A rookie mistake has led to some big problems.
House Speaker Michael Madigan and Senate President John Cullerton both believed that Gov. Bruce Rauner would ask to postpone the scheduled Feb. 18 budget address.
The current fiscal year’s outlook was so incredibly dire (by the Democrats’ own making), that the veteran Democratic leaders figured Rauner would want to first tackle that problem before moving on to the mess in next fiscal year’s budget, which begins July 1.
Rauner declined, declaring that a deadline was a deadline.
He should’ve asked for a delay.
Rauner claimed during his budget address that a deal on the current fiscal year’s problem was just “days away.” Speaker Madigan agreed with the governor’s prediction immediately after the speech.
In reality, though, the governor’s address undercut his negotiating stance so badly that Senate President Cullerton told Reuters two days later that the negotiations had gone completely off the rails.
The problem is very real and twofold.
First, Democratic legislators were open to giving the governor wide authority to move money around in this fiscal year’s budget to patch the gaping holes that they themselves caused last year when they passed the monster after failing to come to terms with the reality of the expiring income tax hike.
But then Rauner revealed that he wanted to do pretty much exactly the same thing in the coming year’s budget in next year’s, and the bitter pill of those cuts woke legislators up to some very harsh realities.
By now, you know the litany. Slashing municipal revenue sharing in half, eliminating a $165 million state heating assistance program funded by utility ratepayers, cutting higher education’s funding by 31 percent, seriously chopping Medicaid reimbursements to hospitals, pharmacies and nursing homes, not to mention the long list of cuts to relatively tiny social service programs added by individual legislators over the years.
Democrats reacted by saying they might be willing to allow Rauner to do some of that this fiscal year, but letting him do it again next fiscal year would be dangerously close to making those drastic cuts permanent.
Secondly, Rauner failed to even mention the possibility of new revenues during his address. By law, the governor cannot base a budget proposal on revenues which don’t yet exist under state statute. But there’s nothing in the statute books barring him from at least mentioning a few revenue options that he could live with.
For example, Rauner said repeatedly during the campaign last year that he wanted to eliminate corporate tax loopholes and put forward a modest plan to tax some services. He also adeptly refused to rule out the prospect of raising the income tax back up a bit before walking it down over four years.
Some still hope that the governor is open to those ideas and may not have mentioned them as part of an ongoing negotiating posture of forcing Democrats out of the weeds.
That may well turn out to be true, but Rauner planted himself so firmly on the far economic fringe with his budget address that he gave the distinct impression of policy immobility. Instead of coming off as a bipartisan leader, he looked like an intractable hardliner. His proposed sacrifices were completely one-sided – the poor and downstream governments bore pretty much the entire brunt. The rich and well-off were asked for nothing.
What we have here are two seemingly diametrically opposed philosophies. On the one hand, Rauner wants to permanently cut sacred cow programs to start aligning state revenues with state expenditures. And he was possibly silent on new revenues as a way to force the Democrats to make the first move on that front.
On the other hand, the Democrats see Rauner’s deep and drastic cuts as an irresponsible way to fund an unaffordable Jan. 1 income tax reduction which mainly benefits the well-off. And they want the governor to propose some revenue ideas before they’re willing to entertain any cuts to this fiscal year’s budget or next.
In other words, while Rauner’s budget was most definitely a punt to the General Assembly, the legislative Democrats appear to have just punted the ball right back to the guy. Show us some revenue alternatives, they’re saying, and maybe we’ll talk. But you go first.
So, if the rookie governor had just put off that budget address by a couple weeks or so, he might have solved this fiscal year’s very real problems and survived to fight another battle over next fiscal year’s problems. Instead, we’re looking at possible gridlock.
Rich Miller also publishes Capitol Fax, a daily political newsletter, and CapitolFax.com.