Why The So-Called “Fair Tax” Is Wrong For Illinois (For Now)

Oh, the irony!

If, back in 2008 when it was on the ballot, the call for an Illinois constitutional convention had passed, if we hadn’t been snookered by our betters who told us to vote no, if we Illinois voters had understood that the state constitution had fundamental flaws — including the pension clause, the provisions granting the House Speaker such substantial powers, the narrow definition of topics eligible for an amendment by means of petition-gathering, and more — then I’ll admit readily that I would have found it entirely acceptable to remove the clause forbidding graduated tax rates in the personal income tax as part of an overhaul.  Why should that be in the constitution, rather than simply left for legislators to decide, based on the conditions any any given time?

But as it is, I cannot support the proposed amendment, because the elected officials who are and will be making decisions about tax rates have not left the world of corrupt and broken politics in which a graduated income tax is a recipe for failure.

A simple look at the new tax structure itself makes its flaws apparent.  In the first place, there is a significant marriage penalty, as the tax brackets for the lowest four rates are the same for singles and couples.  Bizarrely, it is only at the higher income levels that joint filers have a higher bracket level than single filers.  What’s more, when a single taxpayer earns more than $750,000 or a couple earns more than $1,000,000, all of their income is taxed at the highest rate.  In addition, the tax brackets are not adjusted for inflation or wage increases over time, so that over time, more and more Illinoisans will be subject to the higher rates.  These three components of the new tax rates are completely out of line with the way the federal government, any state, or any sensible entity, taxes its residents.  In fact, after the new legislation was proposed, I kept expecting these provisions to be revised, but that’s exactly how the bill was passed.

But beyond that, the advertising around the new amendment promises Illinoisans that they can have it all:  all the state services they’re used to, improved education funding, property tax reductions, as well as a tax cut for themselves, paid for by the wealthy.  This is corrosive to our civil society — and I’m not just speaking of the risk of businesses leaving the state due to the impact on small businesses filing as individuals as well as the corporate tax hike, but of the “us against them” mindset that the tax promotes.

The explanation on the ballot further misleads; as watchdog group Wirepoints observed, the ballot language misleads voters into believing that the constitutional change will only raise taxes of high, not middle-earner taxpayers.  It falsely states that the method of taxing higher earners more is how “a majority of states do it” (in reality, it is more common for states to use their graduated tax rates to protect lower earners, while taxing middle- and high earners at the same rate).  And it omits the change that removes a provision that there may be only one income tax, leaving open the possibility of adding a tax on retirement income by using a lower tax rate to make it more palatable, for example.

And at the same time, although thankfully we can keep adding to the tally of “years since a governor was sent to jail,” the state of Illinois and its elected officials have not truly committed to changing the way the state operates.  Pritzker gives speeches professing “shared sacrifice” but in the end promises Illinoisans that they can have it all, paid for by increasing gambling, pot use, and taxes on the wealthy, and even still, despite massive budget holes facing the state, has made no cuts to payroll.  A pension amendment is rejected out of hand.  Ethics reforms stall.  Madigan stays in power seemingly immune to scandals surrounding him, defended rather than being called to account by his party.

It is not sufficient merely to profess that Illinois is, or will be well-governed.  To deserve its citizens’ trust and be given this new taxing power, the legislature must prove it has reformed.  And it has failed to do so.

https://media.defense.gov/2019/Feb/12/2002088973/-1/-1/0/181206-A-UM169-0001.JPG; https://www.dover.af.mil/News/Article/1755127/what-you-should-know-about-filing-2018-taxes/ (public domain/US gov)

Why JB Pritzker is a Prosperity Gospel Preacher

https://commons.wikimedia.org/wiki/File:Joel_Osteen_Preaching_At_Lakewood_Church.jpg; Justin Brackett [CC BY-SA (https://creativecommons.org/licenses/by-sa/4.0)]
Joel Osteen may not be a household name, but he’s a familiar face among the inspirational books at your local Target.  Literally – his books, with titles such as “Your Best Life Now: 7 Steps to Living at Your Full Potential” and “Next Level Thinking: 10 Powerful Thoughts for a Successful and Abundant Life,” feature his big smile on the front cover.  He’s one of those preachers about whom it’s best to say that he identifies as Christian, because the message that he preaches, given the name Prosperity Gospel, doesn’t look all too much like actual Christian doctrine.  Instead, he tells his audience, in his 56,000-seat converted-stadium Lakewood Church, and in his books, that they are made for greatness if only they “Name and Claim” the material prosperity that is the destiny of all who have enough faith.

It’s the sort of belief that’s routinely mocked by the satire site The Babylon Bee, with such articles as “Report: Imprisoned Chinese Christians Maintaining Faith By Secretly Reading Smuggled, Tattered Copy Of ‘Your Best Life Now’“, “Joel Osteen Targets Millennials With New Book: ‘You Can Even!’“, and the Snopes fact-checked classic “Joel Osteen Sails Luxury Yacht Through Flooded Houston To Pass Out Copies Of ‘Your Best Life Now’,” which “reports” that:

Osteen had his on-call yacht captain steer the large vessel through the flooded streets of the city, pulling up to survivors stranded on their roofs and on the roof of their cars as the prosperity gospel preacher smiled, waved, and threw out signed editions of the bestselling positive thinking book.

“Believe and declare you are coming into a shift!” Osteen yelled through a bullhorn, according to reports. “God wants His best for you! Enlarge your vision, develop a healthy self image, and choose to be happy!”

“When you think positive, excellent thoughts, you will be propelled toward greatness!” he called out to one family floating on a raft on a freeway-turned-river, whose earthly possessions had been entirely destroyed the previous day.

And when I listen to Illinois Gov. JB Pritzker, in his speeches and interviews, I hear a lot of Prosperity Gospel hucksterism.  Oh, sure, he doesn’t want us to send him “seed money,” but he wants us to believe — to believe that all that ails the state of Illinois is negative thinking, and what’s needed to fix the state is to name and claim our future prosperity by believing that the state is doing well and destined for more business investment.

In an interview at the Economic Club of Chicago back in November, he said,

We spent years where the leader of the state and allies were spending hundreds of millions of dollars to tell all of us how bad the state is. . . . The narrative we need to change is that we can’t solve these problems. . . . The reality is these are hard . . . . we need to focus on . . . pensions, property taxes, balancing the budget, paying down our bill backlog, and growing jobs in the state. . . . But the narrative about Illinois is we are a state on the rise.That we’ve had our challenges, that’s for sure. That we were going in the wrong direction, but we are turning the ship in the right direction, and we are powering ourselves forward.”

(This is my transcription paired with an additional citation from Wirepoints.)

And in his State of the State speech earlier this week, Pritzker said,

Those who would shout doom and gloom might be loud – using social media bots and paid hacks to advance their false notions – but they are not many. You see, we’re wresting the public conversation in Illinois back from people concerned with one thing and one thing only — predicting total disaster, spending hundreds of millions of dollars promoting it, and then doing everything in their power to make it happen.

I’m here to tell the carnival barkers, the doomsayers, the paid professional critics – the State of our State is growing stronger each day.

Is Illinois’ economic well-being and financial state improving?  It’s still second from the bottom in “taxpayer burden” according to the watchdog group Truth in Accounting.  Chicago is likewise second-worst among the 75 largest cities.  Among the 10 largest cities, Chicago is worst in terms of total debt (city, county, and state) taxpayers face — and I presume that if they’d had the resources for a more extensive analysis, Chicago would still be at the bottom.  Watchdog group Wirepoints compiled a long list of unpleasant narratives, including a worst-in-the-nation credit rating, one notch above junk, falling home prices, and rankings of news outlets such as U.S. News and World Report (worst state in the nation for fiscal stability), Kiplinger (least tax-friendly), and WalletHub (highest tax burden).

Who are the hucksters and carnival barkers?  It’s Pritzker himself who fits the bill, promising voters that a graduated income tax would mean forgoing shared sacrifice in favor of a tax cut for nearly everyone and would save the day not only by filling budget holes but by generating extra cash for property tax reductions, and believing that sufficient levels of optimism will lead corporations to eagerly locate new offices and factories in the state.

And as for me — well, if you can tell me how to turn my frustration at pension debt into the business of being a paid hack, I’m all ears.