Bankruptcy Versus Federal Bail Out For Chicago And Illinois
BREAKING NEWS: Bankruptcy Versus Federal Bail Out For Chicago And Illinois
Most Americans now know the devastating economic impact the coronavirus pandemic has done to the United States.
- Prior to the pandemic, the U.S. economy was the strongest it has been in decades
- Most Republican-led states were thriving and had surpluses
- Low taxes and other government incentives were attracting new individual taxpayers and businesses to many states such as Indiana, Florida, Texas, Nevada, Tennessee, Georgia, Alabama, Mississippi, and countless others
- Other states such as Illinois and New York were forcing taxpayers and businesses to other low-taxed states due to high states and new taxes
- Freshman Illinois Governor J.B. Pritzker has created new taxes and increased existing taxes for individual taxpayers and businesses
- Pritzker’s tax increases have forced countless Illinoisans and businesses to lower-taxed states like neighboring Indiana
- Not only has Governor Pritzker increased and created taxes all over the board, but he is spending more than any other governor
- He is actually increasing the deficit and running the state like a Ponzi Scheme
- Most Illinois taxpayers are having voter’s remorse for voting for Pritzker
- Now with the pandemic crisis, all 50 states have suffered a major financial blow
- Most state governors had issued a state of emergency with a stay at home orders
- All sitdown and bars were ordered closed until further notice
- Millions of Americans were out of jobs
The loss of revenues from closed businesses and unemployed workers is affecting financially irresponsible states prior to the pandemic like Illinois and New York.
Unemployment Due To Government Stay At Home Orders
Over 26 million Americans have filed unemployment claims in the past 4 weeks:
- The good news is many states are set to reopen starting this week
- The Illinois Governor and the state’s Democrats are trying to pull a fast one
- They are using the coronavirus pandemic crisis as a tool to bail out the financial irresponsibilities of Illinois prior to the pandemic
- Illinois has a huge budget deficit in its pension system
- No matter how much taxes are raised and/or created to break even the pension system, the deficit is getting worse and worse
- Pritzker and the Democrats are asking the federal government to bail them out
- Not so fast, says Mitch McConnell, the Republican Senate Majority Leader
- McConnell said financially irresponsible states should not ask the federal government for their mismanagement of finances prior to the coronavirus pandemic
In this breaking news article, we will discuss and cover Bankruptcy Versus Federal Bail Out For Chicago And Illinois.
McConnell Says Bankruptcy Versus Federal Bail Out For Financially Irresponsible States Like Illinois
Pritzker and Illinois lawmakers saw an opportunity to benefit from the coronavirus pandemic.
- The federal government is working on phase four of the coronavirus stimulus package
- Nobody yet knows what it includes
- However, a bailout for states seems to be likely
- However, the federal bailout package for states is just for the financial impact due to the coronavirus pandemic
- States like Illinois and New York had major financial problems prior to the pandemic
- These states are lobbying to have their financial issues prior to the pandemic included in the federal relief program due to the pandemic
- No go, says U.S. Senate Majority Leader Mitch McConnell
- Senator McConnell suggested that states like Illinois and New York can file for bankruptcy
- Illinois has a major pension debt problem
- However, Governor J.B. Pritzker said bankruptcy was out of the question
- Pritzker said it is the right of Illinois to get a federal bailout to fix the state’s budget problems
- No matter how much tax increases in Illinois, the pension debt keeps on getting worse
McConnell is vehemently against bailing city, county, state government from mismanaged finances prior to the coronavirus pandemic.
Democrats Versus Republicans On Bankruptcy Versus Federal Bail Out
All financially strapped states prior to the pandemic were Democrat-led states. In general, Democrats believe in raising taxes to offset their spending. Republicans, on the other hand, believe in having lower taxes to attract new taxpayers and businesses. Republicans believe in tax cuts to promote growth and reduced spending. Republicans also believe in it is not how you take in but how much you spend. All successful states with budget surplus prior to the pandemic were Republican-led states. Most Republican-led states are against federal bailout for states facing major deficits due to financial irresponsibility prior to the pandemic. Democrats differ. New York Governor Andrew Cuomo issued the following statement after McConnel’s bankruptcy recommendation:
I dare you’ to allow states to declare bankruptcy. We’re going to push the pause button here because I think this whole business of additional assistance for state and local governments needs to be thoroughly evaluated. There’s not going to be any desire on the Republican side to bail out state pensions by borrowing money from future generations. Federal dollars for state and local governments should be part of a coronavirus relief package.
Illinois Governor J.B. Pritzker defended the New York governor and criticized Senator Mitch McConnell. Pritzker issued the following statement:
While McConnell is important in the process of getting things done in Washington, many senators disagree with him. I am hopeful those senators realize state and local governments “deserve and need additional support. Illinois has $138 billion in unfunded public employee pension debt. Under the U.S. Constitution states are prevented from filing bankruptcy. Illinois’ constitution has a pension protection clause that treats pension benefits as a contract. The state’s Supreme Court has ruled the clause prevents public pension benefits from being diminished.
There is no doubt Illinois needs to restructure its pension system. There is no way in the world Illinois can keep on funding additional funds to its pension system. The system is broken. Pritzker and lawmakers are increasing taxes in all areas. It is not making a dent. Illinois has the second-highest property tax rate in the nation. High property taxes mean lower home values. The governor is lobbying to change its current flat-tax to a progressive tax system. Illinois leads the nation in both individual taxpayers and businesses fleeing the state due to its high taxes.