Jump in inflation bails out Illinois politicians, punishes ordinary residents – Wirepoints

By: Ted Dabrowski and John Klingner

There’s a price tag attached to the unprecedented federal money lavished on states under the pretext of COVID relief, which is over $9 trillion and growing. It’s in addition to higher federal taxes that will be needed to pay for it. It’s inflation, which is finally getting the attention it deserves.

Illinois’ share of that federal funding – including all money sent to the state, local governments and the private sector – is a stunning $180 billion, according to the bipartisan Committee for a Responsible Federal Budget. People may not yet understand the connection between inflation and the cash being poured on their state and local governments, but they do know that inflation is now a major problem. A recent Pew Research poll found that inflation was Americans’ “No. 1 economic concern,” with nearly two-thirds saying they were “very concerned about rising prices for food and consumer goods.”

One group that’s been conspicuously silent about the issue are Illinois politicians. That’s because they are among the biggest beneficiaries of the federal government’s printing press. They love the billions of dollars flooding into Illinois – which paper over deficits and help inflate away the nation’s highest pension shortfalls.

Illinois politicians, past and present, are getting bailed out for their decades of failure, never mind that the scourge of price increases hurts ordinary Illinoisans.

Some inflation apologists in Washington brush off inflation as “transitory,” meaning they think the pace of inflation may diminish. That’s highly debatable, to put it mildly, but it also misses the more important point about harm already done to residents at the lower and middle end of the economic ladder. For sure, many Illinoisans are benefiting from stimulus checks and other benefits being pumped out in the short term, but in the long term inflation will be just another big tax on residents.

The harm being done is clear for all to see. Housing costs are up about 20 percent in the last year. Used car prices are up by almost 25 percent. Car rental costs are up 43 percent. Beef and other meat prices are up to 18 percent higher. And gas prices are up 50 percent. Those increases are for prices across the country, but you can bet Illinois’ increases are in the same range.

Overall, U.S. Labor Department numbers show that prices have risen 6.5 percent on an annualized basis so far in 2021. And core inflation rates have hit their highest level in 30 years.

 Illinoisans are among the least able to afford inflation

State and local governments have gotten trillions in federal stimulus money, a vast majority of which turned out to be entirely unnecessary after states’ rainy day funds and support from the CARES Act were taken into account.

For Illinois politicians, it’s been manna from heaven. Gov. J.B. Pritzker, Chicago Mayor Lori Lightfoot and Cook County President Toni Preckwinkle are spreading the stimulus funds across the entire state. The federal government is effectively funding their reelection campaigns as they massively expand spending programs and create new ones.

But the reality is the federal money is not free money. Everyone will eventually end up paying for today’s printing and spending spree through some combination of inflation, higher taxes and future cuts in services.

New spending by Pritzker, Lightfoot and Preckwinkle will only make things worse. There’s a severe shortage of workers, yet Lightfoot and Preckwinkle are pushing for their own form of Basic Guaranteed Income programs. Handing out that money to people for doing nothing will only further disincentivize going back to work.

While the impacts of inflation hit everyone across the country, Illinois in particular can’t afford to pile yet another cost onto the burdens its residents already face.

Illinois home values have already lost ground to inflation over the past 15 years with the 6th-worst home appreciation rate in the country. Property tax rates are consistently the first- or second-highest in the country. And most cities and counties are shrinking as a result of their depressed economies and worsening finances. Eighty-seven of the state’s 102 counties shrunk in the last decennial census count, worsening economic opportunities.

 If nothing changes, the problems in Illinois and across the nation will worsen.

Regardless, the spending train continues. Biden wants a $2 trillion spending bill – which is really $4 trillion – passed. So does Pritzker. Which is why Biden came to Illinois so the governor could spend time praising all the additional federal dollars coming Illinois’ way.

Politics may yet sink the massive federal spending bill, but we hope the reality of inflation will play a role as well.

Read more from Wirepoints:

16 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
streeterville
2 years ago

Illinois politicians are the greatest beneficiaries of that federal largesse because their pensions are guaranteed, as are the pension “give-aways” they granted to ensure staunch government employee union support of their reelections.

KJ
2 years ago

Inflation does not bailout government. Look at the 1970s. New York City went Bankrupt. Chicago was a ghost town.

Inflation stalls economic growth.

We are at the end of large government.

Mike
2 years ago

The Central Planners always believe the solution is yet another central plan.

nixit
2 years ago

Cue the pensioners complaining their 3% compounded COLA won’t cover inflation while ignoring the inflation rate over the past 10 years.

Last edited 2 years ago by nixit
Aaron
2 years ago
Reply to  nixit

Yea, they need more and they deserve it. In fact they deserve all your money. You didn’t build that. Government employees facilitated your entire life. In fact, democide Is good for you.

NoHope4Illinous
2 years ago

Biden will make Jimmy Carter look pretty good.

Zephyr Window
2 years ago

As the Potato Head president says, ” No one will pay one extra cent under my administration”. No Mr Potato Head, we will be paying dollars extra.

James
2 years ago
Reply to  Zephyr Window

My recollection says you are taking his remark about his tax proposal and implying it was meant apply to the eceimy generally. Nice try, bub, but no cigar is awarded to you for your input effort. The economy is controlled, generally speaking, far more by market forces only some of which are directly affected by the American politics of the moment.

ProzacPlease
2 years ago
Reply to  James

Your comment implies that policies do not affect economic outcomes, that is just the flotsam and jetsam of outside forces. If that is true, why do liberals push so hard to implement their ideas? But when it goes south, as it so obviously is, then liberals will accept no responsibility.

Liberals would be the first to proclaim how much their policies affected the economy if they had worked.

24% can read, 84% graduate. Aren’t we doing an awesome job?

Last edited 2 years ago by ProzacPlease
James
2 years ago
Reply to  ProzacPlease

I agree that politics has an influence on the economy, but overall market forces generally supersede politics in most ordinary circumstances. Wars and major events of the moment make politics take a more prominent role at times, of course.

Riverbender
2 years ago

I see Biden’s accomplishments at the gasoline pump every day.

Admin
2 years ago
Reply to  Riverbender

That alone is devastating for so many people. They get their paycheck, pay for gas, cell phone, rent, food and there is nothing left.

Freddy
2 years ago
Reply to  Mark Glennon

One more-Not much is left after paying property taxes. Don’t pay your property taxes and you lose your home. No money for food and you’ll starve. https://www.naturalnews.com/2021-10-20-red-alert-as-america-now-just-nine-meals-away-from-anarchy-massive-civil-unrest-provoked-on-purpose.html This article sounds like a future sci-fi movie but is already happening I went to my local Woodman’s last night and more and more empty slots are appearing like Chobani’s yogurt is nearly empty-single bottled water was a dime now 15 cent and more signs say Due to manufacturer’s/etc. The deli person told me her daughter works at a grocer in Colorado and it’s worse there. Supply chain is broken. Dark winter ahead.… Read more »

NoHope4Illinois
2 years ago

The PPI is over 10%. I have seen first-hand +20% increases in component costs. Q4 could be really ugly. People are hunkering down to pay for necessities. I want to hear from those establishment Republicans who ran a whisper campaign for Biden – what are the excuses now as the economy craters?

Joan
2 years ago

Something is horribly wrong with those inflation numbers too. It feels to me like prices have gone up 20 percent just this year. Some things are much more. It doesn’t seem like there has ever been anything like this.

KJ
2 years ago
Reply to  Joan

The government includes mortgage payments for inflation calculation. This keeps inflation down.

SIGN UP HERE FOR FREE WIREPOINTS DAILY NEWSLETTER

Home Page Signup
First
Last
Check all you would like to receive:

FOLLOW US

 

WIREPOINTS ORIGINAL STORIES

A statewide concern: Illinois’ population decline outpaces neighboring states – Wirepoints on ABC20 Champaign

“We are not in good shape” Wirepoints’ Ted Dabrowski told ABC 20 Champaign during a segment on Illinois’ latest population losses. Illinois was one of just three states to shrink in the 2010-2020 period and has lost another 300,000 people since then. Ted says things need to change. “It’s too expensive to live here, there aren’t enough good jobs and nobody trusts the government anymore. There’s just other places to go where you can be more satisfied.”

Read More »

WE’RE A NONPROFIT AND YOUR CONTRIBUTIONS ARE DEDUCTIBLE.

SEARCH ALL HISTORY

CONTACT / TERMS OF USE