In previous posts, I've discussed the dire financial situation in many of our states. I also pointed out the four states that are in the most trouble, namely California, Illinois, New York, and New Jersey. Well yesterday, one of those states took a drastic step to close their monumental budget gap. In Illinois, state lawmakers worked overnight to pass a 66% increase in the rate of personal income tax, from 3% to 5%. They also increased the corporate tax from 4.8% to 7%. They worked to push it through as the lame duck session expires, since Republican gains in the legislature would have made it impossible to pass. In the end, the tax hikes passed by the bare minimum majorities of 60-57 in the House and 30-29 in the Senate.
What a disgrace. For the life of me, I cannot begin to comprehend what these politicians were thinking. Did they not get the message from voters on 11/2/10? Are they even listening? Essentially they're telling the taxpayers, "Due to the way we've mismanaged and overspent our funds over the past several years, we now have to take more of your money." They're treating their constituents like pack animals, putting the burden on their backs and stacking it higher and higher to see just how much they can carry. It is absolutely disgusting.
In this economy, what do they think will happen as a result of these tax increases? People are already spending less, so will they spend more now that they'll be paying $1,666 in taxes for every $1,000 they paid last year? Will people want to move to Illinois now that the tax rate has increased, or do you think more will leave? Will businesses be flocking there to pay a 7% tax rate, or will more businesses consider moving out of state? Of those businesses that stay, will they hire more workers or hire less? The answers to these questions are so obvious that I need not address them.
What's even more disturbing is that the legislature claimed that the tax cuts are only temporary. Sure, and maybe the Cubs will win the World Series this year too. Please. That statement is as disingenuous as they come. Everybody in the Illinois Statehouse knows that these tax hikes will become permanent eventually.
As House Minority Leader Tom Cross, R-Oswego, said, "It's a cruel hoax to play on citizens to say this is temporary."
Illinois Governor Pat Quinn actually defended the massive tax increase and vowed to sign them into law as soon as they reach his desk. He is in complete denial, dismissing the notion that the increase in corporate taxes will decimate businesses. Like his fellow Democrats in the legislature, he feels entitled to take more money from the people he serves to solve the state's budget woes. Just another tax and spend liberal who believes that the money we make belongs to them, not to us.
Governor Chris Christie of New Jersey has been a polarizing figure during his first year in office, but I would pose a question to those who are so against his determination to balance the budget by cutting spending. Would you really prefer to live in a state that doesn't think twice about raising the income tax level by 66%? Do you want to live in a state that drives out businesses and decimates their hiring practices by increasing the corporate tax from 4.8% to 7%? I don't see how anyone can answer "yes" to either of these questions. But if you did, then do yourself a favor. Move to Illinois, because such massive tax increases will not be instituted under Christie's watch.
I'm very interested to see what comes of the tax hikes in Illinois. I'll be following the situation closely to see if businesses leave, if hiring goes down, if unemployment goes up, etc. My prediction is that the Democrats will rue the day they pulled this political stunt in the dead of night, ramming it through the lame duck session before more Republicans could take office. They'll live to regret it, and pay the ultimate price for ignoring the message of the voters. They say that the only two sure things in life are death and taxes. But come next election, the Democrats in Illinois will find out that those two things are one and the same.
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