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Wednesday, May 16, 2007 05:37 am

Clock’s ticking

State’s Democratic leadership is at a crossroads on budget

Untitled Document For several weeks now, the Illinois General Assembly’s spring session has been a slow-motion train wreck. Those of us who work at the Statehouse are moving around in real time, watching it happen all around us and saying to ourselves, “Oh, this is gonna hurt.”
The state’s top Democrats — Gov. Rod Blagojevich, Senate President Emil Jones, and House Speaker Michael Madigan — can’t seem to get along with each other. The governor’s $7 billion gross-receipts tax has proved so politically toxic that it has virtually no support in either legislative chamber. Blagojevich has threatened to veto any alternative that increases income or sales taxes, which is making a negotiated deal almost impossible. The financial problems facing the state, however, are very real and need to be addressed. There are at least three possible outcomes to this circus of a session, although things have a way of changing fast around here:
• The three leaders finally put their animosity aside and sit down and cut a deal on a scaled-back version of the gross-receipts tax and add in such things as gaming expansion, a lottery lease, and a few other magic tricks to boost the total revenue package. • Failing a deal, Madigan sends the Senate some sort of income/sales-tax increase to boost education spending and provide property-tax relief and Jones has to decide whether he wants to abandon the governor, with whom he’s been allied all year, and then risk a summer-long fight with Blagojevich after the governor vetoes the tax hike. • Lawmakers adopt a maintenance budget. The governor warned last week that a “do-nothing” budget would result in a billion dollars in spending cuts, but this option is starting to look good to some Democratic legislators who would rather be on the anti-tax increase side of a summer argument. The governor didn’t convince many legislators that this was a bad move by warning that some high-school football teams wouldn’t be able to afford new jerseys if legislators tried to leave town without a tax hike. First of all, the vast majority of high schools don’t use taxpayer dollars for things such as jerseys (that’s why they sell candy), and, second, if that’s the worst thing that could happen, why bother raising taxes and freaking out the voters? The one thing that could prevent the General Assembly from passing a bare-bones budget and walking out the door is the electric-rate situation. Something has to be done about this, because downstaters absolutely don’t want to go home without any significant progress on rolling back Ameren’s gigantic rate hikes. To get that accomplished, Madigan will have to either back off from his demand that the Chicago-based utility ComEd be included in deep rate cuts or Jones will have to throw his close pals at ComEd (who contribute big bucks to his campaign fund and whose parent company has a contract with his stepson) over the side. It is the single issue that could prevent a total meltdown and keep everyone talking. Fear — specifically the fear of voters’ wrath — is always an overriding emotion in politics. Electric-utility rate hikes, talk of gigantic tax increases, the legislative pay raise, and other hot-button issues have energized the electorate in a highly negative way. Candidate filing begins in August this year because of the early 2008 primary, so the session will still be fresh in many minds then. Heck, it’s even possible that the spring session will still be going on when filing starts — not a good thing for those worried about running in the midterm elections next year. There’s also a slowly dawning realization at the Statehouse that voters will cast their ballots next year on whether to hold a state constitutional convention. Failure, whether it’s defined as the passage of a highly unpopular tax hike or as doing nothing to address the very serious problems facing the state, could spark passage of the referendum, and that could lead to all sorts of unexpected consequences. It’s still within the realm of possibility that cooler heads will prevail, personal grudges will be set aside, reality will sink in, or whatever, and the Democratic leaders will remember that they’re all in the same party and decide to craft a reasonable compromise. But the daunting nature of the problems, combined with the real pain that any solution (or lack thereof) would cause, requires that any détente take place pretty darned soon. As always in situations like this, don’t get your hopes up too high.
Rich Miller publishes Capitol Fax, a daily political newsletter, and thecapitolfaxblog.com.
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