Voting With Your Feet

My mama used to say, "The apple doesn't fall far from the tree." She correctly observed that often out-of-control kids had families that were dysfunctional. That aphorism is particularly true in politics. If you want to understand President Obama, just take a peek at the state that provided him his training and background.

Illinois is an absolute fiscal catastrophe. One survey had it rated the 2nd worst run state. A Forbes survey just ranked Chicago as the 6th most miserable city (but evidently committed to being number 1.

It's an open secret that Illinois is in the top ranks of corrupt state, lavishing state workers and unions with fat paychecks and even fatter retirement benefits. The Chicago Tribune has had several investigative articles about favored individuals being put on payrolls for minimum periods simply to get retirement benefits. And, if you lose and election, like Dan Seals (an unemployed guy before losing to Robert Dold in the 2010 congressional election), not to worry. Quinn put him on the Illinois payroll at a six figure salary to be an assistant director in the Department of Commerce and Economic Opportunity, a position for which I'm sure Mr. Seals is well-qualified.

All this largesse has come at a price. The state's pension funds are only 45% funded and Illinois is teetering on the brink. But, instead of addressing its spending binges, Governor Quinn and the Illinois legislature elected to crank up the tax man, increasing the state income tax by nearly 50% on indivuals, businesses and nearly doubing tolls. Increase taxes by 50% and you get 50% more revenues, right?

Well pols seem to forget that humans respond to incentives. The selfish beings that they are, they fail to respond to measures taken for the "common good" (translated: Democratic supporters). I don't have a full survey of the damage that the tax increases have done, but I have a bit of anecdotal evidence:

• Aon Corporation announced that it was moving its corporate headquarters to London. Think about that. A major corporation is going to undertake the expense, trigger a tax liability for its shareholders, and make some people move, to change its headquarters to London? When Great Britain is a tax haven compared to you, you're in real trouble.
• The Chicago Tribune has reported that people are taking all kinds of circuitous routes to avoid the tollway system. The Trib calculated that the increase in tolls will cost an average driver $750 per year. Again, the Dems smack the working man, the guy they claim to help.
• A friend of mind who has been working part time out of his Florida home office changed the proportion of time he spends there to comply with requirements to change his domicile to Florida. "F**k Illinois," he said flatly, "I'm not giving them any more. I work too hard and I have to think about MY retirement, not some union guy." I can only guess that there are thousands of people like him- smart, hardworking, industrious that will simply leave.
• At a roundtable of business executives recently, I posed the question to the group, "Assuming that you wish your children to be happy and prosperous, would you counsel them to stay in Illinois and if not Illinois, where would you suggest that they move to give them the best chance of that happening?" The answer to this two part question was unanimous--- NO! and Texas.

Quinn's response last week was to propose even MORE spending, leaving the Illinois legislature (not the most frugal bunch) scratching their heads. Similarly, in his State of the Union address, President Obama promised to use 1/2 of the money spent in Iraq to pay down the debt.

Democrats never stop their spending addiction. That's why raising taxes doesn't work. Tax $100 and they spend $125. And they forget that people change their behavior in response. They stop investing. They move. They avoid the roads. They buy less. They stop working. Economic activity dries up.

Quinn and Obama. Same guys. Same program for growth.