The prognosis for Obama’s home state of Illinois is not good, according to this report by Fox News. Even the governor is calling the state a ‘banana republic’ at this point because, thanks to Democratic policies of the past, the state can’t pay their bills and is nearing bankruptcy:
FOX NEWS – Illinois is grappling with a full-fledged financial crisis and not even the lottery is safe – with Republican Gov. Bruce Rauner warning the state is entering “banana republic” territory.
Facing billions in unpaid bills and pension obligations, the state is hitting a cash crunch that is rare even by Illinois standards.
A top financial official just warned 100 percent of the state’s monthly revenue will be eaten up by court-ordered payments. Rauner is calling a special session of the Democrat-led General Assembly in a bid to pass what he hopes will be the first full budget package in almost three years.
“We’re like a banana republic,” Rauner said earlier this month, after the General Assembly failed, yet again, to pass a budget package by the regular session deadline. “We can’t manage our money.”
The governor has called for a special session starting Wednesday. The state so far is operating on a series of stopgap spending packages.
But the problems are years in the making, caused in large in part by the state’s poorly funded pension system— which led Moody’s Investors Services to downgrade the credit rating to the lowest of any state. The state currently has $130 billion in unfunded pension obligations, and a backlog of unpaid bills worth $13 million.
Reports have suggested the state could be the first to attempt to declare Chapter 9 bankruptcy — but under the law, that’s impossible unless Congress gets involved.
“Illinois is the fiscal model of what not to do,” Rep. Peter Roskam, R-Ill., told Fox News, while not commenting on the bankruptcy question. “This avoidance in behavior toward dealing with our challenges is what leads to the devastating impacts we are seeing today.”
Just last week, the Illinois comptroller, who is responsible for paying the state’s bills, warned the office would be paying out 100 percent of Illinois’ monthly revenue, leaving negative funds for “discretionary spending. ”
But the governor says Republicans have a way out of this mess:
But Rauner claims the Republicans have a new plan that could remedy the state’s crippling financial situation.
“Republicans in the General Assembly have laid out a compromise budget that I can sign,” Rauner said, calling it a “true compromise.”
The plan incorporates reforms like property tax relief, term limits, and spending caps, which have caused an “ongoing confrontation” between Madigan and the governor, one Republican leader told Fox News, adding that the two have been in a “stalemate” since Rauner took office two years ago.
Good luck getting that passed with the Democratic speaker, who claims Republicans aren’t making enough concessions or something. I guess he’ll wait until the state is completely bankrupt and it’s reputation is completely ruined to finally make the hard decisions.