Journal tomhudson's Journal: The collapse of Illinois 5
If you thought California was a basket case, Illinois has both feet in the grave.
The budget deficit in Illinois is almost as big as the one facing California, a financially beleaguered state that has triple Illinois' population
Illinois Stops Paying Its Bills, but Can't Stop Digging Hole
In Beardstown, a small city deep in the western marshes, Ann Johnson plans to shut her century-old pharmacy. Because of late state payments, she could not afford to keep a 10-day supply of drugs. In Chicago, a funeral home owner wonders whether he can afford to bury the impoverished, as the state has fallen six months behind on its charity payments, $1,103 a funeral.
In Peoria -- where the city faced a $14.5 million gap this year and could face an additional $10 million budget hole next year -- Virginia Holwell, a trainer of child welfare caseworkers, lost her job when the state cut payments to her agency. She sits in her living room high above the Illinois River and calculates the months of savings left before the bank forecloses on her house.
The Community Counseling Centers of Chicag - "Two weeks ago, I had days to meet my $420,000 payroll and all I was looking at was a $200,000 line of credit from a bank," recalled Mr. Troy. "I drove down to Springfield and said, 'Hey, you owe us $3 million.' They said: 'Oh, that's nothing. We owe another agency $10 million.' "
The state's Comptroller: In past years, when nonprofits needed credit lines to see themselves through tough budget times, the comptroller issued letters assuring banks that vendors would be paid. Not anymore. "I don't feel comfortable doing that," he said, adding with a shrug, "I mean, who knows, right?"
In other news, California state wages are supposed to drop to 7.25/hr., but the guy who's supposed to implement the cuts refuses to, despite a court ruling saying it's legal.
The outcome of stuff like this is obvious:
- increased misery, increased crime.
- people who can leave, will.
- more "walk-aways" and "jingle mail" mortgage defaults
- net result - the "donut effect" - but with vast sections of states becoming "inner cities".
Look for another 30%-50% home price drop in those and similar areas.
I'm glad ... (Score:2)
My state is in relatively good shape. Though to hear some people whine you'd think this state (WA) was some cross between California and Greece. Even if the initiative to repeal the junk food and soda taxes passes there is still room to make cuts before the state has to stop paying its bills. Yes further cuts will cause pain, but not to the dire straits some states are in.
Re: (Score:1)
WA kicks ass. Too bad our transportation infrastructure is so bad that it drives companies out of the state. :(
Re: (Score:1)
Whoops! It's the United States. We share the good. What makes you think you won't share the bad as well?
IL resident (Score:2)
The problem is IL has an extremely corrupt payola government. Dems keep getting elected because they get a combination vote from people on the take in one form or another and people who receive entitlements. The result is what we have now, the state spending significantly more than the revenue it takes in. The largest chunk of that spending is on entitlements such as excessive pensions for state employees and no-cost, frivolous benefits and services for low income residents. Notice I did not say "citizen
Hard times for Ill., but not for governor's staff (Score:2)
http://news.yahoo.com/s/ap/20100706/ap_on_re_us/us_illinois_governor_raises [yahoo.com]