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Latest News - August 2015

August 10, 2015
Illinois' Union Debacle
Source: NILRR.ORG

The frail school district that educates nearly 400,000 young Chicagoans is gasping to lower its personnel costs. City Hall, too, fears the remote but real specter of bankruptcy. Cook County and many suburbs have awakened to their own debt crises. On high, the grossly overspent state government that temporarily and notoriously hiked taxes to pay overdue bills … still can’t pay overdue bills. Pass an honestly balanced budget? Bah.

Never mind that CPS has been paying most of the employees’ share for 34 years. The big story is that tectonic plates are shifting: Finance crises are roiling old political relationships, and rocking policy postures that are now obsolete.

Rauner is thinking long-term: If Illinois doesn’t restore economic growth and rising incomes, legacy costs will continue to strangle this state’s 7,000 governments. Empowering those governments to control their own costs is one way to give them a chance of survival in the form their constituents expect. Tax hikes will drive even more employers and other taxpayers to more competitive states.

And some Dems wary of Rauner’s effort to permit local right-to-work zones admit privately that the unions may have to relent: Four of the six states bordering Illinois — Indiana, Iowa, Michigan and Wisconsin — now are right-to-work states, poaching businesses from jobs-starved Illinois.

Until now the survival strategy at CPS, City Hall and elsewhere has been to beg help from Springfield, duck cost reforms and keep borrowing by the billions. But the credit markets, which already charge huge interest penalties to indebted governments here, won’t let that go forever.

At some point — maybe now — Democratic leaders have to decide: Will we keep blocking reforms that would cut government costs? Or will we tell our union allies the truth? We can compromise to rescue failing governments. Or we can let them, and many union jobs, implode.

 

 


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