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Financial Fail: Illinois Among States in "Fiscal Peril"

By aaroncynic in News on Nov 12, 2009 6:20PM

Via the Pew's Report
Whether we’re hanging our heads at Chicago’s Olympic fail, shaking our fists at our state’s budget woes or rolling our eyes every time our former governor appears on a talk show, Illinoisans could at least take comfort in the platitude “it could be worse - we could be California.” Not so fast, says a new Pew Study. In a report titled “Beyond California: States in Fiscal Peril,” Illinois is rated one of the nine states “most like California,” meaning we’re teetering on the brink of fiscal ruination.

The report names Arizona, Rhode Island, Michigan, Oregon, Nevada, Florida, New Jersey and Wisconsin along with us as states facing similar fiduciary woes as California. It factors in high foreclosure rates, increasing unemployment and budget gaps, among other things. The Pew Center on the States based the study on data from July 31, 2009, which captures the first and second financial quarters along with state legislatures’ attempts to craft a 2010 budget.

According to “Beyond California,” “what puts Illinois squarely in the company of California is its lack of fiscal discipline to balance its state budget.” When California issued IOU’s rather than cut checks it was a sure sign of fiscal insolvency. Pew reports that Illinois simply ignores requests for compensation as “lawmakers put off paying bills.” When the money pit gets too deep, state lawmakers traditionally borrow money to pay our bills, but even that failed after the recession hit. Currently, the land of Lincoln owes an astonishing $3.9 billion, with no cogent plan to pay it off.

The data also shows our state has a 47.3% budget gap, a 10.9% drop in revenue from last year and a 3.5 point jump in unemployment. If that isn’t bad enough, Pew points out Illinois is a state where lawmakers “punt the responsibility.” Looking at the current solution to RTA budget woes, is it any surprise? We suppose we could hope for the 2010 election to bring in some fresh ideas to dig us out of this hole, but we’re not holding our breath.