Friday, June 29, 2007

Reforming Illinois Government Part 2

This is the second part of my essays on reforming state government and will focus on budget reforms. The first part of budgeting reforms involves a complete review of every state program, department and agency. I already gone over this some in my previous post, about reviewing program, departments and agencies for need, cost effectiveness, duplication of services or if it would be more efficient to decentralize some of them to the county, municipal or local governments. Second is to bring the states pension system into line, the first step is that the State needs to began full funding the system every year and not put off payments, when the state puts off payments it lose the interest that would be gained for each year that the payment is put off and because of this the state has to pay more money into the system in order to make up for lost interest. For example if the state puts off a billion dollar payment into the pension system for 3 years, the state would have to put 1.2 billion dollars into the system at that point to make for the lost interest. So in the long run, paying off the states pension system obligation as early as possible will save the state money in the long run. The state needs to move from a defined benefits systems to a defined a contribution plan, under the current system which is a defined benefits system the state promises to pay retirees a set amount to a defined contribution system in which the state matches, up to a certain point, each employees contributions to a retirement fund, similar to private retirement funds like 401Ks. This would benefits both the state and the employee; it would lower the cost to the state of the pensions and give the employees more control over their retirement and the certainty that the system would be funded. All new employees would be put into this system, while all existing system would stay in the existing system.

State departments and agencies should be required to list there operations and programs each year, rank them by importance and then reveal the cost of each program. This will give more information to both the voters and the members of the General Assembly about the cost of programs, there importance and will make fund decision easier and more informed.

Saturday, June 23, 2007

Reforming Illinios Government- Part One

The one thing that Governor Blagojevich and his supports is right about is that the Government of the State of Illinois needs a massive overhaul, but they are wrong about how to go about, the Governor and his backers want to expanded state spending and entitlement programs and increase the amount of taxes that the state charges and collects. This post is going to be the first of multi-post discussion on how the government of the State of Illinois can be reformed to make it more effective and less costly for the public, any comments or suggestion are welcome.

To start out with the state needs to undertake a massive review of every state agency and program, to see if they are really needed and then if they are the next question to be gone over is if multiple programs or agencies or department are performing the same of similar functions and if they are would it be more cost effective. Each Department, Agency and Program would then have it operations reviewed to evaluate how cost effective they are and make suggestion on how they can be improved. Along with this an element of cost-benefits and return on investment analysis would be performed on all new state project and state programs, while because of the nature of government and public project and programs cost-benefits and return on investment can not be the sole decider of whether or not a public project or program should be enacted like in the private economy, but it can still be very use on provide information on if the benefits of project or program out weight it costs and can be used to compare projects and program when it comes to making decision on what programs should be funded and how much funding they should get.

On the opposite end of consolidating duplicate programs into one department or agency, some programs should also be evaluated to see if it would be more cost effective to decentralized and instead of administrating them at the state or higher level if they should be administrated at the county or regional level. Or it in some cases program might be better managed and more effective if instead of the state running them if they gave grants to the county and metropolitan governments to run the programs themselves.

The Illinois Revenue and debt structure also needs a complete review, the Illinois tax system needs to be reformed and tax burden on the public reduced and the economic distortions that are caused by taxes need to be minimized. How the state funds education needs to be reviewed, many people want to break the link between property taxes and education funding, but the problem with that is currently there is relationship between property taxes, educational quality and housing values. Districts with higher property taxes tend to have better school system and the better school system tends raise housing values, by an amount about equal to what they pay in property taxes. If you break this link, it might become harder to get people to support the same level of taxes to fund schools because those people that don’t have children lose one of the benefits of having good schools.

Thursday, June 21, 2007

The Budget Impass continues

The budget stalemates continue in Springfield, today 22 of the 114 members of the State House of Representatives, lead by the Governor’s point man Jay Hoffman, sent out a letter calling on the House, Senate and Governor to negotiate on a budget and calling the budget passed by the House and Speaker Mike Madigan unaccepted and they want a large increase in spending. Speaker Madigan’s budget, while far from perfect, at least controls spending for the next year and does not increase the tax burden on the citizens and business of Illinois.

In the long run what the State of Illinois is a complete overhaul of it finances and a review of every state program to first see if the program is need or if it duplicates a service already provide by other programs. Then if the program is needed to see if it is run in the most cost effective manner, and if it is not being run in a cost effective manner, then the program should be corrected. This should also be extended to entire state agencies, to check for redundancies and efficiency

Wednesday, June 13, 2007

over time hell in Springfield

The budge impasse in Springfield continues with very little hope of the General Assembly and the Governor coming to an agreement on a new budget for the state. A big part of the problem comes from Governor Blagojevich refusal to abandon his planned spending increase and the accompanying 7 billion dollar tax increase in the form of the Gross Receipts Tax and payroll tax. This despite the House voting 107-0 against the tax increase and it not even coming for a vote in the State Senate because legislative leaders realized that it would fail and the failure of the State Senate to pass his health care plan, despite Senate President Emil Jones being a close ally of the Governor.

Along with that the Governor is continuing to push for the sale of the state lottery, while privatization of state run industries is often a good idea, the Governor has not offered a detail plan on how he would make up for the 600 million dollars a year that the state would lose in lottery revenue. Other than claiming it would be made up by investing part of the money from the lottery sale, but the amount that he would plan to invest would be required to make a return of about 10-13 percent to make up for the lost in lottery revenue and it is all put impossible to make that kind of return with out taking on some kind of risk. Along with this the lottery sale is not to popular with the members of the State General Assembly and it opposed by State House Speaker Mike Madigan. The public needs to put pressure on Governor Blagojevich to drop his tax increase and massive increase in spending on social program and accept a zero or low growth budget and start working on future budgets that would cut back on unneeded state spending and reduce the overall size of state government.

Thursday, June 7, 2007

More on the Budget

Yesterday it came out that Illinois Senate President Emil Jones has punished certain Democratic members of the Illinois State Senate for opposing the Governor’s proposed Universal Health Care programs and massive business tax that would go along with it. Senate President Emil Jones stripped South Side Chicago Senator Lou Viverito of his position on the powerful Senate Rules Committee and barred him Leadership meetings, because of his opposing the Governor’s policies. In Particular Senator Viverito opposed the Gross Receipts Tax and the addition of four new casinos to the state and slot machines in race tracks.

Governor Blagojevich also demand that the State General Assembly stay in session for 5 days a week until the budget is complete which seems fun coming for him, seeing as he barely been in Springfield during the budget debate and up until this point has made no effort to exert any kind of leadership. It is interesting to note that almost every day this week the Governor has flown back home from Springfield to Chicago each night and then flown back to Springfield each morning, on the tax payers dime of course and unlike the members of the State General Assembly, who have to pay for their hotel room and food now since the regular session is over and they have lost there 125 dollar a day expenses account, the Governor has a tax pay provided Mansion to stay in Springfield and food provide, not that he stays in the Mansion much.

Wednesday, June 6, 2007

Budget Fiasco

The Illinois State General Assembly has failed to pass a budget during it regular session and thus will be forced to go into an overtime summer session, which of course will cost the taxpayers more money. This is all due to a lack of leadership on the part of Governor Blagojevich and State Senate President Emil Jones, the Governor sprung a proposed budget that include massive new spending and 8 billion dollars in new taxes that would of severally damage the State’s economy, and then instead of sitting down with legislative leaders and talking about a budget and negotiating, when it became clear that most of the State and members of the General Assembly opposed the increase in spending and taxes, he and Senate President Emil Jones tried to shove it down the throats of the legislator and paint opponents of the new budget as being against the will of God. Predictably it failed miserable, a Governor whose party has a major in both Houses of the General Assembly failed to be able to even get his budget through, because he refused to negotiate on a budget that was clearly unacceptable to a large section of the State’s populace and Representatives.

Friday, June 1, 2007

The Governor Loses it

The Illinois Budget battle and Governor Blagojevich entered a new level of insanity today, when Governor Blagojevich reportedly threaten Democrat State Senator Mike Jacobs of East Moline when he refused to support Senate Bill 5, the Governors massive new Health Care program that the State cannot afford. The Governor reportedly offer to release 75 million dollars for Western Illinois University which is in Senators Jacobs district if he support the measure and then when he still refused, the Governor reportedly called the President of WIU and said that Senator Jacobs had cost the University a promised 14 million dollar grant and threaten to run a candidate against him next year and went into a profanity laden tirade and doubled his fist like he wanted to fight him.

Heres the link to CBS interview with Senator Jacobs,

This is just another example of the Governors inability to lead, he can not even get all of the Senators in his own party to support him. When he cant win he resorts to threats and attempts at intimidatation.