“HEY, THIS IS A DANGEROUS NEIGHBORHOOD. WHAT YOU NEED IS A LITTLE PROTECTION, YOU KNOW, INSURANCE AGAINST BAD THINGS HAPPENING TO YOUR LITTLE STORE"

11/6/11

It was bad enough when Governor Pat Quinn (no relation) and his fellow travelers in the state legislature increased the state income tax on individuals and corporations (though, as I said in my 1/7/11 post YOU MEAN ALL THAT STUFF GOVERNMENT DOES TO US ISN’T FREE?!, it would have been more fiscally realistic if those who screamed so loudly about the tax hike had used a little of that enthusiasm, and volume, when the spending that ultimately necessitated at least some form of tax hike was being done with reckless, carefree abandon and perhaps had given a touch more consideration to whom they were voting for than to the latest prospects on “Dancing With the Stars,” but I digress), the workings of the fisc in the Land of Lincoln have gotten progressively worse.

Predictably, those corporations that are large enough or politically connected enough (A large area of intersection exists between these two characteristics, as you might guess.), such as Sears, the CME, Caterpillar, etc., are appealing to their friends in Springfield and, voila, getting their tax bills reduced. So we have a situation in which life is made burdensome for the typical business in Illinois, but those who play ball, especially with their checkbooks, with the pols who inflicted these burdens upon them can have their burden mysteriously lightened. It’s the old protection racket, though this time not practiced by Machine pols who control various inspection processes or by enterprising ethnic businessmen who have no compunction about applying innovative and creative means of persuasion, but, instead, by our crusading goo-goo governor and his partners in extortion in the legislature. The typical businessperson, generally apolitical and just trying to stay in business and make a living roughly commensurate with the effort and the investment he or she expends, gets stuck with the bill and suddenly learns the downside of staying apolitical in this increasingly dystopic state. The message becomes clear: play ball with the pols, especially when they expect you to express your gratitude with your checkbook, or be forced to live under the conditions they, who have not the slightest clue as to how to conduct actual, for profit business, impose upon you, the economic engine of this state.

The situation outlined in the last paragraph would be bad enough, but it gets worse. It seems that, according the Chicago Sun-Times (Saturday, 11/5/11, page 9), the governor and the “four legislative leaders,” a description that presumably includes the two GOP leaders, “have settled on a framework” to finance the tax reductions for the likes of the CME and Sears. The framework involves decoupling the federal method of expensing equipment purchases for tax purposes from the state method of expensing such purchases for tax purposes. Currently, federal law allows certain companies to immediately expense the purchase of long lived equipment and the state of Illinois, in the interest of simplicity, allows those same companies to treat the expensing of equipment in the same way. But under the “framework” that the thugs in Springfield are going to put before the rank and file legislators, the state will require equipment purchases to be depreciated; i.e., charged against income at (hopefully) decreasing rates over a number of years. This seemingly arcane change in the state tax code will cost Illinois businesses $570 million. This is in addition to the additional spondulicks the increase in the state tax rate will require them to hand over to Governor Quinn (no relation) and his henchmen. (There is always the question of who the super-villain is here and who are the henchmen, but, for purposes of this post, we’ll go with Quinn being the arch-villain and the legislators being the henchmen. This does not reflect the reality of the way things are done here, but it does reflect the relative degrees of enthusiasm, in most cases, for taxing the businesses of Illinois. But I digress.)

So now we have the typical Illinois businessman forced to pay a higher income tax rate while large and politically connected businesses get at least something of a pass. In addition, the typical Illinois businessperson will be forced, by means of a $570 million tax increase, to pay for the pass given those large and influential businessmen. This can’t be right, can it? Perhaps the article I am citing does not have it right, because this “framework” seems akin to the practice of various totalitarian governments throughout history of having the families of those executed pay for the bullets (or gas, rope, or electricity) used in political executions and/or clean the area in which their family members were beaten and tortured of blood, body matter, and other detritus of the dictatorships’ cruel methods of enforcing adherence to their view of the world.

Note further that, if the Sun-Times article is correct, the ostensibly free market and/or pro-business GOP leadership is going along with this exercise in political coercion and enlightening benighted businessmen to the virtues of making sure that the pols enjoy a healthy portion of the fruits of their hard work. While the grassroots GOPer may mean it when he or she says she believes in free markets, the GOP leadership in this state, and in much of the country, is just another flavor of busybody, know-it-all politico.

While I am sure there are people out there who love this state and living in this state more than I do, there aren’t many of them. But even I am starting to wonder why anyone, at least anyone who manages and/or owns a business, continues to live in the Land of Lincoln.