Chicago school board to teachers: take it or leave it

Chicago Public Schools, the nation’s third largest, has been grappling like the rest of the U.S. in how, and when, to reopen schools, Facing the usual discussions of transmission and safety, the school board has been locked in a series of discussions with the Chicago Teachers Union, and the frustration in reaching an agreement to protect the safety of teachers, and their families has reached a stalemate with the school officials over how this can be done.

While Superintendent Dr. Janice Jackson has expressed her desire to reopen the schools from K through 12; after some pre-K and special education students recently returned to the classrooms, no more than 3,000 showed up on any given day, reported The Chicago Sun-Times; fearing faulty ventilation, and less than adequate sanitation, problems that have beset many schools before the Covid pandemic, and now continues, worsening a condition and creating a roadblock in negotiations.

Jan. 25 was the date that general K-8 students are expected to resume in person instruction, but as we've seen the possibility that teachers will be in their classrooms seems remote at best. and over the weekend, beginning on Friday, according to the Chicago Sun-Times, "Chicago Teachers Union members narrowly voted to defy Chicago Public Schools’ reopening plans and continue working from home Monday because of health and safety concerns."

Dr. Janice Jackson

While there is scant evidence of child to child transmission, there is ample evidence of child to adult transmission; and, especially for those that have pre existing health conditions, there are also many parents not confident with school safety, and who are caring for the elderly, or the immunocompromised, and are growing increasingly anxious.

This group is joining many teachers who are managing their own pre-existing health conditions, or those caring for, or living with, elderly relatives, a group that is especially vulnerable to death from Covid 19.

In anticipation of the struggle Jackson has set a new day for the general return, now next Wednesday. In previous conversations and meetings, Jackson has said that she wants compromise, but there has been little of her efforts to clearly establish that goal, and her public speech is focused solely on in person learning.

CTU president Jesse Sharkey has said that conversations improved last week, but that alone seems to have not been enough, and he added that central to the union’s concerns are the 87 teachers who did not report to school; and, were subsequently locked out of remote teaching by the District, and have not been paid.

Mr. Sharkey

Jackson seems, her critics say, intent on punishing those teachers by corralling the rest into submission, without looking at their concerns; a move that can easily lead to another strike, which would be the second in the administration of Mayor Lori Lightfoot.

Beginning last Thursday 25,000 teachers met to decide whether to strike. 

 

ABC Eyewitness News has reported that “The Chicago Teachers Union House of Delegates passed a resolution Wednesday allowing all members to only work remotely”, and ”The measure will go to all members for an electronic vote on Thursday, Friday and Saturday.”

Somewhat dismissively, Jackson noted in a by now infamous roundtable meeting last Tuesday: “A lot has been made about resistance to coming to work this week”, but quickly added “that doesn’t mean that we ignore the concerns that people who have resisted coming in the buildings, we have to listen to those concerns.” 

Of course, listening does not mean acting, and many CTU members view this as disingenuous, her statement not withstanding.

Jackson then quickly added, “We can’t do this work without teachers ... so for that reason alone it’s in all of our interests to have an agreement,” and “People can’t make heads or tails of the back-and-forth,” which seem sironic since she has been part of that conversation.

This looks very bad for the Lightfoot administration coming on the heels of the publicized looting along Michigan Avenue, (in the aftermath of peaceful protests following the murder of George Floyd), the ever increasing crime rate, which also includes often deadly crime on the city’s Red Line elevated train, operated by the Chicago Transit Authority.

In a perfect storm, which this is becoming, Sharkey has said, “RIght now . . . people are being ordered to go into work and they’re saying,” I can’t go into work, I live with my 80-year-old mother who has an immune disorder and I’m worried that she’ll die.’ Tha is the 12th hour for them.”

United Working Families, an advocacy group, said in a statement last week, labelled the Board of Education's plan “botched and reckless”, adding that “Over 1,000 Pre-K and Special Education teachers and other school employees,. . . who are pregnant, suffer from chronic health conditions, or care for at-risk family members, have been denied accommodations by CPS.”

Many say some of this could have been prevented by vaccinating teachers before sending them back to the classroom, an effort that now supported, seems too little and too late, say other advocates.

If clairvoyance is an added talent from the superintendent, she emphasized, “I cannot promise a COVID free environment, nobody can. If anybody tells you that, run in a different direction; they’re lying.”

CPS has said that they “cannot mandate staff members to take the vaccine, and public health experts have said schools can reopen safely without waiting until vaccinations are administered,” said The Chicago Sun Times, in a summary of where the two sides stand, on how, and when to reopen.

Socio economics are also a factor, and many in communities of colors, such as the Latinx community of Little Village; and in that vein, Enlace, a voice of advocacy, issued a statement that the majority, “must recognize that our community is largely made up of essential workers many of whom do not have the option of working from home . . . and are in desperate need of safe, affordable childcare during school hours.”

They have offered suggestions ranging from “learning hubs” as a tool that has been in use, to be reevaluated, and also suggested, along with other ideas, offering “flexible options for older students who are taking on additional responsibilities such as caring for younger siblings or working to increase family income.”

Data from CPS seems circumspect, and they “have not provided student attendance numbers for that first week of in-person learning,” saying that there are difficulties to track the various students that are in person, learning remotely, or in a mix of both.

The Sun-Times reported that I"t’s also not clear, however, how many of those K-8 students will actually follow through with their intentions to return to classrooms. CPS officials on Friday released attendance data from the first week of school for pre-K and cluster students that revealed an average of only 3,189 of the 6,470 students who opted in — 49% — returned to classrooms each day."

Somewhat oddly, at that Tuesday meeting, Jackson also said, “there is no right answer and because more people choose one thing over the other doesn’t make it right.”

In what many observers see as a circular discussion, CPS spokesperson Emily Bolton said in part, after the Wednesday vote, through a written statement: "We have agreed to the CTU's safety demands every step of this process and we are ready to come to a resolution that provides our families the smooth transition to in-person learning they deserve. CTU leadership wants to close schools that are already safely open to students, and cancel in-person learning for the tens of thousands of students who are relying on their dedicated educators to provide in-person learning in the coming weeks.”

If the CTU votes to strike, as we have seen it is to not teach in person, but remotely, a departure from the traditional work stoppage. But Jackson, has said, “Limiting in person education to teacher preferences allows adult preferences to override a family’s educational choices, and will further inequity and disporporatiley harm vulnerable students.”

On Thursday, CPS sent a letter to all of its teachers saying that if they refuse in person work, and continue to teach remotely, then their actions would be an “illegal strike” something that the CTU denies.

The demand to work, regardless of their own health concerns, and that of their family members, in unsafe working conditions is a realistic, and necessary, option says union attorney Thad Goodchild.

Updated Jan 24, 2021 3:08 CST

Madigan out, Welch in, as Illinois Speaker of the House

Legislative history has come to an end in the Illinois state capitol of Springfield on Wednesday with the end of the speakership of Michael Madigan as he ended his 36 year tenure, or as some would call it, reign, with the election of Emanuel ‘Chris” Welch as the new Democratic Speaker of the House.

A longtime ally of  Madigan, Welch who is Black, has made history as the first in this role, and while federal headlines have dominated the local scene, as elsewhere, over the last several months, Madigan’s tenure began to crumble when reports surfaced that he was the central figure in a variation of the old “pay to play” plan when ComEd the dominant public utility provider, for most of Northern Illinois, gave a series of benefits to the speaker, so that they could enjoy greater profits, most notably through legislation that would give them greater profit, at the expense of consumers, and paid a $200 million fee as a penalty.

As is widely known, scandals and bribery in the Land of Lincoln have long been a staple in Illinois political life, most recently with the sentencing, and jailing, of Gov. Rod Blagojevich who tried to sell the vacated senate seat of Barack Obama, when he was elected U.S. president, joining the list of four of six previous governors convicted, with only Blagojevich removed from office.

There have also been a slew of Chicago aldermen who have been charged and convicted of  using public funds for home improvement, mink stoles, and luxury travel, to name but a few crimes; and, almost  nearly as common as the annual dyeing of the Chicago River green for St. Patrick’s Day.

Madigan’s departure is welcomed by many, but also raises some questions about Welch’s past that includes credible allegations of the abuse of women, and the eight term lawmaker was charged with allegedly pounding an ex-girlfriend's head, in 2002, on a kitchen counter, repeatedly, when she called him a loser; charges she later dropped after speaking with one of his relatives, reported The Chicago Tribune..

Asked Wednesday about his past treatment of women, Welch described it as one “incident (that) was over 20 years ago” and, to the Tribune, added, “People mature, they look back and would do things differently, handle situations differently,” said Welch, who didn’t directly answer a question about concerns Democratic women raised about the past allegations,” they noted.

One of the more prominent state reps, Kelly Cassidy (D-Chicago) Democratic Rep. voted present on Welch’s nomination for speaker.

“I did so because, at the same time that we’re ending years of scandal over allegations of sexual harassment and corruption, we have also just been made aware of troubling allegations from Speaker Welch’s past,” said Cassidy, who added she has a “great deal of respect for Speaker Welch and believe him to be a good man.”

“I have reconciled with the individual since that night,” a Welch spokeswoman said in a responding statement. “In fact, after our dispute we sought out the authorities ourselves. “Their family lives in my district and are proud supporters of my public service and work. However, I must convey my dismay over the lack of decency displayed by the GOP politicians and their urge to use this report against me.”

“It is my fervent wish that these allegations will be vigorously reviewed so that we can move forward as a unified caucus embracing this historic moment,” Cassidy said.

Avoiding this stumbling block as well as political survival proved to be tough for both, and nearly a train wreck for him to get the 60 votes needed for nomination, and the trust of a liberal core of state legislators, including Anne Williams, also of Chicago, who had thrown her name in the hat for nomination.

What was said to Williams and Cassidy is unclear, but the time for significant change has come, but there are those who doubt if it will be done. Among them House Republcan minority leader, as local public radio station, WBEZ said: ““His legacy leaves broken promises to Illinois taxpayers,” Durkin said, telling Democrats to “listen” and “this is my time to talk'' as they began to stir at the direction he was headed in his speech. “A legacy driven by absolute power and control so much that his business model forced the largest public utility in the state to enter into a deferred prosecution agreement with the U.S. Attorney’s office in Chicago.”

Welch spearheaded the investigation into the ComEd deals, and there was no concluding result found, leading some in the GOP to see this as a form of protection for Madigan, so that he could bow out gracefully, without results or being charged.

The former speaker was gracious in his remarks, and said in a statement, ““I wish all the best for Speaker-elect Welch as he begins a historic speakership,”. [and]“It is my sincere hope today that the caucus I leave to him and to all who will serve alongside him is stronger than when I began. And as I look at the large and diverse Democratic majority we have built—full of young leaders ready to continue moving our state forward, strong women and people of color, and members representing all parts of our state—I am confident Illinois remains in good hands.”

For his part, Welch has several items on his agenda, and said,“There are some things I would like to continue but there are some things that I would do differently. I think those things that I would do differently are going to show up and I’m going to distinguish myself,” according to media reports.

The formation of the Rules Committee will be a direct contrast to Madigan because that was the arena he held to kill bills that he did not like.

There is also pressure from the Black caucus to hold fast to an agenda, that besides the usual equity issues in education and employment, also as the Tribune noted about his predecessor, added, “Madigan is under increasing pressure from the Black Caucus to deliver on a multipronged package that includes controversial changes in policing, including restrictions on collective bargaining rights over discipline that are opposed by more moderate members.”

Racial and gender diversity is also sought as a mainstay, as is the uphill drive at legislative redistricting to maintain the power of the Democrats.

While suspicion remains about Welch, as a legacy pick by Madigan, Illinois faces a $4 billion deficit, (much from a bruising series of mistakes on pensions), along with job loss, stemming in no small part, from former governor, Bruce Rauner; but, also now, reeling from the effects of COVID; along with health care disparities and challenges, amongst the foremost.

Illinois Gov. Pritzker forced to make budget cuts

 Closing the year for many people means holiday presents, and good times, but for Illinois Gov. J.B. Pritzker the holidays will be a grim reminder of the failure to pass his graduated income tax proposal to raise an expected $3 billion dollars to shore up the sagging finances of his state, and in particular to help pay public pension, but that fell flat after a highly financed campaign against it by billionaire hedge fund and CEO of Citadel, with ads falsifying many claims, such as taxing retirement income, and was roundly defeated by voters in November.

Pritzker, himself a billionaire, spent more than $56 million, and still lost, with only 46.7 percent of the vote, in a battle of billionaires, and which The Chicago Tribune Editorial page belittled him as being lazy and as the old trope goes, a “tax and spend” Democrat.

Not one to lie down and roll over, he shot back: “I’ve reached out to the General Assembly, in particular to the Republicans, because they have a special responsibility here, having worked so hard to defeat the fair tax, to step up to the plate, tell us how they’re going to balance the budget, given that we have a $3.9 billion deficit, and you know about half of that has come from structural challenges that the state has.”

“Illinois House Republican Leader Jim Durkin, of Western Springs, took aim at Pritzker, Senate President Don Harmon, D-Oak Park, and Speaker Michael Madigan, saying in a statement the three were “repeatedly warned about the dire shortfalls in the fantasy budget that relied upon the passage of the graduated tax and a ‘fingers crossed’ hope for a federal bailout.”

“Instead of living within our means, they attempted to trick voters into raising taxes, and were sorely rejected by Democrat, Republican and Independent voters across the state,” Durkin’s statement continued, according to the Chicago Tribune.

Taking the city will not be easy for Pritzker who put an excess amount of political capital in the effort, and now with the state facing much needed dollars, he announced a week ago that there was going to be $711 million in reductions, only the beginning to fill the $3.9 billion deficit or the current fiscal year which has overjoyed some of his critics who have long called for state hiring freezes, unpaid furlough days and a reduction for retirement funds for one year, among other ideas.

For many of those ideas, they seem more like graduate school exercises rather than reality based ideas, that don’t take into account those living on the expectation of state payments, and as we have all seen from the past, temporary reductions in payments can quickly be like the ghosts of Christmas past coming back to haunt us.

On the chopping block for many is a reduction in social services which we’ve seen before with the Bruce Rauner administration that left many of these agencies begging, or being forced to limit or end services for battered women shelters and drug and alcohol treatment centers, to name but two.

The Belleville News Democrat reported that “Having gotten wind of possible cuts months ago, southwestern Illinois agencies have already started planning for more bad news in the near future.

It won’t be the first time Renae Storey, vice president for the southern region of Children’s Home and Aid, will have worked through a fiscal crisis. She remembers the budget impasse under Gov. Bruce Rauner and how it affected the statewide child and family advocacy nonprofit.”

“We know that cutting any part of human services will be detrimental to families, and it will be detrimental to the state budget because more costly alternatives would probably happen later,” Storey said.

They also  reported that “One of the organization’s programs, for instance, has reduced the number of St. Clair County children going into the juvenile justice system each year from 90 to 10 since 2005. The cost of one year in juvenile corrections costs $160,000, whereas Redeploy Illinois costs roughly $10,000 per child.

“We know there may be cuts coming, but we’d like to have a seat at the table so we can help inform the lawmakers and the governor’s office about how important these services are,” Storey said.

That request should be part of the effort in planning the cuts, along with lawmakers on both sides of the political divide to make a good part effort to minimize the pains of budget cuts.

Of course, the blame game is part and parcel of politics, and with some justification on the part of Pritzker, and his critics who are in a “told you so” mode that gives little and takes much.

The governor has said that he will negotiate with unions on $75 million in personnel cuts, and we can only hope that level of cooperation will continue.

While this has much traction from some, like Andy Shaw of the Better Government Association, others disagree, notably Roberta Lynch, the executive director of the American Federation of State, County and Municipal Employees, who said according to the Chicago Sun Times “it is grossly unjust to suggest that frontline state employees who have already sacrificed so much in our current public health crisis should bear an outsized share of the burden of fixing the state’s fiscal crisis as well.

“Moreover, it is counterproductive in the extreme to target these employees at a time when the need for state services and the demands on state government are greater than ever.”

With a reduction of about 10,000 fewer incarcerated people, projected savings are expected to net $25.4 million, but as reported “the remainder will come from $45.6 million in operational and grant reductions to corrections, Illinois State Police and other agencies.”

On the federal level, Pritzker, like many states hit hard with a loss of revenue from Covid 19, had hoped for help from Congress, that Republicans had fought tooth and nail describing them as “bailouts” a political ploy for attacking blue states.

In particular schools need those federal bucks, and as the governor had noted earlier, “Our schools and our public safety and health care deserve more investments, not less.” 

Unfortunately, the $2.3 trillion bill passed on Monday did not contain the contentious state and local money that Pritzker wanted, and some voices from Washington are doubting that the incoming Biden administration may be capable of getting it passed either.

With a nearly $4 billion budget deficit for 2021, there is also a projected deficit of $4.8 billion in fiscal year 2022, with a slight reduction to $4.2 billion by FY 2026, in no doubt caused by the continuing pandemic; but, also a continuing backlog of bills projected to increase from an approximate $10.1 billion for FY 2021 to $33 billion, over the next five years.

Pritzker plans to borrow another $2 billion from the Federal Reserve’s municipal liquidity fund, which was created to help governments, after earlier borrowing $1.2 billion from the program and repaying $200 million, Bloomberg News reported, and the Tribune reiterated.

“The state had originally authorized borrowing $5 billion from the program. Loans must be repaid over a three-year period, and state officials had planned on using new federal stimulus funds for state and local governments to repay the borrowings.”

Even these may have had their day since Sen. Pat Toomey, R.Pa. wants to do away with them saying their time has come and gone. As MSNBC reported “Toomey said he fully supported the wide-ranging credit programs launched by the central bank in March in response to the burgeoning pandemic. But he contended that they should be wound down at the end of December and congressional approval must be required again before restarting them.”

In defense he added, “I voted for that. I supported that because I thought we were in such an emergency. We are clearly not in a financial crisis at this point."

Such “Cassandra” like moves like his were prevented by Democratic leaders fearing that President Biden might lose a resource, while others questioned what Toomey designated as a crisis.

Needles to say 2021 for Illinois finances will be at a crisis point, and we hope that both sides of the aisle can work together to create a plan, now that the graduated tax horse has left the barn.

Lightfoot pushes for a tax dependent budget

 

Going it alone seems to be the theme for Chicago Mayor Lori Lightfoot’s budget address on Wednesday where she has laid out a plan to address a $1.2 billion deficit for the nation’s third largest city, and in an atmosphere of tension and anxiety over the devastation that has wreaked havoc on the city’s economy from Covid; but, also one that has suffered losses in previous administrations, especially for obligated pension payments.

The biggest item is the $94 million property tax increase making the one from her predecessor, and for some dwarfs Rahm Emanuel, of $55 million but a redrafting to a federal index may reduce the pain.

Adding in the refinancing of $500 million in city debt and taking $30 million from city reserves to preserve Chicago’s bond rating makes for some intense work from Ald. Gilbert Villegas, Lightfoot’s floor leader to get 26 votes from a city council that has often been at loggerheads with her, make his work all that difficult.

The silver lining is that eliminating 1,000 vacant city jobs, along with layoffs of nearly 500 city employees, will not come till March as she hopes for a Democratic victory from Joe Biden and a changed Congress that is willing to chip in to make the city staunch its hemorrhaging of cash.

Seemingly, that is only the beginning, and as the Chicago Sun Times noted, “Declaring a record $350 million tax increment financing surplus to generate a $189 million windfall for the Chicago Public Schools, but snatching back $55 million of that money by shifting pension and crossing guards from the city to CPS,” ratchets up the criticism, that Lightfoot is bound to receive for her efforts.

Unpaid furlough days for city employees, in the thousands, that are non union, is a neat effort that preserves jobs, and is a corporate move, may garner her some points, but not much, as she will no doubt face public ire, and some from Chicago Police Department, who is already railed against her for her handling of the lootings that attended the mostly peaceful protests in the aftermath of the George Floyd murder.

450 police officer positions are also vacant, and there is sure to be political payback by Fraternal Order of Police President John Catanzara whose willingness to opine on any weakness is now standard.

There is some willingness from labor to help her identify cuts on the city payroll and Chicago Federation of Labor President Bob Reiter has promised help in identifying  where, and how, the cuts can be made, and also according to the Times, “We’re talking about identifying big money to help them close the gap in lieu of laying off or furloughing anybody. If we propose more than what they need for that, I’m happy to let them figure out where else they can help the city budget, once we get the workforce stuff under control.”

To add to the pot, the mayor has proposed an increase from a nickel to 8 cents, for a per gallon gas tax, which has raised the hackles of Chicago Teachers Union Stacy Davis Gates who said it would hit working class families, “in the middle of a pandemic when people aren't taking public transportation is tone deaf.”

The Council is the testing point, and as seen before in previous budget discussions and other proposals, she lacks the so-called “rubber stamp” of prior administrations, and already we have this: “I have concerns about the borrowing, as well as the cuts, what they’ll mean for services,” said West Side Ald. Jason Ervin, 28th, who chairs the council’s Black Caucus. “Without question, we need greater investments in violence prevention. We’re facing a difficult situation, but we need to be able to walk and chew gum at the same time.”

Labelling the property increase as “modest” might seem to be disingenuous in a city that is already taxed to death, say some, and some will say that her other efforts might not be enough. And, among them is Ald. Maria Hadden of the 49th ward who said that she wants to see more cuts and more money taken from city reserves.

Her remarks to the Chicago Tribune, “acknowledged Lightfoot’s argument about the “modest” property tax increase but said it would hurt many residents who live in apartment buildings in her ward. About 70% of her ward’s residents are renters.”

Hadden also said: “I’ve got some concerns about the property tax and the gas tax, in particular, thinking of so many of the folks who live here who would really be hit by these things.”

Lightfoot seemed optimistic and said, “Some had predicted that this budget would be predicated on hundreds of millions of new property tax dollars. Not so,and emphasized, “And for the average Chicago home valued at $250,000, you will pay just $56 additional dollars for the whole year. That’s right, just $56 new dollars per year.”

Raising taxes is not at the top of any lawmakers agenda and there are those that say, despite her optimism, that she should not propose them. And, there are some that want her to wait for a new Congress, and president, to get federal money, but as we have seen from 2016, there are surprises.

“The proposed budget calls for $185 million in property tax and revenue increases that undoubtedly will place further strain on already struggling families and businesses, particularly small businesses,” said Jack Lavin, president & CEO, Chicagoland Chamber of Commerce. “Employers and families cannot afford new taxes that will slow down business growth, which ultimately stunts hiring and impacts residents and consumers throughout Chicago,” reported WBEZ.

For a city long held with clout, there are a  myriad of contracts, and some have praised Lightfoot for taking the plunge and reviewing them for elimination, or review.

“These are literally hundreds of millions of dollars in contracts, locked up in what has effectively become hundreds of de facto sole source contracts in perpetuity,” she said.

An increase in job cuts was always on the table and “Lightfoot’s 2021 budget proposes to cut 1,921 city workers from the budget, a third of which are in the police department. This will save more than $91 million and city officials say many of those positions are already vacant. The mayor is also planning to force workers to take unpaid days off, but did not provide specifics,” they added.

Scrubbing each corner may be a long sought goal and the mayor does display some courage in even beginning to tackle this duty.

Those who have looked for a defunding of the Chicago Police may be disappointed that she has not taken sharper cuts, but she defends her actions in the interest of crafting a more diverse police force.

“If the city reduced staffing levels for rank-and-file officers, veteran officers would be given preference and the younger, more diverse class of cops would be cut, the mayor warned, the station reported.

“I am also fully aware of the complicit role that police departments dating back to our earliest times have played in brutally enforcing racist, Jim Crow laws, and depriving Black and brown people from achieving our full rights as citizens,” Lightfoot said. “But I do not believe that having fidelity to this essential work of bias-free policing requires dismantling our police department.”

Tying the property tax increase to the federal consumer price index is an idea championed by some in the past, and Lightfoot gets kudos for this effort at fair increases, but the Tribune opined that raising taxes in a city that already has property owners paying high taxes and high sales tax, and even a shopping bag tax, is this adding to the litany of woe, say critics.

Progressive council members, like Hadden will prove to be a source of pain for Lightfoot, as their agenda calls for more bread and butter deals to help those on the margins and rejects regressive tax measures (seen before by former mayor Rahm Emanuel) and pointedly said in part from an editorial from the Times: “We reject any attempt to raise revenue through regressive measures. Measures such as a property tax hike and increasing fines and fees for ticketing, towing or garbage should be reexamined in favor of more progressive options.”

Pritzker's Fair tax proposal is not fair say opponents

Illinois voters began early voting statewide Wednesday, and on the ballot is a proposal for a graduated income tax to replace the current flat tax, a campaign promise of Gov. JB Pritzker to help add  $1.2 billion to the state revenue stream, partly to fill the deficits left by pension obligations, and other indebtedness.

The proposal has received a great deal of support from the governor and progressive groups to level the playing field, so that billionaires, including Pritzker himself, pay the same amount as service workers.

Supporters also see the move as a change to economic equity and increased contributions to the local economy, by an increase in consumer spending, and to support the household budget for families and individuals to meet basic expenses, such as rent, mortgages and food.

Those in opposition, including many chamber of commerce, and mainline professional organizations see it as a job killer and a punishment for innovation, and that its passing will lessen not only economic investment, and flights to other states.

Illinois is not alone with the flat tax, currently at 4.95%, and joining it are Colorado, Indiana, North Carolina, Massachusetts and neighboring Michigan.

For some, the opposition’s labeling it as a job killer, are reminiscent of “trickle down economics” from The Reagan era’s budget director, David Stockman, who later discredited it.

California is an example of a wealthy state with a graduated income tax, and is more populous than Illinois, and has seen no mass exodus of wealthy entrepreneurs, or a brain drain resulting in diminished entrepreneurship.

For argument's sake, Forbes Magazine has noted that the richest of the 1 percent pay 38 percent of federal income tax, and  towards the bottom a healthy 47% pay nothing at all. And, that point is well taken when one considers that federal taxes are graduate, not flat.

The Chicago Tribune has noted that Pritzker’s plan has a majority of Illinois residents supporting it, and cites a ” A Paul Simon Public Policy Institute poll last February [that] found 72 percent of 1,001 registered Illinois voters backed such a change, and 76 percent supported an extra 3 percent tax on all income over $1 million a year.”

Those in opposition are predicting a doomsday scenario, including that retirement income will be taxed; a false assertion that nevertheless has hit the airwaves, in a series of television and radio ads despite a huge push from AARP stating the opposite.

A conveniently overlooked fact is that Illinois does not tax retirement income, and tax rates are not part  of the State Constitution.

While such scare tactics abound, the ballot item is a hot button issue, where the truth doesn’t lie in the middle, but rather inside the contours of self protection by many very wealthy people, including Ken Griffin, CEO of hedge fund Citadel, and a proponent and a financial contributor to fight Pritzker.

Supporters say that accepting crumbs from the table of the wealthy is not the case, and even having a table, of their own is especially worrisome in the COVID era, when so many families are working with limited funds, and face eviction, due to  job loss; and one that economic paternalism cannot protect.

Advocates have also seen this as a way towards economic redistribution, and a way to partly reduce income inequality across Illinois.

A conservative estimate, if passed, is a gain of $1.2 billion in new revenue, and without the need for more borrowing, a prediction of $5 billion, in the future, based on pre pandemic estimations.

Another goal, say supporters, is to meet the need for education funding from the 2017 reform law for school revenus, called evidence based funding, and in particular, $50 million needed for K through 12 education  to be given to low income school districts.

Those opposing say that it has nothing to do with education, but simply a move for the state to have a blank check at the ready, should a need arise, to raise taxes.

There is a huge laundry list of opposers besides Griffin, including Petco, Duchossois Group, RIchard Uihlein, of Uline office supplies, Illinois Policy Action and the Illinois Business Alliance, plus the Illinois Farm Bureau.

“The progressive tax increase is the same thing as leaving a huge bag of taxpayers’ cash at the backdoor of the statehouse and city hall,” according to Illinois Chamber of Commerce President Todd Maisch in a round table discussion in Central Illinois held  earlier this year.

Going even further is Richard Guebert, Illinois Farm Bureau president, who said, at that same meeting, “to cover all of Springfield’s spending and debt, the tax brackets and rates will have to be changed to raise taxes on the middle class and even the working poor, with higher rates starting at incomes as low as $25,000 per year . . .  the truth is that this amendment will open up every Illinoisan to tax increases.“

To be fair, Pritzker has never said that he expects the proposal would cover all state debt; but, that assertion, from his critics, shows how, in the blink of an eye, even the best intentions can quickly become political reality.

The Tribune has also noted that “Pritzker has estimated a revenue loss of $6.5 billion this budget year and next and has helped to keep the spending plan solvent with $5 billion in federal borrowing. But there is uncertainty over how to pay it back as Washington remains stalemated over giving money to state and local governments.”

Chicago needs money from Feds to stay afloat

 

When Chicago Mayor Lori Lightfoot announced recently that there was a $1.2 billion hole in the city’s budget that needed to be filled, the news was met with near disbelief, and with more than a bit of shock and awe; but close observers of City Hall have seen over previous administrations that Chicago finances have been in abeyance for some time, mostly riddled with mandated pensions that had been often ignored with pension holidays and raids on the funds to provide revenue to public transportation.

What makes his unique is the depletion of sales and tax revenue from COVID 19, and the damage that it has done to economy of America’s third largest city, and while not alone the parameters of Lightfoot’s dilemma is one that has faced a myriad of cities across the country, and with 1.5 million government workers laid off, her plea, and that of Gov. JB Pritzker’s for federal help is warranted.

Congressional help is separately needed to put food on the table and pay the rent and mortgages of millions of American households across the country, but President Trump seems determined not to help Democratic cities and states, for a “bailout” an often used term when the need for help comes from these cities, even if warranted.

While as The Brookings Institution has noted, “sizable reform is needed,” but the recent August Jobs Report showing that 1.4 billion non farm jobs were created has given a push not to give too much help, since the White House sees the report as proof that the economy has come roaring back, despite the view from most economists, including the Federal Reserve Bank, that the U.S. has a fragile economy, and one that has been devastated by the pandemic.

Now with the death of Supreme Court Justice Ruth Bader Ginsburg on Friday, many are wondering if there will be even a measure of political will to negotiate with Nancy Pelosi, and the House of Representatives, even though she reduced what was once a $3.2 trillion bill, to a reduced $2.2 billion aId package; but, with the push to fill the seat as fast as he can, many are wondering if any aid will be forthcoming beyond the $300.00 of extended benefits, once the previously held $600 per week, benefit recently ended, leaving many families, as well as individuals, fearing that they might go underwater, and in some cases homeless.

In the time of growing racial unrest, across the country, laying off, or furloughing state and local employees, is also problematic, since many of these “safe” jobs, many held by Black and Brown women, (often head of household) are now threatening the family budget, already stretched thin since the March pandemic shutdowns.

Equally problematic is the threat to local infrastructures which is also threatening family income, in an area that was once, also thought safe, construction and trades. And, in Illinois, as The Associated Press reported, “first time claims for unemployment benefits totaled 23,339 last week, down from 25,478 a week earlier,” but still not at pre pandemic levels.

For Lightfoot the temptation to raise property taxes is a red hot rail that she does not want to touch, and as one local civic head noted, she can’t tax her way out of a budget deficit. But, earlier this month the mayor said, “"I can't take it off the table, but it is truly the last thing I want to do,"

While some feel that chicago should be more like other cities, for example Boston and its high property taxes as a stable source of income, then again their residents are already “educated” in that fact, but not Chicagoans.

Chicago Magazine opined that “Instead of a property tax increase, Lightfoot called for a new casino in Chicago. That’s not the most sensible solution: as The New York Times reported, “[i]n Detroit, one-fifth of the municipal budget typically comes from casino revenue. And casinos have just reopened, at reduced capacity.Detroit ranks 4th among cities whose budgets are vulnerable to the COVID-19 recession”

Lightfoot is also twining two solutions here; revenue and to regenerate, if granted, to put the casino in areas of the city that have been .underserved, and racially restricted.

Another plan is reaching out to labor leaders to allow volunteer layoffs or furloughs, seems to be naive at best, or fantasy at worst; two traits that do not fit with Lightfoot, but might be reflective of her advisers.

Overall, big cities like Chicago are taking the hit in more than one area, and the effects are near those of the Great Recession with the resultant drop in the nation's GDP has made the maxim that all politics, and money, are local.

To that effect, “A recent New York Times story ranked 41 cities based on how likely they are to suffer severe revenue shortfalls as a result of COVID-19. Using projections from National Tax Journal, Chicago ranked 11th, with an estimated decline of 11 percent. In last place (which is really first place) was Boston, with 4 percent.”

A recent report noted that the number of Americans applying for unemployment benefits fell last week to 860,000, a historically high figure that reflects economic damage from the coronavirus outbreaK,” reported The Associated Press.

That the U.S. Dept. of Labor said that the claims fell by 33,000 from the previous week, with 12.6 million collected standard unemployment benefits, “compared with 1.7 million a year ago,” seems scant consolation.

Lightfoot also, in the vein of Pelosi, added, “plans to seek authority to appropriate $1.3 billion in Coronavirus Aid, Relief and Economic Security Act grant funding to help struggling residents, including the city's homeless, homeowners and those in need of mental health resources. Federal guidance dictates the money must be directed to COVID-related costs, including immediate health expenses and economic and social impacts, reported local station, NBC Chicago.

In an inevitable task list, this is just the beginning of relief for the city, since there is also as the state’s economic driver, Chicago has to also proved mental health services, help manage courts and law enforcement, and in these last few months meet the cries for police defunding, a source of frustration, for those affected by police brutality, but also a necessity and major line item in the city’s operating budget.

Unlike many cities, Chicago did get permission from the state to borrow money, especially to pay its pension debt, but this also proved to be a conundrum as it waged a might battle of the budget under Lightfoot’s predecessor, Rahm Emanuel, that made things worse, before they got better.

In that former enario, “Illinois passed a law allowing Chicago to issue debt under a far more complex structure than regular “general-obligation” bonds.

With the pandemic still in full force, but less so for the city, she has to raise revenue and cut spending, and only time, (which is in short supply) can tell how successful, this can be with little to no Congressional agreement, other than another round of stimulus checks, but with a White House that balks at “bailing out” blue states, things look rough.

By her own admission, Lightfoot says that she inherited indebtedness, both pensions, and the payment of interest from the aforementioned borrowing, yet in 2019, there was a mixed report that Emanuel had stabilized the budget.

But others noted, as we reported at that time, “All in all, the city of Chicago is in a better structural position than prior years,” said Laurence Msall, president of the Civic Federation, which monitors state and local finances, “but it will continue to face revenue and expenditure pressures resulting in projected growth in future deficits.”

We also quoted Budget Director Samantha Fields who remarked, before the mayoral election, that, “The city projects that spending for day-to-day operating costs will increase next year to more than $3.8 billion, an increase of nearly $50 million over budgeted spending for this year. That’s attributable to rising personnel costs and some expansions of city services.”

Of course, that is pre COVID, but what is past has become prologue, and at the time we noted that The Chicago Tribune said that Chicago “could find itself facing higher costs that were not included in the projected budget forecast. Those potentially include tens of millions of dollars for raises and back pay for police, firefighters and some other city workers whose unions are negotiating new contracts — as well as any costs added to the expense of running the Police Department as a result of a proposed federal consent decree aimed at restoring community trust in the long-troubled department.”

Those are now all on the table. And with a pending police contrat, Candidate Lightfoot said at the time complained of “the absence of costs in the report by the mayor; what she called the absence of  “specific dollars” and noting that the cost for the monitor (from the consent decree) alone might be as high as $2.5 million, with an overall price tag to implement the reforms would cost at least $10 million a year, insisting that those costs be written into the document itself.

Mark Muro writing for a Brookings blog, “The Avenue” emphasized, “If more specific numbers are desired, a new report from Moody’s Analytics warns that doing nothing to address the economic perils of state layoffs and [local] cutbacks could cost 4 million jobs in the next two years. According to Moody’s, at least $500 billion in combined state and local aid is needed.”

Something to keep in mind as voters head to the polls for the presidential election in less than 60 days.