I llinois has the worst personal income growth in the Midwest since the start of
the Great Recession, according to data from the U.S. Bureau of Economic Analysis
compiled by The Pew Charitable Trusts. Yet Illinois House Speaker Mike Madigan
continues to insist that Gov. Bruce Rauner’s economic reform proposals, which
are aimed at promoting economic growth, would drive down middle-class wages and
the standard of living. Madigan has made this claim for months without offering
any evidence to justify it. That’s because Madigan’s claim is not credible. And
Madigan’s own proposal – an income-tax hike – is itself the most direct way for
government to reduce the wages and standard of living for middle-class
Illinoisans.
In a July interview at the Democratic National Convention, Madigan claimed that
his political longevity benefits the state because it allows him to thwart
Rauner’s reform agenda. Madigan repeated his tired claim that Rauner’s agenda
would reduce wages and the standard of living.
In terms of the benefits of longevity, why I think it’s pretty clear where my
longevity has put me in a position that I can successfully resist the extremism
of Rauner, provide a check against the extreme ideas that he wants to bring into
government. The ideas of reducing wages and the standard of living, hurting the
vulnerable of our society.
Madigan does not seem to understand that investment, jobs growth and increased
productivity are the primary drivers of rising wages. In fact, economic research
makes clear that Madigan’s proposal – a tax hike – would harm the state by
reducing investment, thereby sapping the state’s economic growth. Tax hikes
reduce the savings needed for both new investment and for family consumption.
And Illinois’ high-tax, regulation-heavy economy makes the state less attractive
for businesses looking to invest in new machinery, facilities and equipment
because the cost of operating in Illinois drives down businesses’ return on
investment.
[to top of second column] |
 When businesses choose to invest in other states instead of
Illinois, Illinoisans lose opportunities for new investment, more
jobs and increased productivity – the critical factors that drive up
middle-class wages. And the intransigence on spending and economic
reform displayed by Illinois politicians – led by Madigan – is the
very reason Illinois is losing out on these investments. Without
businesses that want to operate in the state, compete for workers,
and make productivity-enhancing investments, there is little that
can be done to drive up wages and the standard of living.
Madigan never presents any contrary evidence about driving up wage
growth because he has none. He simply resists reforms that would
help the state because they don’t enhance his political power.
Ironically, Madigan’s discussion of Rauner ends with Madigan’s
suggestion that Rauner follow the path of hundreds of thousands of
Illinoisans and leave for a state that embraces economic growth.
These are all extreme ideas. They have no place in a state like
Illinois. There may be other states in the nation where they would
welcome things like this. Rauner ought to go there.
Illinoisans ditching the Land of Lincoln for other states is a
problem Madigan studiously ignores because it is a powerful
indictment of his tenure. It is also one of the factors that led to
Rauner’s election. Rather than goading Rauner to depart for another
state, Madigan should study why a record number of working-age
Illinoisans are already moving out every year. The speaker would
find that greater economic freedom and more economic opportunities
attract Illinoisans to other states where they find better wages and
a higher standard of living.
Click here to respond to the editor about this article
 
|
