The headless horseman of Illinois politics

Ghost of Bruce Rauner’s austerity agenda rose up, financed by Ken Griffin, and rode roughshod over the state, but how did it sway voters and what does that mean going forward?

Gov. Bruce Rauner might be gone, but his austerity agenda rides on, bankrolled by his political contributors Kenneth Griffin and Richard Uihlein. (Flickr/Tom Simpson, art by Mary Blair)

By Ameya Pawar and Ted Cox

Wow, we didn’t see that coming.

Or maybe we did and didn’t heed our own warnings.

Not two weeks ago, we wrote about “the shadow politics” at play in the debate over the Fair Tax Amendment. University of Illinois at Chicago Professor Christopher Mooney pointed out that traditional Republican big-money political contributors Kenneth Griffin and Richard Uihlein were funding efforts to defeat the amendment, alongside state Supreme Court Justice Thomas Kilbride in his bid for retention.

The amendment required a 60 percent supermajority for ratification, just as Kilbride did for retention. And both went down in Tuesday’s election, with Kilbride drawing just 56 percent of support in the 3rd District running across the state from Will and Kankakee counties to the Quad Cities, while the amendment failed to gather even a simple majority statewide.

It shouldn’t be lost on anyone that Griffin bankrolled a ruthless, oftentimes fanciful TV ad campaign against the Fair Tax to the tune of $54 million, while giving another $4.5 million to Citizens for Judicial Fairness, an organization fighting Kilbride’s retention, which pocketed another $1 million from Uihlein, who likewise was a fellow contributor to the anti-tax campaign.

You may not monitor political contributions through Illinois Sunshine, and you may not even know who Ken Griffin is, but you no doubt saw the ads. And Kilbride became the first Illinois Supreme Court justice to lose a retention election.

What else is the fallout? In the midst of a pandemic that brought on a recession, state government will have to raise taxes on everyone through the flat tax or perhaps a tax on retirement income if it’s to balance its budget on its own, while Kilbride’s loss creates a 3-3 split on the state Supreme Court. It’s already been suggested that Griffin and Uihlein will fund a replacement candidate more amenable to rolling back state pensions.

This is the reanimated austerity agenda of former Gov. Bruce Rauner. Rauner might have left the state after losing to Gov. J.B. Pritzker two years ago, but his agenda rides on — like the mythical headless horseman — funded by Griffin and Uihlein, who helped bankroll his political career in the first place.

This really is Rauner’s agenda in a headless form. Force a flat-tax increase, spare the millionaires and billionaires, and then use the hardship brought on by that increase as leverage to press for cuts in state pensions, this time to be endorsed by a more agreeable state Supreme Court. The endgame here is busting pensions and gutting spending, no matter the expense to working families and social services.

“This really is Rauner’s agenda in a headless form. Force a flat-tax increase, spare the millionaires and billionaires, and then use the hardship brought on by that increase as leverage to press for cuts in state pensions, this time to be endorsed by a more agreeable state Supreme Court. The endgame here is busting pensions and gutting spending, no matter the expense to working families and social services.”

Or, as Professor Mooney put it two weeks ago: “This is a chance for the Republican Party to have a win in Illinois in 2020, the year they’re not going to have a lot of joy. But this is only because the party’s not on the ballot. … The reason they might have success here is nobody knows it’s their thing.” He suggested Republicans were flying “under the radar” on the Flat Tax Amendment.

“Between Trump and Bruce Rauner and demographic shifts in the state, the GOP as a competitive force in the state has really been decimated — and really ‘destroyed’ I think is not too strong of a word,” he added. “So this is an opportunity for them to have a win. … You have this hope for the Republican Party, but really it’s a very, very thin hope.”

So we thought.

The question is what now? If the state raises taxes on everyone, one solution might be to dramatically expand the Earned Income Tax Credit — say, to all incomes up to $100,000, and with real cash going back to people in the form of substantial rebates, perhaps distributed quarterly or even monthly to spur consumer spending. That will be critical as the state economy recovers from the COVID collapse, and it will serve much the same purpose as a graduated income tax, although it won’t ease the pain on those bearing the brunt of the tax hike.

What might serve that purpose is another COVID-19 federal relief package providing relief to state and local governments, especially if Joe Biden comes out on top of the presidential race when all the votes are counted. Barring that, or if a Republican U.S. Senate should balk at a relief package, Illinois and all states should lobby for relief from the Federal Reserve.

The bond-rating agencies — which have already threatened Illinois and Chicago with lower ratings if the Fair Tax Amendment fails — and the $500 billion Municipal Liquidity Facility created in a previous coronavirus relief package have, as we’ve said before, worked in cahoots to protect bond markets rather than provide actual relief to states and cities struggling to fill revenue holes from the COVID collapse. The best way to do that, in the absence of a major relief bill, would be for the Federal Reserve Bank to adapt the facility fund so that states and local governments can draw on it with repayment spread out over 20 or 30 years at minimal interest, perhaps at the same rate banks are getting from the Fed. Chairman Jerome Powell, for one, has appeared to welcome that larger role for the Fed in the pandemic.

Which still leaves us with the conundrum of what to do about Illinois.

One of the prime ironies of Tuesday’s election is that Chicago, which has many of the high-income taxpayers who stood to lose the most under a graduated income tax, voted in favor of the amendment, by 71.2 percent, while the rest of the state, which stood to gain the most from the additional tax revenue, voted against it.

Meanwhile, as Biden almost equaled the support Illinois native Hillary Clinton received in 2016 — at 55.1 percent, just under Clinton’s 55.8 percent — Trump actually increased his support from 38.8 percent to 43.1 percent. To many Illinoisans, that is unfathomable, given Trump’s relentless lying, his failure to lead on the pandemic, his support of white supremacist groups, and his authoritarian impulses (given free rein in the ongoing election controversy).

We have to be honest. If we’re trying to bring the state together, and more than 40 percent of the electorate votes for Trump, what does that mean to bring people together? Is it even possible?

One of us is a former elected official whose politics are well to the left, but does advocating progressive policies — such as public banking — actually add to the political divisiveness? How we establish consensus on issues like that and taxation is probably just as important as the issues themselves. If progressives are perceived as elite eggheads — a problem that runs back through Democratic politics at least to Adlai Stevenson, if not William Jennings Bryan — what is the solution? Chicagoans may have voted for the Fair Tax with the idea of telling the rest of the state, “Don’t you know how much this is going to help you?” Yet voters outside Chicago rejected that even as they sided with a billionaire clearly working in his own self-interest.

There’s a desire for self-reliance that runs heavy in the American ethos, combined with a firm resistance when that independence is threatened, and it readily plays into our politics at the intersection point between anger and money — namely, political advertising. The Fair Tax Amendment fell victim to that, as did Justice Kilbride and candidates running for office in both major political parties across the state.

By contrast, the reasonableness of TV ads backing a progressive income tax or, say, U.S. Rep. Lauren Underwood just doesn’t gain traction in the current political environment. Why not? We’re going to have to mull that for a while, just as all voters — the joyous and the disappointed — are taking their own lessons from the results.

We still insist that we rise and fall together, as a state and as Illinoisans, but how exactly do we get to lifting everyone up at this point? The only thing that seems clear right now is that we’ll all be paying higher taxes together.