Smiddy: On state finances

Originally Posted Online: Oct. 23, 2012, 12:59 pm
Last Updated: Oct. 23, 2012, 1:03 pm
Comment on this story | Print this story | Email this story
By Mike Smiddy

Our representatives need to be smarter about how the state does business. My opponent's proposal regarding Thomson prison is an example of where Springfield needs to make better decisions.
He suggested that it was a "necessary step" to give Thomson to the federal government for free and co-authored a proposal outlining the giveaway.
Thankfully, Rep. Rich Morthland's proposal was rejected, Thomson was sold at a fair price, and Illinois received a check for $165 million.
If Rep. Morthland's plan had become reality, Illinois would be $100 million poorer. This type of shortsighted, fiscally irresponsible decision needs to take a backseat to common sense and basic financial management. Illinois simply can't afford any $100 million giveaways.
We also need to take a look at what Springfield is spending on corporate welfare, like the Sears and Chicago Mercantile Exchange deals, that takes millions out of state coffers. My opponent voted to give Sears an $80 million tax break. Sears responded by closing stores and laying off employees across the state. It was a terrible investment for taxpayers. We need to be smarter about where our tax dollars go.
CME is the world's largest derivatives marketplace -- the place where commodities traders and financiers make their living. If Illinois can't afford to help low-income seniors purchase life-saving prescription drugs via the Illinois Cares Rx program (which was recently eliminated), we certainly can't afford to subsidize a wealthy stockbroker's second BMW. We need to save our tax breaks for middle-class families and small businesses.
Giving special treatment to large companies at the expense of the taxpayer and to the disadvantage of small business just isn't good economic policy. Eighty-five percent of employers in our district have 100 employees or less -- these are the businesses that create the most growth and need our attention.
The Responsible Budget Coalition has identified five corporate tax loopholes that take nearly $696 million out of the pockets of Illinois taxpayers. For example, if Illinois were to stop exempting dividends paid by foreign corporations to their U.S. parent companies, state revenue could increase by $320 million-$386 million. Since these companies don't pay state taxes on foreign dividends, this loophole actually incentivizes companies to leave the country. This is a loophole most people in Illinois have never heard of and will never benefit from -- removing it adds hundreds of millions in revenue and helps keep good jobs in Illinois. In aggregate, eliminating this loophole and just four others could help Illinois pay nearly $700 million in outstanding bills.
With these steps -- better financial decisions, less money poured into corporate tax breaks and ending egregious and unproductive corporate tax loopholes -- Illinois will have the money it needs to pay its vendors, school districts, police and fire personnel and other financial obligations.
I believe that the state income-tax increase needs to expire when it is scheduled to do so. Illinois must keep the promises it makes to its citizens, its taxpayers and its businesses. This increase disproportionately harms small businesses which don't have access to the huge tax breaks that large corporations often receive.

Mike Smiddy, of Hillsdale, is the Democrat candidate in Illinois House District 71.


Local events heading

  Today is Tuesday, Sept. 16, the 259th day of 2014. There are 106 days left in the year.

1864 — 150 years ago: A fine lumber mill is on the course of erection at Andalusia. A flouring mill at that location is doing a fine business.
1889 — 125 years ago: J.B. Lidders, past captain of Beardsley Camp, Sons of Veterans, returned from Paterson, N.Y., where he attended the National Sons of Veterans encampments.
1914 — 100 years ago: President Wilson announced that he had received from the imperial chancellor of Germany a noncommittal reply to his inquiry into a report that the emperor was willing to discuss terms of peace.
1939 — 75 years ago: Delegates at the Illinois Conference of the Methodist Church in Springfield voted to raise the minimum pay of ministers so that every pastor would get at least $1,000 annually.
1964 — 50 years ago: An audience of more than 2,600 persons jammed into the Davenport RKO Orpheum theater with a shoe horn feasted on a Miller-Diller evening that was a killer night. Phyllis Diller sent the audience with her offbeat humor. And send them she did! It was Miss Diller's third appearance in the Quad-Cities area.
1989 — 25 years ago: A few years ago, a vacant lot on 7th Avenue and 14th Street in Rock Island was a community nuisance. Weeds grew as high 18 inches. Today, the lot has a new face, thanks to Michael and Sheila Rind and other neighbors who helped them turn it into a park three weeks ago.

(More History)