.

Chances are corruption, and the corrupt property tax system, will remain unchanged. What will happen is that because of President Donald Trump’s economic boom, Illinois may see some growth even as our population continues to shrink. What is certain is that whatever growth occurs here won’t change our state’s bottom line: Illinois is insolvent and its fiscal condition is unfixable without declaring bankruptcy.

The federal statutes that currently govern bankruptcy do not allow for states to go belly up. Local governmental units can, and a bunch of them have chosen to face reality and make use of the bankruptcy courts to get their act together.

Watch for that to change during Trump’s tenure assuming the GOP continues to hold both the U.S. House and U.S. Senate. The Republicans holding onto both houses of Congress is a safe assumption since the tax reform legislation that passed last year will continue to raise incomes, increase opportunity, and make the Democratic Party look ridiculous.

Bankruptcy laws have existed for millennia, and for good reason. Tragedies happen, and people make mistakes. There is a point that arrives where common sense and human compassion calls for a reset. Even for fools. And Illinois’ state and local governments have been run by fools.

It is not easy to avoid words like “stupid” or “corrupt” when writing about just one area of our state’s budget: our government employee pension systems. The fact that roughly twenty-five percent of our budget goes to pay retiree pensions ranks among the dumbest things ever done by people claiming to be able to do math.

As I have written previously, all the taxpayer funded pension systems need to be separated from taxpayers and shut down. They cannot be fixed — the arithmetic cannot be made to work. As for the state constitution’s provision protecting those benefits, it’s time adults realized that state constitutions do not exist to make miracles happen.

Congress should act. Illinois should file bankruptcy. And the courts should guide our state into paying legitimate debts such as unpaid bills to social and other service providers. The rest of the debts need to go bye bye so Illinois can experience what bankruptcy laws allow for: a fresh start.

Freed from corrupt government employee pension systems, our state can pay down honest debt and eventually lower taxes and begin to seriously compete for businesses and talented individuals with other states. If this is accomplished during the Trump boom years, our state’s fortunes can turn around rather quickly.

Of course, none of this will happen under Rauner, the fantasy-toting Democrats running for governor, or the current General Assembly leadership. The first step in the right direction is to nominate and then elect Jeanne Ives as Illinois’ first female governor.

Among the current “leaders,” only Ives has the kind of courage needed to describe the real state of our state. Illinois is in a state of readiness, as Rauner has pointed out, but for bankruptcy and a fresh start.

For more on the topic of states declaring bankruptcy, click here, For the prospects of Illinois leading the way, click here, here and here.

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