Kadner: If millionaires are happy, others are not
By Phil Kadner firstname.lastname@example.org March 21, 2014 8:02PM
House Speaker Michael Madigan (right), D-Chicago, has proposed a 3 percent tax surcharge on incomes of more than $1 million. | AP photo
Updated: April 24, 2014 6:40AM
Here’s what Illinois House Speaker Michael Madigan said when asked if millionaires would leave Illinois if the state passed a 3 percent surcharge on incomes of more than $1 million a year:
“If they’re in Illinois today, they are probably so much in love with Illinois that they’re not going to leave,” Madigan said.
“And they’ll be grateful for the opportunity to support lower education.”
He didn’t laugh. Didn’t even crack a smile.
As we all know, millionaires have options. They don’t have to leave Illinois to avoid an income tax surcharge.
They merely have to buy a home in Florida (which has no state income tax) and claim it as their legal residence.
Last week, Madigan, D-Chicago, proposed putting a constitutional amendment on the Nov. 4 ballot that would create that 3 percent surcharge to raise money for education.
He claims there are 13,675 millionaires in Illinois and that the surcharge would raise $1 billion. That money would be awarded to schools on a per-student basis, about $550 per student, Madigan contends.
When it comes to education funding, I don’t trust any politician in Illinois.
Given the history of the Illinois Lottery, a bait-and-switch scheme that was promoted for years as providing more money for public education, I shook my head at Madigan’s chutzpah.
On the other hand, with the “temporary” income tax hike due to start rolling back in January, the state is going to lose billions of dollar in revenue. And Illinois already is billions of dollars behind in paying its bills and funding state workers’ pensions.
If nothing is done, there are going to have to be massive cuts in state programs, including education.
On Friday, the state schools superintendent testified at a Senate committee hearing in Springfield that as many as 13,500 teachers could be laid off in Illinois.
There would be across-the-board cuts of 20 percent in human services and other state agencies. An estimated 25,000 people with developmental disabilities would lose government services.
Republicans claim the numbers are just scare tactics. But we all know this state doesn’t have enough money to keep operating as it has in the past.
Yet, even when the times were good, Illinois failed its public school students.
For 20 years now, I’ve written about the problems with the way this state funds education.
On average, property owners pay 67 percent of the cost of public education in Illinois through the property tax. No other state in the nation has placed such a huge burden on homeowners and businesses.
The result is that Illinois ranks dead last in the nation in the percentage of public schools’ costs that it picks up.
That forces elderly people on fixed incomes to sell their homes and move out of state. It causes young people starting families to look to Indiana when buying their first home. It often means the difference between profit and loss for a small-business owner.
All of this is well known to the politicians in Springfield and has been for more than 30 years. In all that time, Republicans and Democrats just ignored the problem.
During his news conference on the millionaire tax, Madigan said that in his 44 years in the Legislature he has voted “yes” on every education tax proposal that came before the House.
That may be true. But when former state Sen. James Meeks, D-Chicago, passed a bill in the Senate to raise the state income tax and reduce the property tax, Madigan made sure it wasn’t called for a vote in the House.
Meeks, pastor of a huge congregation at Salem Baptist Church in Chicago, is backing Republican Bruce Rauner for governor.
By the way, Illinois also ranks last in the nation in mental health funding and spending on the disabled.
Rauner said he will cut taxes, and that will create new jobs and increase revenue for the state. That sounds good, but how long would that take? It sure isn’t going to happen in a year or two.
And there’s reason to doubt he can do much of anything because, if elected, he will face Democratic majorities in the Senate and House.
As for the proposed constitutional amendment to allow the higher income tax on the wealthy, there’s no guarantee that would pass. The Nov. 4 ballot could be full of constitutional amendments.
Rauner’s financing a scheme to put a term-limit referendum on the ballot.
A coalition of groups under the banner of “Yes for Independent Maps” is backing an effort to limit the gerrymandering of legislative districts, which would diminish the power of political parties.
There’s also talk about putting a constitutional referendum on the ballot for a graduated income tax.
Each of those proposals is worthy of serious discussion. None is likely to solve the problems of Illinois government.
Incumbent politicians like to say that the problems, such as the failure to make required payments into the pension systems over decades, are not their fault.
People running for public office claim that they can solve all the problems created by decades of mismanagement but never really explain how they’re going to do that.
Instead, they use public schoolchildren as political pawns, refusing to accept any responsibility for the problems that exist. In other words, they never act like adults.
Taxing every dollar earned over $1 million to raise money for education may sound reasonable to some people. But it sure smacks of desperation to me.
Most of the people I’ve talked with in this state are fed up with corruption, government ineptitude and tax increases.
The first two are the reasons why the third is necessary.