More people left Illinois last year than did residents of any other state. And most of them landed in Tennessee.
Why are they leaving and why do they choose Tennessee?
While the violence in Chicago has received much publicity, most of those fleeing Illinois are not the ones who live in the hellish inner-city neighborhoods. No, what’s driving Illinoisans away is not bullets but tax burdens.
In a Sept. 4 editorial for the Chicago Tribune, Kristen McQueary lays out, with sardonic wit, the reasons why Illinois is losing population while Tennessee is gaining.
By McQueary’s estimation, the steady outward migration, which has been going on for several years, is about to get a lot worse if the political winds in the state’s Nov. 6 gubernatorial election blow more Democrat lawmakers into the Capitol and Democrat J.B. Pritzker into the governor’s mansion.
Pritzker and company have let it be known they intend to overhaul the state’s tax structure – again – with a sweeping constitutional amendment. The change would replace Illinois’ flat tax and give politicians the flexibility to institute a graduated income tax — “and then adjust the tax rates in perpetuity,” McQueary writes.
Those “adjustments” will occur in one direction – upward.
“They want us to write another check and shut up,” she writes. “Or move.”
Illinois’ credit rating has reached junk-bond status. Its debts and pension liabilities are above $200 billion and taxpayers are paying more than $1 billion annually in interest for late payments to state vendors. Property taxes are the second-highest in the nation and the state has to borrow money to balance its budgets.
As the old saying goes, the problem with socialism is that you eventually run out of other people’s money. Illinois residents are finding that out the hard way, after years of electing socialist politicians promising ever more attractive government-funded “free” programs.
According to McQueary’s editorial, Illinois already has a tax structure that mercilessly rakes residents over the coals.
Lawmakers slammed a 67 percent personal income tax hike through the General Assembly in 2011 under the condition that it would be temporary, only to waffle on their promise and try to make it permanent.
“Under pressure, they did allow a portion of the tax to sunset. For a moment. Then they passed a new 32 percent income tax hike. And now they’re vowing to rewrite the state constitution to permit a graduated income tax without revealing how much it would cost,” McQueary writes.
Forbes sent up warning flares back in May 2016 with an article by Travis Brown comparing high-growth, low-tax states like Tennessee to tax-and-spend states like Illinois.
Illinois, Brown wrote, was “attempting the impossible task of taxing its way into prosperity.”
“So while the Democrat legislature talks up a higher tax on ‘the rich,’ in reality they are punishing the small businesses that are the economic drivers of the state and the nation. It’s little wonder, then, that between 1992 and 2014 Illinois lost nearly $42 billion in net adjusted gross income, with nearly a quarter of that staggering total going to income-tax-free Florida. With the odds stacked against Illinois, the state should probably not embrace a tax hike that will drive it even further into the red.”
These tax hikes are especially hard on lower middle-class working families, those with household incomes roughly between $50,000 and $75,000 a year.
Robert Perunko and his wife, of Gurnee, Illinois, are feeling the pain.
Perunko drives a 2007 Toyota Corolla with more than 200,000 miles.
Here’s what McQueary had to say about the Perunko family’s plight trying to survive in Illinois:
He sold his motorcycle to manage mortgage payments, put off new windows on the family’s Cape Code-style house and started changing the oil on the car himself to save money. Family members eat meals at home. They bring their lunches to work. A recent splurge? Taking their young son to see the movie ‘Coco.’ That’s it.”
The property-tax bill on the Perunkos’ modest home, valued at $210,000, is $6,000 a year, or $500 a month. In Tennessee, homeowners pay property taxes of $500 a year for a nicer home with a swimming pool.
The Perunkos also pay more than $4,000 in state income taxes, and would have at least another $900 tacked onto that bill under the graduated income tax being proposed by the Democrats. In Tennessee, residents have no state income tax deducted from their payroll checks.
So it’s no surprise that the Perunkos are looking to escape Illinois. They have been house shopping south of Nashville, where new subdivisions are sprouting like mushrooms in once-empty fields.
“I am old and wise enough to know the difference between being male and being a man,” Perunko says. “As such, having Democrats and (House Speaker Michael Madigan) stealing the very quality of life and ability for me to raise a family, our child … as a man I can’t tolerate that.”
Yet, as McQueary aptly notes, so many others will tolerate it. “So many Illinois voters will buy into the rhetoric that more money through a graduated income tax will solve Illinois’ problems. It won’t. It will drive taxpayers away, many of them south.”
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Anthony Accardi is a reporter for The Tennessee Star.
[…] growth is propelling balanced budgets and job creation. As a result, the Chicago Tribune reports an unprecedented flight of middle-class working families out of Democrat-controlled Illinois into Tennessee, Florida and […]
And the ‘real’ problem will come when Illinois becomes insolvent and CANNOT pay its financial obligations. At that time (maybe very soon) it and other States like it (e.g., California et al.) will demand that the U.S. Congress enact some form of ‘bail out’ to pay these obligations (e.g., probably state and city PENSIONS for the members of their state Dem political ‘machine,’ and not the current day-to-day operating expenses of the State, although there may eventually also be a ‘demand’ that at least some of those obligations be paid too) and then pressures will be brought to bear upon states like Tennessee to pay for Illinois’ et al. financial profligacy.
That is when the choices that Tennesseans make in this year’s congressional elections will become crucially important with respect to this interstate issue. Will the decision be made by the Congress that some form of bankruptcy protection be enacted for these financially irresponsible states (i.e., that these obligations be fully extinguished—that is, that the pensions be terminated) OR will the decision be that the financially responsible states of the Union, like Tennessee, MUST now ALSO help fully pay these obligations of the profligate states?
What would Bredesen vote to do in the U.S. Senate vis-à-vis Blackburn? (Everyone knows what the Dems in other states like New York, New Jersey, Massachusetts, Connecticut, Rhode Island, Vermont, New Hampshire, Maine, Michigan, Minnesota, Oregon, and Washington, and also probably Ohio and Pennsylvania, etc. will demand be done.) We all know the answer to that question.
Be careful Tennesseans how you cast your vote in this year’s congressional elections.
Um… California has a budget surplus is nothing like Illinois. Please watch something other than Fox News: https://www.wsj.com/amp/articles/jerry-browns-legacy-a-6-1-billion-budget-surplus-in-california-1515624022
California estimates that it will have a budget surplus for its 2018-2019 budget year of $9 billion.
BUT WHILE CALIFORNIA IS NOT BANKRUPT, CALIFORNIA IS INSOLVENT. CALIFORNIA’S LIABILITIES VASTLY EXCEED ITS ASSETS. CALIFORNIA HAS A CURRENT UNFUNDED PENSION LIABILITY ESTIMATED BY SOME TO BE HALF A TRILLION DOLLARS.
AND ACCORDING TO A DECEMBER 2017 PUBLISHED REPORT OF THE AMERICAN LEGISLATIVE EXCHANGE COUNCIL (ALEC.ORG) THE HALF A TRILLION DOLLARS AMOUNT IS ON THE ‘LOW’ END. ALEC ESTIMATES THE AMOUNT FOR CALIFORNIA TO BE ALMOST ONE TRILLION DOLLARS ($987,774,192,764 in 2017, and getting larger every year, $956,081,787,553 in 2016). OTHER GROUPS HAVE ESTIMATED THE CALIFORNIA CURRENT UNFUNDED PENSION LIABILITY AMOUNT TO BE AS HIGH AS 1.3 TRILLION DOLLARS. AND CALIFORNIA IS BUT ONE OF SEVERAL STATES WITH SIGNIFICANT PUBLIC EMPLOYEES UNFUNDED PENSION LIABILITY, AGGREGATELY TOTALLING ABOUT 6 TRILLION DOLLARS. AND, OF COURSE, STATES HAVE OTHER KINDS OF UNFUNDED LIABILITY BESIDES PENSION LIABILITY.
To place these numbers in context, the ENTIRE U.S. Gross National Product is currently estimated (there are several reputable evaluating groups with varying estimates depending on what they include and exclude) to be between $19 Trillion and $23 Trillion annually.
It would seem that a large contingency from Chicago has already arrived based upon the number of shootings and murders reported in Nashville. “Dear” Nashville Politicians, thank you for screwing up a decent city with your push to grow at any cost. It looks like it is really going to be expensive in terms of murders and living costs.
I sincerely doubt any “shootings” in Nashville has anything to do with former Chicagoan’s who are fleeing the tax burden in their native state. Unless they were homeowners who resorted to sticking people up to pay the exorbitant taxes in Illinois.