Lawmakers in America hand out tax breaks to giant corporations with more than $80 billion each year, gifts intended to make their states and cities more attractive to companies. It’s a practice that has helped keep Illinois up to its neck in debt.
In a 2014 study, Subsidizing the Corporate One Percent, the nonprofit, nonpartisan research center Good Jobs First reported that three quarters of all such corporate tax breaks awarded and disclosed by state and local governments went to just 965 large corporations, most of them Fortune 500 companies. We examined this issue in further detail in the current edition of AFSCME WORKS.
The loss of revenue from such handouts often ends up hurting taxpayers where they live – in the loss of services, in closed libraries, in cutbacks to public service workers’ wages and benefits. In Illinois, Gov. Bruce Rauner decided that $100 million in business tax breaks promised to corporations by a previous governor must be honored. Meanwhile, taxpayers will get the shaft.
The governor agreed to suspend more than $200 million in grants for social services and parks to help make up the difference in his corporate giveaways. News reports, quoting the governor’s spokesperson, said the tax breaks were green-lighted “because they have no impact” on current-year spending.
No impact? That would be funny if it didn’t hurt so much. In every practical way, robbing the state coffers of much-needed revenue means that someone else has to make up the difference – or something has to be cut. So, out with $26 million in health and social services grant awards. Out with $180 million in parks grants – and the state still is running a multi-billion-dollar deficit next year.
“Since entering office,” says AFSCME Council 31, “Rauner has used the state’s fiscal woes as justification for his extreme agenda, which has focused on weakening union rights, gutting programs that help struggling families and slashing vital public services.”
When he refused to close the tax loopholes for eBay, CapitalOne and other corporations, Governor Rauner lost any chance of claiming cuts to public services was necessary.
“The governor’s willingness to put corporate welfare over people’s welfare is a matter of grave concern,” said AFSCME Council 31 Exec. Dir. Roberta Lynch, also an AFSCME International vice president. “His twisted priorities aren’t shared by the rest of Illinois. That’s why our union is working for a budget plan that is fair to all citizens of our state.”