Lasalle street tax sign-on letter for legislators

LST-Legislator-sign-on-letter PDF

Governor Rauner,
As elected representatives of the people of Illinois, we express our outrage at your proposed
“Turnaround Agenda” for Illinois, including proposed budget cuts. The Agenda would slash
funding for programs that are vital for Illinois communities and individuals. We are deeply
disturbed by the callous disregard for the well‐being of Illinois’ working families that you
displayed by proposing billions of dollars of cuts to the programs that serve the people of our
state while also proposing corporate tax breaks. Despite the overwhelming evidence that right
to work results in lower wages – and thus lower income tax revenues – and fails to attract
additional investment, the Agenda also includes “right to work zones”.
The people of Illinois will not tolerate that massive cuts in funding for vital programs and
services occur, while wealthy individuals and corporations are sheltered from paying their fair
share. Far from resolving the budget crisis in Illinois, the cuts that your Agenda seeks will hurt
not only our families and communities but our economy as well. We demand that you retract
your “Turnaround Agenda” and proposed budget cuts and, instead, propose an agenda that
reflects the lessons that we can learn from other Midwestern states. Your agenda of cutting
social services while offering incentives to businesses has already been tried – and failed – in
Wisconsin. We urge, instead that you follow Minnesota’s example in which investment was
increased in education and job training, taxes were increased on high income households and
businesses, the minimum wage was increased, not over 7 years but over 3 years, and Medicaid
was expanded. The result: Minnesota is today facing a more then $1 billion SURPLUS while
Wisconsin faces a similar DEFICIT.
Contrary to popular talking points, Illinois is not over spending. According to the Kaiser Family
Foundation, Illinois spent less per Medicaid recipient than forty‐five states in Fiscal Year 2012,
the last year reported and experienced only 0.7% growth in Medicaid spending from FY 2010
through Fiscal Year 2013 – the sixth lowest growth rate in the country. In 2012, the last fiscal
year reported, Illinois had fewer public employees per 10,000 residents than all but three other
states. Illinois collects a lower income tax rate than do Michigan, Missouri, Wisconsin and
Minnesota. In order to truly solve this crisis we need additional revenue.
The irresponsible speculative trading and predatory lending practices of the financial sector
contributed to the economic crisis that we now face. It is time that the financial sector be
asked to be part of the solution. Given the severity of the budget and debt crisis, we advocate
strongly for a financial transactions tax, aka “LaSalle Street Tax,” as part of the revenue
solution.
A tiny flat fee of $1‐2 on contracts for the buying/selling derivatives at the CME and CBOE,
along the lines of that proposed by HB106, would, at current volume levels, generate $10 to
$12 billion dollars for the State of Illinois annually. With the average contract size at these
exchanges averaging more than $225,000, this $1 or $2 fee is less than 0.01% of contract value.
In comparison with the current 6.25% IL sales tax, the LaSalle Street tax is quite a bargain. We
cannot afford to leave this huge source of revenue out of the equation as we try to find
solutions for a balanced budget in Illinois.
A successful state means public services we can be proud of, restored public infrastructure, and
shared prosperity. With a LaSalle Street Tax in the mix, Illinois would have the ability to provide
funding for services that we all depend on.
We urge you to reverse these proposed cuts and to work with us to fairly fund Illinois’
community needs, including the implementation of a LaSalle Street Tax.
Signed,

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