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The Manhattan Institute’s Steve Malanga discusses why Illinois continues to increase taxes instead of taking a federal bailout.
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Steve lined up from a on -- and company we have a heated debate.
With an Illinois budget spokeswoman Kelly Kraft.
Two main points from that interview focused Illinois and the federal but I don't want elicit -- that's an uncommon.
-- Illinois has no intention of seeking a federal bailout we never have never will -- Illinois is solving its old problem.
OK I didn't hear about it and it's not just at it and it the government went has never sort of federal bailout never has been never will that's what -- said.
Correct.
So far yet but you know -- question I -- is who's gonna bail out -- Illinois taxpayers they're the ones who need to bail out.
The state raised taxes.
Seven billion dollars last January in order to balance their budget seven million dollars they did nothing to cut spending.
The entire seven billion dollars has been eaten up by things like rising pension costs -- in the same hole hole that they were in a year ago.
Armed they -- eight billion dollar it.
To be actually precise and accurate governor Quinn has not asked for no federal but I don't think I'm not arsenic in the stimulus like everybody else but they have not because we're not Michael -- a -- -- bailout but perhaps inaccurately she is that the governor has not said.
Hey mister Obama on -- federal money he's not said that's explicitly.
You have I don't believe it happens.
I'm not quite sure what you mean he and a bunch of other governors have had said for instance that they want better funding of Medicaid and things like that but he's never specifically said for instance.
Our.
Pension system is so underfunded that we need to -- found on development -- -- like that.
Okay next point here's what ms.
Kraft had decided about governor Quinn's record on the budget -- -- -- -- -- Allen really is doing its best to address its deficit that we have when governor Quinn took office we had a deficit of about thirteen billion dollars.
That is down significantly under governor Quinn's leadership we've reduced spending more than any governor in recent history and -- Yes I did hear that I'm what do you make a backpack.
Well a couple things first of all one of that one of the main reasons the deficit is down is merely because kinds of slowly starting to get better for everybody out there.
She talks about reducing discretionary spending that's what the governor -- on reducing discretionary spending.
Well of course pensions is not part of discretionary spending.
That's the thing that they refuse to deal with and any substantial way so the fact of the matter is that Illinois is in my opinion one of the two or three most irresponsible states right now.
They have a budget.
That if you actually looked at their revenues.
And if you look at their expenses they don't meet any time in the future by the way they're planning to go like this.
OK so it's not what we would call structurally sound budget they don't cross anywhere.
It it if they don't do reform then they're just gonna continue to limp along like by -- may Asia is Illinois in -- shape financially than all any of the -- well.
In addition -- fact -- had -- huge budget deficits but 08 billion dollars so in other words what they've done is they've they've.
They have essentially.
A balanced their previous budgets by not paying their vendor -- -- is eight billion in the red -- talking about sixty total well if you -- actually because there's other other kinds of things that they're not counting as part of what they're not paying their vendors what we just had -- -- can have -- -- cigarette right they're not paying their doctors and patients at how exactly they're not think that are so so essentially what -- doing other states have done things like -- cut spending and maybe they've raise revenues what that what they've done in Illinois.
They haven't contribute to the pension funds except -- -- money OK and they haven't paid their vendors if you add up what they should be putting in their pension funds every year several billion dollars.
And the the it's billion I mean.
Vendors that they're not paying.
They -- need about 45 maybe six billion dollars a year in either additional revenues or additional cuts that -- have a balanced budget and to Begin even making a dent in all the money they -- and all their unfunded liabilities so there just so far behind right now.
-- -- -- -- lined up from the Manhattan institute thanks for joining us -- we might playing with us thank you.
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