Is This Worth $10 an Hour?

http://www.pantagraph.com/business/local/state-senate-may-vote-on-minimum-wage-increase/article_2d5b1ca2-93d8-11e1-a671-0019bb2963f4.html

So the idea of a statewide $10 per hour minimum wage has been discussed in the Illinois legislature for awhile now, but it appears that the Senate committee is done deliberating and ready to put it to a vote. The story is the same as any other issue that seeks to put Illinois at an even further disadvantage to its neighbors on all sides:

- Proposed by a Chicago politician (Kim Lightford, D-Maywood) seeking to score votes by espousing to help those who will be most hurt by this bill.
- Business interests oppose it.
- The rest of the state opposes.
- Neither of the latter two factors appear to matter much.

The Problem

 The money has to come from somewhere. Illinois businesses already pay some of the highest taxes around - and this goes beyond just income. Workers Comp and Unemployment Insurance are the largest two that come to mind, and guess what: they're based on taxable wages. So score a trifecta on this minimum wage hike, if approved; we business owners will not only get to pay Nic Cage more to flip burgers - we'll also get to pay more in taxes on those wages, as well!

Even more troubling is the fact that Illinois has many border communities. Should this pass, why on earth would any retailer, gas station, or service provider want to locate within the state's boundaries when they'd be required to pay the help almost $3 per hour more than they would on the other side. The guess here is this could prove to be the tipping point that decimates half of the Quad Cities, leaving just a pair behind (on the Iowa side, of course), and wipes downtrodden East St. Louis off the map entirely - or causes Illinois to officially declare it a Ward of the State.

Most bothersome of all, though, is that the people lowest on the socioeconomic ladder are going to suffer the most. While the current $8.25 an hour minimum wage is already high, it's nothing compared to what's being proposed. In order to keep someone at $10 an hour, they'd better get damn good at doing the job, and fast (a.k.a. Nic better learn how to flip one mean burger - and do it 50 times a minute), in order to justify the employer's keeping them around. Generally speaking, unskilled workers are going to have the hardest time earning the inflated wage, as the tasks they perform do not provide as much value to the customer, and thus money to the employer.

And finally the kicker: when a business has to pay 21% more for entry-level help (the amount of this wage hike), simple economics dictate that the increased cost is going to be passed on to someone else - or the business will close. Neither outcome is desirable: statewide inflation in the Consumer Price Index or a spike in unemployment as businesses consolidate and make due with as little help as possible. Even more business will be neighboring states on all sides of Illinois where sanity prevails and minimum wage hikes occur only when dictated by the federal government. And don't think these states won't actively try to recruit businesses away from Illinois even more so than they already do. Every time this state passes another asinine anti-business bill, it's as though they're providing even more ammunition for the competition.

The Solution


Stop pandering for votes and make decisions that actually dig the state out of its current mess. It's a sad testament to the depths to which Illinois government has sunk when a bill like this gets to a vote before the one seeking to repeal the scandal-plagued legislative college scholarships (still deliberately buried in committee). There are a million other more worthy initiatives to discuss - including why not to release the mentally unstable onto the streets unattended after budgets for their care have been fatally slashed - but instead these are the issues our elected officials choose to debate.

Final Word


"You can't get the right answers if you're not asking the right questions." 
~ Ryan Fiala (and probably a million others before me) ~

Normal's "Stairway to the Other Side"

http://www.pantagraph.com/news/local/government-and-politics/normal-to-build-elevated-walkway-for-train-passengers/article_6e45e854-70bb-11e1-baba-0019bb2963f4.html

Over the past two years, I've watched as a great example of federal extravagance has risen behind the restaurant I own in Uptown Normal. The new Uptown Station (pictured under construction above behind Senator Durbin) is to be a modern 21st Century transportation hub linking local and inter-urban bus, taxi, and of course high-speed rail.

Setting aside my feelings on high-speed rail (in a nutshell, why does it make sense to spend billions to get me from Chicago to St. Louis 15 minutes faster in ten years?), this project is a classic study in scope creep. In addition to the stated purpose of linking the various modes of transportation, federal, state, and local taxpayers will also be footing the bill for three floors of administrative space for the Town of Normal.

Furthermore, it was recently determined (see linked article) that pedestrians cannot be trusted to cross the tracks at street level. Thus, untold millions more are to be spent on an overpass - with elevators on both sides for disability access - to protect from themselves the masses who cannot be trusted to look both ways before crossing.

Even better: because people can no longer cross at street level, Constitution Trail (the local bike path) will now be rerouted behind my store so that bikers and runners can cross at the nearest gated crossing. Which begs the question: couldn't they have simply put in pedestrian gates at a crossing at the station? I'm not sure what these would cost, but I'd be surprised if it approached the seven figures of an overpass.

Of course, there always seems to be an old-school Simpsons parody to mirror what's going on in local and state government, and this is no exception. Please enjoy the Simpsons' infamous "Monorail" song describing the ultimate boondoggle (FYI - the episode ends with Springfield building an "Escalator to Nowhere"):



Bottom line: if all levels of government are broke and borderline insolvent, how is it that the "infrastructure" classification can be stretched to encompass so many ancillary projects?

It Costs Too Much to Let You Earn Something, But We Can Afford to Give It To You... You...

More nonsensical reasoning out of the Chicago Branch of Illinois government. I'm tired, so I'm not going to dive too deep into this. Basically, a Chicago Democrat wants to eliminate the earned right (after 7 years of service) of university employees to send their children to said school at half the normal tuition.

http://www.pantagraph.com/news/state-and-regional/illinois/house-bill-may-end-tuition-breaks-for-university-employees/article_84e39ad2-633e-11e1-8f8f-001871e3ce6c.html

The bill's sponsor, State Rep Luis Arroyo, meanwhile sees no reason to eliminate the state's perpetually scandal-plagued legislative scholarships program; legislative scholarships have been handed out to the children of political supporters, organized crime figures, and even to students who do not reside in the district represented by the legislator (as is required). When a student is given such a scholarship, it is the university that foots the bill for the lost tuition and fees. Not surprisingly, universities opposed these scholarships when it was revealed that they were not going to needy or exceptional students.

Numerous lawmakers - mostly Republicans, but including Governor Quinn - have attempted to advance legislation abolishing the legislative scholarships, but they've been thwarted repeatedly by House Speaker Madigan. Rep Arroyo has said he is disappointed that the state's universities do not speak out in favor of these scholarships, which sheds some light on the motivations behind his current legislation.

So in a nutshell, we have an Illinois legislator upset about the attack on the legislative scholarships perk by (primarily) downstate lawmakers retaliating by attempting to remove an earned privilege afforded university employees as a retention incentive. Basically, Rep Arroyo is saying, "If you won't let us give things away to people who are undeserving but who are instrumental in our political wellbeing, we are going to take a right that many of your constituents have earned as a tenure benefit".

Most amusing is the disparity in the savings the state stands to reap were the discounted tuition to be abolished. Rep Arroyo pegs the cost savings at $387 million, while the Illinois Board of Higher Education pegs it at $8 million. I suspect the truth lies somewhere in between, but consider that spread for a moment - they are $379 million apart in their assessments!

It's been documented that Illinois' accounting is among the worst of any state, with little consistency among agencies and departments, but if this is the best consensus that two different parties looking at the same program can reach, the we're doomed. It's going to be impossible to guide the state towards fiscal solvency when everyone is drawing their own map to suit their own agenda, and concrete figures appear not to exist.

More frustration to come soon, I'm sure...

The Lowered Expectations (and Generous Salaries) of Political Appointments

(Image from the long-running Mad TV skit back in the day.)

http://www.pantagraph.com/news/state-and-regional/illinois/quinn-faces-scrutiny-over-flider-appointment/article_6fafcfa2-583d-11e1-bfe1-0019bb2963f4.html

Want to earn $133,273 per year to run the Illinois Department of Agriculture? No farm experience needed.
How about $84,000 to work as an attorney in the Department of Financial & Professional Regulation?
Maybe $94,000 to sit on the Education Labor Relations Board?

If you answered "yes", follow these instructions and you'll have your pick of jobs like these:

1) Run for elected office in state government.
2) Win your election.
3) Lose your next election.
4) After you lose - but before you actually leave office - sell out your principles to someone who didn't lose, who is in a position to reward you with one of the above positions in exchange for your vote.

I think we may have found the Holy Grail of statewide largess. Each of the people holding the above positions were lame duck state legislators who voted for Governor Quinn's income tax hike last year. They have since been appointed to the above positions.

So I ask: if these positions are so important that governors are able to appoint people solely on their having cast swing votes for the tax increase, how vital a function can these positions - and in many cases the entire board or department they're joining - be in the overall operations of the state? As best I can tell, they are most useful in allowing politicians to reciprocate favors.

Sadly, no one in power is likely to ask these questions. It's easier to cut agencies' budgets across the board and delay paying the state's vendors than it is to eliminate any of the ubiquitous boards and commissions that litter Illinois government for the reasons detailed above.

I'll wrap this up by leaving you with the previous title of Bob Flider, the new director of the Illinois Department of Agriculture who will soon be raking in that $133,000+ salary:

Director of Broadband Impact for the Partnership for a Connected Illinois (yes, this non-profit is partially funded by the State of Illinois). I'm sure there's some benefit to doing studies on broadband internet, but I'm even more sure that it's not worth whatever it's costing us, and that this position was merely a holding pen for Flider until something more official-sounding opened up.

I think I want to run for office...

(Stripper) Pole Tax

(It was hard to find a clever-yet-tasteful picture of a stripper pole - this was the best I could do.)

http://www.pantagraph.com/news/state-and-regional/illinois/strip-club-tax-being-mulled/article_89e9f53a-575e-11e1-a7b0-0019bb2963f4.html

So now the state has proposed taxing heads at adult entertainment venues. As written, the law would funnel proceeds directly towards organizations that support abused women. Funny thing happens when you tie funds generated from a specific revenue source to specific expenditures - they never actually seem to go where they're supposed to. At least in Illinois they don't, anyway. Remember how Lottery funds were supposed to fund education?

At best, if this law passes - and strip club lobbyists are already chipping away at it - the additional revenue will go to support abused women. At this point, it wouldn't surprise me if the state decides to cut its annual contribution to these organizations by around the amount the strip club tax generates. So basically, the strip club tax would be yet another means by which to replenish the state's general revenue fund - as it should be.

"Sin taxes" are not unusual - just look at how heavily alcohol and tobacco are hit. Illinois has to be careful, though, to not impose taxes which put strip club owners near a state line at a significant disadvantage to those on the other side - unless the state wants to lose the revenue to its more adult-entertainment-friendly neighbors on all sides. Make the tax too burdensome, and those strip club operators who have the option of relocating outside of Illinois will do so. Given the proximity of Chicago to the Wisconsin border, it's not hard to imagine a lot of revenue crossing the border if Illinois gets too aggressive with this tax.

Ultimately, this is not a huge issue, though. The tax is expected to bring in $44 million per year for the state, but if a number of clubs close or lose business to competitors across the border, that amount will be offset to a large extent by reduced liquor tax revenues and income tax paid by Illinois club owners.

I don't really have much of an opinion on the strip club tax proposal one way or another, but how far this bill goes and what form it takes if/when it's ultimately passed will tell us a lot about how politics work in Illinois.

Flying for Free on Your Dime

The State of Illinois owns 16 aircraft, including three helicopters. Their primary purpose? Ferrying your (mostly Chicago-based - including the former governor pictured above) elected officials back and forth to Springfield. The attached article also mentions that various state departments occasionally use them for a one-day jaunt to multiple state facilities, but as a Department of Corrections official stated, "Staff would make and typically do make these visits by car or van."

Read more: http://www.pantagraph.com/news/state-and-regional/illinois/gop-lawmakers-want-state-s-air-fleet-grounded/article_5ccbe1d6-5677-11e1-9c7b-0019bb2963f4.html#ixzz1mIP2VPC9

Multiple lawmakers have proposed eliminating Illinois' airborne operations; however, all proposals are from Republicans - similar measures have not been brought before the House or Senate for consideration, so it might be awhile before these proposals see the light of day. Senate President Cullerton has openly questioned whether scuttling Illinois' air fleet would save any money; I'll openly guess that, yes, it will. The sale of the aircraft alone would bring in around $22 million.

An interesting parallel contrasting state and City of Chicago government (relevant since the power base in state government is rooted - and in many cases intertwined with their Chicago contemporaries, as illustrated by the current proposal by Mayor Emanuel to require all Illinois gun owners to register their firearms):

Ignoring the better judgment of people who knew better, then-Mayor Daley was allowed to sell off Chicago's parking meters and the Chicago Skyway in order to reap a quick windfall a few years ago; this shortsighted sale reaped around a $1 billion windfall - which the city quickly spent to pay off their debts - but will cost the city untold billions above and beyond the upfront payment they received. Somehow the sale of the parking meters and Skyway were approved without hesitation. Meanwhile, the sale of a few aircraft can't even make it to the floor for discussion; instead, the planes and helicopters continue waiting at the ready in state hangars to schlep lawmakers back and forth to Springfield - all at taxpayer expense, of course.

Medicaid for All? No Proof of IL Residency Required!

http://www.chicagotribune.com/news/politics/clout/chi-quinn-to-obama-illinois-moving-ahead-on-medicaid-fraud-crackdown-20120209,0,7704831.story

While the state is broke, Illinois politicians in the majority are on the record promoting an expansion in the state's Medicaid program to coincide with the 2014 ObamaCare phase-in. Setting aside my feelings on that, this article proves far more disturbing for two reasons:

1) The state may be providing free health care for more than 100,000 people WHO DON'T EVEN LIVE IN ILLINOIS.
2) Illinois' belated efforts to address the issue of Medicaid fraud are being blocked by the federal government in the name of easy enrollment. To paraphrase the federal government's position: making people prove they live in Illinois makes it harder for them to sign up, and we don't want to discourage anyone from joining the Medicaid rolls - regardless of whether they should be eligible.

This mess is only going to get worse as the federal government gets involved in states' administration of Medicaid. I'll keep watching as this unfolds, but don't expect any good news...