Archive for January 8th, 2008
January 8th, 2008
Edward Boss, an economist for the General Assembly’s fiscal agency, reviews economic indicators in a recent report and predicts little to no growth:
As shown, even the most likely scenario shows the economy recording no, or zero, growth in the final three months of 2007 while the next most likely, hard landing scenario, shows the economy declining for three consecutive quarters through the first half of 2008, clearly a recession, before a weak recovery occurs in the second half of the year.
Boss continues with a parallel to a 1970s economic slump:
Not only is there concern over the weakening pace of economic growth, but it is occurring at the same time that prices have shown an accelerated pace of increase. This combination suggests a period of “stagflation”, the worse of both worlds as the economy stagnates while inflation increases, and the unemployment rate rises. The term stagflation described conditions in the 1970s. Inflation seemed to feed upon itself as consumers began to anticipate continuous price increases and increased spending. In return, this increased demand pushed up prices further, which led to higher wage demands, labor contracts that included cost of living increases, and government that pegged entitlement spending such as social security payments to increases in the consumer price index. The later increased government spending swelled the budget deficit that pushed up interest rates that increased costs for business and consumers even further. Together with high energy costs and interest rates, business spending weakened and unemployment rose.
Nationally, unemployment is on the rise. Local unemployment, in particular, is near 6 percent. More on local unemployment here.
January 8th, 2008
If polling was any clue, Obama was supposed to sweep New Hampshire with Clinton’s beleaguered campaign.
Here’s an overview of New Hampshire polling, which showed Obama with a decisive lead (more than 10 points in some instances) in major polls.
Here’s more data showing Obama’s lead heading into Tuesday’s New Hampshire primary, coupled with an analysis. Even Clinton’s own team feared a loss is the nation’s first primary state.
What happened? Clinton won New Hampshire on Tuesday, despite all that data pointing to her imminent political death. More here.
It’s tempting to say Clinton surged thanks to publicity surrounding her notorious crying incident. Maybe this was a factor, but it’s hard to imagine she jumped more than 10 points in one day thanks to a single well publicized but momentary display of humanity.
Perhaps, as this writer suggests, voters responded to a Clinton campaign that finally, belatedly, appeared to recognize that people want a candidate who actually seems interested in engaging them. They don’t want a robot.
January 8th, 2008
Don’t bet on it.
Back in November, we reported that Gov. Rod Blagojevich’s administration was spending its Medicaid dollars as if there would be no tomorrow:
Meanwhile, the administration is spending its Medicaid dollars at a fever pace. Lawmakers appropriated $6.9 billion for Medicaid spending through June 30, the end of this fiscal year, said Carol Knowles, spokeswoman for state Comptroller Dan Hynes. But by Nov. 8 — roughly one-third of the way through the fiscal year — the state’s health-care agency had spent 45 percent of that money, she said.
“It has been common for that agency to run out of appropriation authority sometime in the spring,” she said. “But at the pace that the agency is going, it likely will run out earlier than ever before.”
By the end of the first quarter of the fiscal year, it turned out, the administration had killed off 37.6 percent of its annual Medicaid appropriation, according to a new report from the comptroller’s office. The comptroller’s office processes checks to state vendors.
But the comptroller’s new report also shows that the administration’s Medicaid spending appeared to slow during the second quarter, which ended Dec. 31.
However, the pace of Medicaid
grant spending slowed dramatically in the second
quarter and as a result, is up just $303 million
or 8.7% compared to the first half of last
fiscal year. Appropriations for fiscal year 2008
Medicaid grant spending of $6.894 billion are
up $345 million or 5.3% over the prior year.
Through the first half of fiscal year 2008,
53.2% of Medicaid appropriations were
expended compared to 52.0% in the first half
of last fiscal year.
In other words, as the first half of the fiscal year closed, the administration had spent roughly 53 percent of its annual appropriation. That’s more than half, but it’s only slightly more than half. Compared to November, the fiscal prognosis doesn’t look so bad.
“I would point out that the pace of spending was quite rapid until it was made publicly known how quick the pace was occurring,” Knowles told me by phone on Tuesday. “And since that was made public, virtually the only Medicaid expenditures/requests for payments have been basically expedited payments.”
She continued, “We estimate there is about another $1 billion worth of bills over at the (administration’s public aid agency) that have not been forwarded to us.”
In other words, the administration is holding plenty of bills from health care providers and not submitting them for payment.
January 8th, 2008
Lt. Gov. Pat Quinn seems to call for the public — rather than on legislators — to decide on every major issue that comes before the General Assembly, and Rep. Lou Lang has had enough.
During the House Gaming Committee hearing, Quinn’s lawyer, Sean Vinck, relayed the lieutenant governor’s wishes to have the public vote on the massive gambling proposal via referendum during the next election.
Quinn first burst onto the political scene in the 80s when he started a grassroots movement to reduce the size of the state Legislature and has led various other protests since. More recently, he has protested the Ameren electric rate hikes by calling on citizens to include a teabag with their monthly bills.
Lang, D-Skokie, deadpanned his response and asked Vinck if the lieutenant governor believes Illinois should ask the voters to decide every major issue, and proceeded to rattle off a long list of potential topics.
Vinck responded, seemingly unmoved by the sarcasm, by reaffirming the lieutenant governor’s longstanding belief that Illinoisans should have the power of citizen initiative to place any question on the ballot.
January 8th, 2008
School superintendents perked up today over a short paragraph buried inside a 459-page gaming bill.
Naturally, the portion of House Bill 4149 giving school officials the most heartburn is not the part that describes the gobs money (on page 54) schools would be poised to receive if the measure passes. It was the part that would require all school board members to undergo training for ethics and accountability (on page 140).
Steve Brown, spokesman for House Speaker Michael Madigan, said Rep. Kathleen Ryg, D-Vernon Hills, wanted the mandated training due to the influx of money schools could receive through the bill that would create three new casinos and also implement a new independent gaming commission.
Rep. Brent Hassert, R-Romeoville, said during the hearing that he didn’t remember school board training being discussed during negotiations.
Mark Metzger, vice president of the Illinois Association of School Boards, said during testimony that it is unfair for legislators to single out the state’s largest group of unpaid elected officials.
Metzger also said his association’s annual conference includes training and reaches roughly 85 percent of the state’s school board members.
Micahel McCreery, executive director of the Illinois Association of Superintendents of Schools, said at the very least, lawmakers should give the topic its full due by creating legislation to deal specifically with school board training.
Joe Alesandrini, vice president of Pekin Community High School Board, cut straight to the heart of the matter.
“Mandating training will not stop unethical behavior,” Alesandrini said today during testimony to the Illinois House Gaming Committee.
January 8th, 2008
School districts around Illinois aren’t the only ones waiting for money thanks to the state’s failure to finalize a budget implementation bill.
Secretary of State Jesse White also is waiting for $100 million — roughly 25 percent of his operating budget, an aide said Tuesday.
White spokesman Henry Haupt said the agency will make payroll on Friday but that employee paychecks will be delayed if the so-called BIMP is not approved by Jan. 25, the next pay date.
“All employees will be paid no matter what,” Haupt said.
The BIMP is a companion to the state budget, which Gov. Rod Blagojevich approved in August. Lawmakers sent the BIMP to Blagojevich on Nov. 5, but he waited until last Friday to veto it.
The governor has 60 days to act on a bill after lawmakers send it to him, or it automatically becomes law. Friday was day No. 60.
At issue for the secretary of state is a law authorizing the state to transfer dollars from its road fund to the secretary of state for operational costs. The BIMP modifies that law to increase that annual transfer from $30.5 million to $130.5 million — a difference of $100 million.
Lawmakers return to Springfield on Wednesday but it’s unclear when they will respond to the governor’s veto of the BIMP. If they can’t agree to either accept or reject the governor’s changes, the entire bill dies.
“We’re optimistic that the General Assembly will address the changes that the governor made in his amendatory veto,” Haupt said. “If and when that takes place, this issue will of course be moot.”
Another provision in BIMP would raise the foundation level, the minimum amount that schools must spend on each pupil, by $400 from $5,334 to $5,734. The foundation level drives general state aid to schools, particularly in districts with lower property values.
Until the BIMP is approved and the foundation level is actually changed, the State Board of Education says it will withhold $617 million in general state aid earmarked for schools.
January 8th, 2008
The presidential election cycle means it’s time once again for what?
Yep, you guessed it: Change, and lots of it. Little changes. Big changes. Narrow changes. Sweeping changes.
No, not that type of change.
This type of change. (Under Monday’s “New Videos,” scroll down to “Interview: Andre Sullivan”)
A candidate running for political office naturally promises change. Unless the candidate is the incumbent, in which case the candidate argues for the status quo. For a challenger, it’s all about change. Very, very exciting change.
That’s not to say the candidate necessarily delineates his or her proposed change in any meaningful, detailed sense. People get hung up on details. It’s better not to touch too many of them, in your standard candidate’s view.
God forbid, if you promise specifics, people may actually remember exactly what you promised. And hold you to it.
Yeah, we’re up for one big, fat change.
January 8th, 2008
Bill Clinton is not looking good these days.
I can’t say I’m surprised, what with the presidential campaign in full swing. Bill, of course, is cheerleader in chief for his wife Hillary.
Still, this image of Bill as a man exhausted and desperate can’t help his wife’s cause.
January 8th, 2008
The state’s fiscal woes continue, and that means continued delays for doctors, hospitals and other state vendors waiting for payments.
Illinois Comptroller Dan Hynes took the unusual step of posting this warning on his Web site.
Hynes says, ominously, “We do not anticipate that there will be sufficient GRF revenues to significantly reduce current payment backlogs for the near future.”
