By: Mark Glennon*
Reporters and politicians in both parties too numerous to name are calling the new Illinois budget “balanced,” and many are bragging about it. It passed the General Assembly today and Governor Rauner says he will sign it.
All budgets in the last ten years have been “balanced.” But here are actual results are for the last ten years, from the state’s audited financial statements:
That’s right, about $10 billion lost on average each year. That’s for all state funds. If you happen to be interested in the General Fund in particular, it was in deficit by $14 billion last year.
It’s not just the routine gimmicks used to cover up a billion or two dollars using phony budget accounting, though there’s plenty of that again this year that we already know about. Ted Dabrowski wrote here earlier today about some, and we’ll no doubt find more as we digest the 1,200 pages the General Assembly got only hours before voting.
The vastly bigger problem is accruals — running up bills with no way to pay, especially unfunded pension liabilities — that don’t show up in the budget. For further explanation, see our earlier article linked here.
It’s for that reason that the narrative itself is a lie.
Voters get overwhelmed with discussion about a budget hole of a couple billion dollars, which would be easily solvable, leaving them with no idea that our plunge into the abyss is proceeding at rate many times that.
What will the true loss be for the upcoming year covered by the new budget? That’s impossible to predict exactly because we don’t know things like how well pension fund investments will perform, but it’s safe to say it will be at least the average we’ve been seeing over the last ten years — $10 billion.
*Mark Glennon is founder and Executive Editor of Wirepoints.