Mulvihill: Illinois needs tax reform more than pension reform
By Jerry Mulvihill January 24, 2014 7:06PM
Jerry Mulvihill, of Alsip, is a public school teacher, former school board member, public school activist and father of two students in Southland public schools.
Updated: February 27, 2014 6:14AM
In his Dec. 4 column, Phil Kadner pointed out the few Southland Democrats who broke ranks with their party line and voted against the pension reform legislation in Springfield. These legislators should be recognized for voting to protect the benefits that their constituents paid for and earned over many years.
However, some Democratic lawmakers who represent the Southland failed to do the same, such as state Reps. Monique Davis, Fran Hurley, Kelly Burke and state Sens. Emil Jones III and Bill Cunningham. Their districts, largely in Chicago and the inner-ring suburbs, collectively have more than 20,000 constituents who will be negatively impacted by this legislation, according to data reported by the state pension systems.
The phone calls, letters, emails and office visits by current and retired constituents — pleading with these lawmakers to vote against pension reform and uphold a constitutionally protected benefit — proved irrelevant.
The pension fight in Illinois is of significance beyond the teachers, university employees, teachers, police officers, firefighters and state workers in the pension systems. It’s part of the nationwide assault on working people’s living conditions. It’s an attack on the middle class and, in the eyes of many, a social justice issue.
And make no mistake. As a public schoolteacher, I can tell you it’s also a central part of the corporate-driven education reform agenda of wealthy special interests. The degree to which this attack is being supported by some local Democrats is startling to many of us whom they represent.
Cunningham told Kadner shortly after his vote for the pension bill that “doing nothing was not a viable option. It potentially results in the pension system going bankrupt. Our goal was to come up with legislation that is equitable. I almost said ‘fair,’ but fair is not a word I want to use in describing this.”
Gutting the pension benefits of state employees was not the only answer. Cunningham, D-Chicago, was fully aware of this, having been a member with Burke, D-Evergreen Park, of a special legislative committee on the pension issue.
Ralph Martire, president of the Center for Tax and Budget Accountability (CTBA), testified before the committee regarding the root causes of Illinois’ pension shortfall, and he outlined long-term options to address the problem and offered insight on how to fix it.
A CTBA analysis exposes the facts about Illinois’ economy that have ultimately led to the state’s poor fiscal condition. Income tax breaks for the state’s largest corporations and a personal income tax in which Illinois’ wealthiest citizens pay the same rate as a minimum-wage worker were identified as the biggest culprits.
In its report to the committee, the CTBA stated, “Flawed tax policy that generates insufficient revenue has been a primary driver of the state’s fiscal problems that led to the unfunded pension liability that currently exists.”
Decades of insufficient revenue have resulted in a school funding system so overreliant on the property tax that students’ quality of education is mostly dependent on their ZIP code. This has also forced essential state services to be cut or eliminated, leaving many of Illinois’ neediest citizens out in the cold.
The ultimate travesty of the pension reform bill is that it fails unilaterally to address the state’s revenue deficiencies and support a tax structure that is fair for businesses and citizens alike.
While unions and organizations representing state employees are challenging the constitutionality of the reform law, corporate-backed groups contend that the pension reform bill does not go far enough. They plan to pressure the Legislature this year to pass deeper reductions in state pension benefits.
Illinois’ structural budget deficit will persist without local Democratic legislators being willing to push for more revenue via tax reform. Meanwhile, lawmakers will consider this spring similar pension givebacks for Chicago Public Schools teachers and city workers.
The status quo in the Illinois Democratic Party of adhering to the orders of the party bosses is becoming more than the Southland’s middle class can take. The time for local Democrats to step up and lead the state toward genuine economic sustainability is long overdue.
Jerry Mulvihill, of Alsip, is a public school teacher, a former school board member, a public school activist and the father of two students in Southland public schools.