“Our Rendezvous with Reality Has Arrived.” Welcome to the Party, Governor

Courtesy of The Illinois Chamber of Commerce’s Government Affairs Report
Friday, February 24, 2012

The Governor finally seemed to come to grips and recognize the two elephants in the room that keep putting the state further into debt: Medicaid and pensions. We’ve all been well aware for some time now that Medicaid and the pension systems are crippling the state’s budget and it’s about time the governor started acknowledging that and with the above quote in his speech it seems he finally has. In his budget address on Wednesday, the Governor called for trimming Medicaid spending by $2.7 billion, restructuring the state’s pension systems, increasing education funding and closing/consolidating 67 state facilities. Noticeably absent was that there was no mention of how to restructure the pension systems. House Republican Leader Tom Cross mentioned in his reaction to the speech that everybody knows about the issues; it’s time to do more than just talk about it.

Even with the Governor’s cuts, his budget proposals will only pay down less than 2% of the backlog of bills; only $162 million. Comptroller Judy Baar Topinka’s number for the state’s unpaid bills is around $8.5 billion. At the rate of paying off less than 2% every year; it would take around 50 years to pay it all off. That does not account for the 12% yearly interest rate.

To read the full post, visit the Illinois Chamber’s site here.

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