By: Mark Glennon*
With Governor JB Pritzker’s annual budget address coming up next week, it’s a good time to step back and look at big picture basics.
Since 2001 Illinois has sunk $190 billion further into the red, or $10 billion per year.
That’s $27 million per day.
That’s $1.1 million per hour, every hour for nineteen years.
In every one of those years politicians from both parties claimed to have balanced budgets. Most will make the same claim again next week.
Why the disconnect between actual results and allegedly balanced budgets?
The actual results come from the audited financial statements after each year ends. The true loss is shown there as a decline in net worth. Real losses include worsening debt loads, particularly unfunded pension liabilities. Today, the state’s net worth stands at about negative $190 billion, which was reconfirmed in an interim report recently released by the Illinois Comptroller.
Yearly budgets, on the other hand, ignore debt and are loaded with other gimmicks to make lawmakers look responsible. Media are routinely suckered by budget numbers. They ignore actual results. Expect the same to happen next week.
For a simple, clear explanation of why budgets are nearly meaningless, watch this video from Truth in Accounting:
Read more about Illinois fiscal and budgetary crisis:
- Interim financial report shows Illinois lost another $3.7 billion in 2019
- Yes, the rich are fleeing Illinois and they’re taking billions with them
- Why an aging and shrinking Illinois is a threat to public sector pensions
- 250 new laws will greet Illinoisans January 1, but none slow the state’s steep decline