October 15, 2011

Unlike Wis. and Ohio, Illinois, the Democrat ‘Deadbeat State,’ Gets Little Media Attention

IllinoisMapSometimes it’s really hard to understand why certain events get heavy national press coverage while others which are arguably at least as significant and serious get little if any notice. This is one of them. Scott Walker, who solved a $3 billion projected deficit in Wisconsin, is a media and leftist (but I repeat myself) arch-villain because much of the balancing was done by adjusting public-sector employee contributions towards health and pension benefits to more closely but still more generously resemble what’s seen in the private sector, and by reducing public-sector employees’ ability to restore them to their formerly out-of-control levels through collective bargaining. Ditto for John Kasich in Ohio, where the projected deficit was $8 billion.

Meanwhile, the state of Illinois defers billions of dollars of payments to vendors by four or more months because, despite 67% and 46% increases in personal and business income taxes, respectively, it still doesn’t have the money to come even close to staying current. Yet virtually all we’ve see from the national press on the problem is one Associated Press story conveniently filed on a Saturday. Here are key paragraphs from the report by Christopher Wills (bolds are mine throughout this post):

Deadbeat state: Ill. owes billions in unpaid bills

Drowning in deficits, Illinois has turned to a deliberate policy of not paying billions of dollars in bills for months at a time, creating a cycle of hardship and sacrifice for residents and businesses helping the state carry out some of the most important government tasks.

Once intended as a stop-gap, the months-long delay in paying bills has now become a regular part of the state’s budget management, forcing businesses and charity groups to borrow money, cut jobs and services and take on personal debt. Getting paid can be such a confusing process that it requires begging the state for money and sometimes has more to do with knowing the right people than being next in line.

As of early last month, the state owed on 166,000 unpaid bills worth a breathtaking $5 billion, with nearly half of that amount more than a month overdue and hundreds of bills dating back to 2010, according to an Associated Press analysis of state documents.

The true backlog is even higher because some bills have not yet been approved for payment and officially added to the tally. This includes the Illinois health care agency, which says it is sitting on about $1.9 billion in bills from Medicaid providers because there’s no money to pay it.

… The unpaid bills range from a few pennies to nearly $25 million. In early September, for example, Illinois owed $55,000 to a small-town farm supply business for gasoline, $1,000 to a charity that provides used clothing to the poor, $810,000 to a child-nutrition program.

… Illinois leaders join in bemoaning the crisis but haven’t been able to find a solution.

“God, how much more can our people take?” said Comptroller Judy Baar Topinka, a veteran politician responsible for trying to pay a seemingly infinite stack of bills with the finite amount of money approved by legislators and the governor.

(Former Governor Rod) Blagojevich’s replacement, Democrat Pat Quinn, raised income taxes and trimmed spending, but that money was gobbled up by other needs, primarily rising pension costs. Under budget agreements with legislative leaders, all Democrats, bills continued to go unpaid.

As noted above, the tax increases were incredibly steep — yet nothing changed with vendor payments. Ohio and Wisconsin balanced their budgets without raising taxes — and their governors are really, really, really bad guys.

As a reminder, the people of Illinois were specifically told that the vendor payment problem would be solved by the latest round of tax increases:

“We have just come through the worst economic crisis in our lifetime…and we have not paid our bills,” Senate President John Cullerton, D-Chicago, told lawmakers shortly before the vote. “We are going to have to cut…even with this tax. We’re going to have to spend less money then we have in the last two years. And it’s going to be tough. But we are going to have our bills paid.”

Obviously, that hasn’t happened, and there is no realistic prospect that it will happen. Givebacks subsequent to the tax increases by the state’s public-sector unions were almost non-existent. At the time of the tax increases, Governor Quinn thought he could prove that his state’s way of “fixing” things would be as effective as Wisconsin and Ohio and would cause less pain for everyone. How’s that workin’ out for you now, buddy?

Demonstrating its usual lack of class, the wire service which so often fails to identify a person’s political party affiliation in circumstances involving Democrats involved in crime or scandal chose to run an accompanying photo not of Quinn but of Ms. Topinka, and made sure to tag her as a Republican — as if the state’s comptroller has power to do anything about the decrepit situation the state’s Democratic governor and legislature have handed her.

Do you think the mess in Illinois would remain so relatively invisible if the state decided to wait 90 days or so to pay its employees so that vendors and employee alike would be on an equal footing? How is seriously delaying payments to independent contractors, consultants, small and large businesses, and small or large not-for-profits any different? It’s really not. So why is it getting so little attention? Why should I not believe that the reason has a lot to do with Quinn’s and the legislative majority’s political party, and the fact that tax-and-spend is really working out to be tax-and-bankrupt?

Cross-posted at NewsBusters.org.

MIA: AP Coverage of Dour Consumer Sentiment Report

Yesterday, Joe Weisenthal at Business Insider reacted to the mixed economic news of the day by observing: “Lots of folks are scratching their head about today’s dismal UMich/Reuters consumer sentiment number coming in so ugly, just as retail sales for September came in so strong.”

It seems that the folks at the Associated Press were not among the head-scratchers. From all appearances, the self-described Essential Global News Network, whose acronym might as well stand for “The Administration’s Press,” didn’t cover the consumer sentiment story at all. What follows are several paragraphs from Alex Kowalski at Bloomberg News describing just how ugly it was, complete with the “U-word” we’ve all come to know and laugh at (bolds are mine throughout this post):

U.S. Michigan Consumer Sentiment Index Unexpectedly Falls

Confidence among U.S. consumers unexpectedly dropped in October as Americans’ outlooks for the economy and their finances slumped to the lowest level since 1980.

The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 57.5 this month from 59.4 in September. The median estimate of economists surveyed by Bloomberg News called for a reading of 60.2. The gauge of consumer expectations for six months from now, which more closely projects the direction of consumer spending, dropped to 47, the lowest since May 1980.

Consumers may be questioning the recovery’s durability as incomes stagnate, home prices fall and policy makers debate ways to strengthen the recovery. Faster job growth may hold the key to bigger gains in consumer spending that accounts for about 70 percent of the economy.

… The difference between the median projection and the actual figure was the biggest in percentage terms since November 2010.

Searches on “Michigan consumer” and “Thomson consumer” (not in quotes) at the AP’s main site return nothing relevant and nothing at all, respectively.

A different search: A Google News search for the last 24 hours on [consumer thomson "associated Press"] (input exactly as indicated between brackets, sorted by date) returns only one item. Again, there is no evidence that AP covered the consumer sentiment story.

In a brief cruise through the Google News archive, I was able to find that the wire service mentioned the Thomson/U of M survey in July, October 2010, and September 2010.

About two hours after the consumer sentiment news was released, AP Business Writer David McHugh did find time to write up the relatively good news about retail sales:

Stocks pushed higher Friday as better than expected U.S. retail sales data and positive corporate news overshadowed fears from Europe’s debt crisis.

U.S. retail sales for September rose 1.1 percent, ahead of 0.7 percent market expectations. That indicated to some that the world’s largest economy might not be in as much trouble as feared earlier.

The consumer sentiment news says otherwise. It’s hard not to conclude that McHugh and his employer didn’t want to pass on anything that might dilute the positive retail news.

Cross-posted at NewsBusters.org.

Saturday Off-Topic (Moderated) Open Thread (101511)

Filed under: Lucid Links — Tom @ 8:22 am

Rules are here. Possible comment fodder MAY follow later. Other topics are also fair game.

Positivity: Rio’s ‘Christ the Redeemer’ monument turns 80

Filed under: Positivity — Tom @ 7:00 am

From Rio de Janeiro:

Oct 12, 2011 / 08:00 pm

On the same day that Brazilian Catholics honor their patroness, Our Lady of Aparecida, the country is celebrating Oct. 12, 2011 as the 80th anniversary of Rio’s famous “Christ the Redeemer” statue.

“The monument is an icon of Rio de Janeiro,” said Rio’s Archbishop Orani João Tempesta.

He said the statue “represents the Brazilian citizen: as a person who follows Jesus Christ, and welcomes others, as the monument does with its open arms.”

Rio de Janeiro’s inhabitants are not the only ones celebrating the statue’s 80th year. Believers throughout Brazil feel blessed by the presence of the Redeemer atop Mount Corcovado.