Governor Rauner just signed a $38.5 billion budget that contains more than $1.1 billion in spending above the current year’s budget. This is alongside a $5 billion income tax increase that lawmakers passed last summer.
That $5 billion tax increase came in handy.
Outraged voters should recall that Democrats, joined by a group of Rauner-backed Republicans, passed a $5 billion income tax hike last summer over Gov. Bruce Rauner’s veto to end a two-year budget stalemate.
Real GOP Illinois questioned whether Rauner’s veto was merely election cover for a billion-dollar tax increase Rauner needed to avoid another downgrade to Illinois’ credit rating to junk status last summer. Rauner was being branded as “Governor Junk” by Illinois media.
Wall Street Journal calls out Rauner’s ruse.
Even the Wall Street Journal saw through Rauner’s ruse in a June 2017 editorial called, “The Illinois Capitulation.”
Gov. Bruce Rauner cries uncle on taxes and economic reform. Bruce Rauner spent a chunk of his personal fortune running for Governor in 2014 to save Illinois from its tax-and-spend political class. More than two years later it looks like the former private equity star has made better investments.
On Tuesday evening the Governor with the worst job in America explained why he and his fellow Republicans have offered to raise taxes for the sake of ending a multiyear budget impasse with Democrats. He said he’ll accept a four-year increase in the flat state income tax to 4.95% from the current 3.75%, expand the sales tax and implement a cable and satellite TV tax.
This is a political defeat by any definition since Mr. Rauner campaigned on lowering the income tax to 3%, not on restoring the rate close to what it was under the last Democratic Governor. The bigger problem is that his proposed deal includes almost none of the reforms Illinois desperately needs to compete with neighboring states and repair its fiscal house. It includes nothing on right-to-work and little workers’ compensation reform. It doesn’t give local governments the collective-bargaining reforms they need and it fails to solve the state’s $130 billion or so in unfunded pension liabilities.
The Governor’s capitulation may have been triggered by the latest downgrade by Moody’s and Standard & Poor’s in the state bond rating to near junk status, with a warning that another downgrade could come this summer. Mr. Rauner doesn’t want to run for re-election next year as Governor Junk.
Tax hike cover-up.
Governor Rauner couldn’t risk being saddled with being in support of the $5 billion tax increase – not after he campaigned on “shaking up Springfield.”
Instead, a number of Republican lawmakers, backed by thousands in political contributions from Rauner, voted for the tax hike and an override of Rauner’s veto. How politically convenient.
Remember how Americans for Prosperity didn’t target Rauner’s “pet” legislators on tax hike veto override vote?
How politically disingenuous.