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Thursday, April 1, 2010 03:29 am

Springfield, learn from Detroit

Over the last decade Illinois has experienced remarkable growth; unfortunately it is not the type of growth that promotes prosperity: General Revenue Fund spending has grown by $10 billion, the state’s unfunded pension liability has almost tripled, our Medicaid liability has doubled and our unpaid bills total $5 billion.

Illinois is, by any definition, insolvent. Yet we have lawmakers who seem unwilling or incapable of accepting current fiscal realities. It’s as if Springfield is Detroit and our leaders are the American auto executives of the ’70s and ’80s who refused to accept the reality of the Japanese threat.

In fact, two of the best books on the American auto industry, The Reckoning by David Halberstam and The Decline and Fall of the American Automobile Industry by Brock Yates, provide haunting parallels to Illinois’ current political and economic crisis.

In a brilliant (and unfortunately relevant) chapter entitled “The Detroit Mind,” Yates describes a culture so conforming, so myopic and so isolated from the real world that it produced leaders “unresponsive to true corporate needs, much less the demands of their customers.”

The equivalent is “The Springfield Mind,” which is defined by an insatiable appetite to spend with little concern for the revenues needed to sustain its bloated mass. It is common practice to introduce spending proposals without ever voting on how to pay them.

Just as it was easy for “The Big Three” to thrive in an uncompetitive environment, the entrenched Titans of Springfield found it easy to govern in a state flush with cash. There was never concern that times might change. Halberstam could have been writing of Springfield when he noted Detroit’s inability to imagine, let alone prepare for change: “Powerful, successful, and conventional, typical of the corporate class, they believed that tomorrow would be like today because it always had been like today and because they wanted it to be like today.”

Obviously, positive change did not come fast enough to save Detroit. Its demise should serve as a paradigm for Illinois lawmakers. What’s needed is a complete reformation of the process, particularly the budget process.

If there is a silver lining to our current economic crisis, it is that it provides the opportunity to reinvent government and fundamentally change how Springfield operates. We have to institutionalize the one reform that can prevent future meltdowns of this magnitude: spending restraint.

The Taxpayer’s Fiscal Charter that I am proposing does just that. It is a realistic and responsible approach to reforming the way we do business in Springfield. I propose:
  • A two-year freeze on discretionary spending. No new programs and no expansion of existing programs for two years.
  • After the two-year freeze, there shall be no new programs and no expansion of existing programs until the state’s annual payment cycle for existing obligations is 30 days.
  • There shall be no new programs and no expansion of existing programs without a full pension payment per the 1995 plan implemented by Gov. Jim Edgar.
  • The implementation of Pay As You Go. Any new spending initiative must be accompanied by the revenue (or specified cuts) necessary to sustain the proposal.
  • No unfunded mandates to schools or other units of government. If any proposal is important enough to mandate, then it should be important enough to fund.
Let us heed the warning provided by Detroit’s downfall. Let us do more than discuss change. Let us meet this crisis head on by enacting policies which restore the public’s trust in our government and provide the foundation for the growth of our state.

State Representative Jim Watson, R-Jacksonville, has represented the 97th District in the General Assembly since December 2001 and is currently serving his fourth term in the House.

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