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Thursday, September 19, 2019

Kiss-off: Too many Illinoisans breaking up with the state

Their View

By Vincent Caruso, Illinois Policy Institute | Feb 14, 2018

For too long, Illinois homeowners have been handed the same lousy assortment of Valentine’s Day gifts: sluggish jobs growth, self-destructive spending habits and onerous taxation.

In turn, Illinoisans are severing their relationship with the state.

Illinois has lost a staggering 643,000 residents to other states on net since 2010, according to the U.S. Census Bureau.

But it isn’t just people. As a consequence of Illinois’ population exodus between tax years 2010 and 2015, the state lost $3.4 billion in adjusted gross income to its neighboring states alone, according to IRS data.

Four consecutive years of population decline has caused Pennsylvania to overtake Illinois as the nation’s fifth-most populous state.

This ought to produce an urgency for reform from state lawmakers. But if Springfield’s governing habits over the past year are any indication, they have yet to take a hint.

First, lawmakers must understand the causes driving Illinoisans into the arms of the Land of Lincoln’s neighbors. Primarily, according to Illinoisans themselves, the answer is blunt: taxes.

Among Illinoisans polled by the Paul Simon Public Policy Institute in October 2016, 47 percent wanted to leave the state. Among these respondents, the study found, “taxes are the single biggest reason people want to leave.”

Property owners in the Prairie State are especially strained under the weight of the state’s punishing taxes. Illinois homeowners see some of the highest property tax bills in the country. From 2008-2015, families watched property taxes grow six times faster than their incomes. Still, lawmakers didn’t let this stop them from pushing through the largest income tax hike in state history in July 2017.

But the July tax hike will only inflict further pain on Illinois’ already struggling economy.

Being asked to foot the bill for spending that lawmakers don’t care to control has proven too tall an order for Illinois taxpayers.

No household spending recklessly beyond its means can remain above water for long. State lawmakers should take that lesson to heart.

A smart spending cap that ties growth in state spending to growth in the state’s economy would restore fiscal discipline while allowing Illinois to get its finances in order. This could provide a path for reductions in Illinoisans’ tax bills.

Provided lawmakers are willing to consider sensible fiscal reforms, 2018 could be the year Springfield renews its vows to taxpayers.

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