By: Mark Glennon
Fifty million dollars! Impressive, no doubt, to the average voter.
That’s how much will go into Illinois’ rainy day fund — a reserve of sorts under Illinois’ budget for next year as proposed last week.
But check out Bloomberg’s article today, “Illinois Rainy Day Fund Almost Nil While Other States Hit Record.” Illinois has $59 million in its rainy day fund, it says. In contrast, U.S. states collectively held a record $74.9 billion in rainy-day funds at the end of fiscal 2019, the ninth-straight year of increases. States theoretically could run operations for a record median 27.9 days with those savings while Illinois has enough for less than one day, Bloomberg says.
The new rainy day contribution would be one-tenth of one percent of the proposed annual budget. Feeling more secure?
Similar story for the pensions, into which the budget would put $100 million more than required by current statute. That’s a lousy one percent increase, and still billions short of “tread water” funding levels for the pensions. That means that even if all the optimistic assumptions behind the pensions prove true, unfunded pension liabilities will continue to skyrocket.
Politicians of all political stripes know that voters are innumerate and most of them exploit it. That’s why I’m not naming our governor in this article, who proposed the budget. Most of his predecessors and decades of General Assemblies, whether otherwise radical or not, also knew the rule, which is part of why Illinois is in crisis. It’s from Saul Alinsky’s Rules for Radicals:
The moment one gets into the area of $25 million and above, let alone a billion, the listener is completely out of touch, no longer really interested, because the figures have gone above his experience and almost are meaningless. Millions of Americans do not know how many million dollars make up a billion.