Dan Rutherford

Artists from in state, out of state and even a couple foreign countries descended on Pontiac for several days in June to paint murals around the downtown area. The idea for the local Walldog Festival came from the Diaz family of Pontiac, themselves Walldogs.

The detrimental effects on employment of raising

the minimum wage - July 13, 2009

As discussed here, Dan Rutherford, State Senator (R-Pontiac) and Illinois 2010 State Treasurer Republican Primary candidate, today gave a very real world example of how Illinois' high minimum wage tends to cause jobs to go to states with lower state minimum wages. In a very timely piece, the Wall St. Journal editorial page discussed, this morning, the negative employment effects of the federal minimum wage and how the strongest disemployment effects of the minimum wage [scheduled to increase again in 11 days] falls on the least skilled groups [teens and welfare moms].

Of course, the above Wall St. Journal piece simply summarizes the empirical evidence that corroborates basic, price theory, which should be, but is usually not, learned in Econ 101. That is, if you place a floor on wages that is above the market clearing wage, the quantity of employees demanded will decrease from the market clearing amount and the quantity of employees supplied will increase from the market clearing amount, giving us a surplus of labor, also known as unemployed labor.

Sen. Dan Rutherford knows this, Jimmy John's knows this and the Wall St. Editorial Board know this. But, does President Obama know this? Does Obama's Council of Economic Advisers know this? And, if so, can they still really be big time supporters of higher minimum wages? Possibly. Could that be because unions want minimum wages as a way of protecting their members from competition from non-union labor? And, if so, does President Obama (and others who work for him) go along with the unions' wishes for a higher minimum wage because they find the hundreds of million of dollars of union contributions irresistible? Or, can they really believe that basic economic theory doesn't work? As Cong. Roskam (R-Wheaton,IL; 6th Cong. Dist.) might say, that would be a tall drink

SPRINGFIELD -- Illinois Gov. Pat Quinn is putting aside his call for an income tax increase until November.

In an interview Friday with The Associated Press, Quinn said he now wants to pass a state budget with significant spending cuts. Then in November, he would ask lawmakers to choose between balancing the budget by cutting even further or by raising taxes.

Quinn said delaying the decision for five months would provide time to study Medicaid spending, pension reforms and other cost-cutting measures.

Then officials would be in a better position to decide the best way to finish erasing a roughly $11.6 billion budget deficit.

The Democratic governor says he'll ask lawmakers to consider the idea when they return to Springfield next week.

Ill. Sending Layoff Notices To 2,600 Employees - July 7, 2009

(CLTV Photo)

DEANNA BELLANDI, Associated Press Writer
CHICAGO (AP) ― Gov. Pat Quinn on Tuesday began the process of cutting 2,600 jobs while sending a portion of the budget back to lawmakers with recommendations on how to cut $1 billion to help balance it.

Quinn could have made some of the cuts himself but instead chose to veto a budget bill and leave it to lawmakers.

"We've got to do that as a joint exercise because as governor I am only one branch of government; we have to have both branches of government — the legislative branch and the executive branch — executing a balanced budget. And we'll get there," Quinn said.

Lawmakers aren't due back to work at the Capitol until next week, but Illinois has been without a spending plan since a new fiscal year started July 1 with Quinn and lawmakers at an impasse over the budget.

Quinn wants an income tax increase to help fill a budget deficit he estimates at $9.2 billion, while some lawmakers have said they wouldn't even consider a tax increase without cuts, spending reforms and government efficiencies.

Quinn has already vetoed another budget bill that would have slashed spending on social service programs.

Quinn labeled this latest budget bill "inadequate" because it didn't sufficiently reduce the size of state government. But lawmakers quickly shot back that the measure was based on funding levels introduced by the governor in March.

"So it's impossible for it to be out of balance," House Speaker Michael Madigan's spokesman Steve Brown said.

The governor was accused of flip-flopping.

"Once again, he was for it before he was against it. Is he acknowledging that what he sent to us was flawed?" said Senate President John Cullerton's spokeswoman Rikeesha Phelon in an e-mail.

The clash over additional cuts seemed to come out of nowhere. Quinn told reporters two weeks ago that he and legislative leaders had agreed to reduce spending even further as they struggled to close the budget deficit. An outline of some of the proposed cuts has been public for more than a week.

Sen. Don Harmon, D-Oak Park, said the problem is a lack of specificity from the governor about the additional $1 billion in cuts.

The proposed cuts that Quinn wants didn't offer the kind of detail that some lawmakers had expected. For example, Quinn has suggested a 10 percent cut in programs and grants in some departments without spelling out which ones, and he recommends downsizing some "correctional facilities" without naming them.

"We'd like him as the chief executive to propose the cuts that he would make," said Harmon, the assistant Senate majority leader.

Republican state Sen. Dan Rutherford blasted Quinn for wanting more than 1,000 job cuts in the Department of Corrections because workers in the prison system are already stretched thin.

"We are absolutely putting a very overcrowded situation, short on staff today, on the brink of a disaster," said Rutherford, whose district includes the Pontiac Correctional Center.

The 2,600 layoffs Quinn wants — those in corrections and about 1,600 more in other agencies and departments — would save the state a small fraction of the money it needs to close its deficit.

The Democratic governor also wants employees to take 12 unpaid furlough days, a concession that would have to be union-approved.

The American Federation of State, County and Municipal Employees, the state's largest employee union, said an income tax increase — and not job cuts and furloughs — will fix the state budget.

"These cuts will slash vital services and undermine public safety, they will throw thousands of Illinoisans out of work — worsening the recession — and we will still be left with a multibillion-dollar deficit," union spokesman Anders Lindall said.