Late in December, the daily newspaper that lands on my doorstep each morning, the Bloomington (IL) Pantagraph ran an editorial highlighting a policy paper by the Illinois Policy Institute titled Still Leaving Illinois: An Exodus of People and Money. The IPI’s solutions to Illinois’ perceived problems, echoed in the editorial, sounded boringly familiar – repeal the just-enacted income tax hike, “reform” state employee pensions, create a more business-friendly climate, and all the rest of the conservative wish list. The editorial has now rolled into the paper’s pay-to-view archive, so I can’t link to it, but I decided to use my once-every-30-days LTE allotment to respond. But first things first. What is the Illinois Policy Institute, anyway?
Like most of these outfits, the Illinois Policy Institute’s website is pretty innocuous-sounding, claiming:
The Illinois Policy Institute inspires changes in hearts, minds and laws through our mission to promote personal freedom and prosperity in Illinois and America. As a leading independent research and education organization, the Institute generates positive and sustainable policy solutions for citizens and lawmakers that help unleash talent and entrepreneurial ability.
The first red flag snaps up under the ‘Donate’ tab:
The Institute takes no government grants of any kind and is funded by the voluntary contributions of thousands of committed supporters across the state who share our belief in free markets and free people and our vision for a more prosperous Illinois.
We respect our donors' privacy and have a policy to not comment about any donor specifically, though donors are free to share their reasons for supporting our efforts if they choose to.
It didn’t take much googling to find the connection I expected to find:
IPI is a member of the American Legislative Exchange Council (ALEC) as of 2011. Brian Costin, IPI Director of Outreach, and Ted Dabrowski, Vice President of Policy, represent IPI on ALEC's Tax and Fiscal Policy Task Force. At the 2011 Annual Meeting, Costin introduced the "Local Government Transparency Act" model legislation, and Dabrowski introduced the "Pension Funding and Fairness Act" model legislation for adoption by the task force. The latter was adopted and proceeded to the ALEC Board of Directors for approval. Executive Vice President Kristina Rasmussen represented IPI on the Tax and Fiscal Policy Task Force as of April 2010, when she penned an article entitled "Pension Funding Reform: A Solution for Budget Deficits" for ALEC's newsletter, Inside ALEC.
Sourcewatch: Illinois Policy Institute
Now to see how much of this I can lay out in 250 words without sounding like a conspiracy kook.
Don’t believe what ‘think tanks’ claim
January 1, 2012
An editorial in the Dec. 28 Pantagraph, “Residents leaving dilute state’s revenue, power,” cited a paper by the Illinois Policy Institute asserting residents are leaving the state in droves because of “bloated government and high taxes,” a claim The Pantagraph parrots without critical analysis.
The exodus, in fact, is spurred by a long-term trend of businesses leaving the state for areas where they can pay workers less.
According to Census Bureau data, of the states gaining population through migration from other states, only a handful of special cases such as the District of Columbia have a higher per capita income than Illinois.
Such misrepresentation from IPI is not surprising. Though claiming non-partisanship, their actions say otherwise.
They are affiliated with the State Policy
ProjectNetwork and the American Legislative Exchange Council who, though also proclaiming non-partisanship, are part of a labyrinthine network of conservative think tanks, policy institutes and other organizations funded almost entirely by corporations, trade groups representing major industries and wealthy individuals and their foundations.
These organizations manufacture specious arguments and present misleading analyses of data to promote the agendas of their sponsors, as the IPI does in this case.
The IPI is part of the ongoing, clandestine movement to rewrite our laws and tax codes to favor corporations and the wealthy — the very factors that have triggered the Occupy movements around the country. To quote Occupy, we don’t mind you being rich, we mind you using your wealth to buy our government.
Daniel Steffen, El Paso
This morning, I was surprised to see my name pop out of the letters page in a letter from – guess who – Executive VP Kristina Rasmussen of the Illinois Policy Institute.
Public Policy decisions cause people to leave
January 17, 2012
It’s an incontrovertible fact that people are leaving Illinois. The IRS migration data highlighted in our recent study, and unfairly maligned in a Jan. 1 letter to the editor by Daniel Steffen of El Paso, shows that people are moving to states with lower taxes, more affordable homes and less union membership.
It shouldn’t be surprising that people want to be free — free from overwhelming government, from costly mortgages and from labor control over the workplace. Leaving family and friends is hard, but for many, the prospect for opportunity and advance lies outside our borders. This is the unintended consequence of decades of shortsighted public policy decisions.
Illinois is in a fiscal crisis. This is another fact. Looming pension liabilities and an uncertain tax climate feed the out migration.
We have two choices. One, deny the problem and delay any change. Two, understand the challenge and pursue positive and sustainable policies that seek to put Illinois back on top.
The Illinois Policy Institute stands for the latter. If you’re interested in standing with a leading independent research organization that promotes personal freedom and prosperity in Illinois, I encourage you to visit our website.
Kristina Rasmussen, Springfield
The writer is executive vice president, Illinois Policy Institute.
Kossack marykk has long used a sig line that says, “If you think you're too small to be effective, you've never been in the dark with a mosquito.” Apparently this mosquito has drawn blood.
It was never my intent to unfairly malign the IRS migration data. Data is just data. It just sits there and it is what it is. It's the people at the Illinois Policy Institute who pretend to have drawn unwarranted conclusions from the data that I meant to malign, but I assure you, I meant to do it fairly.fairly.
I suggested that IPI and its cohorts manipulate data and distort facts. Let’s take an example. It is indeed an incontrovertible fact that people are leaving Illinois. It is also an incontrovertible fact that people are coming into Illinois. People are also being born in Illinois, and new immigrants are coming to Illinois. The IPI report contains a graphic showing one resident leaving the state every 10 minutes, carrying with them, over the period from 1995 to 2009 $26 million in income. That would be a loss of over 52,000 residents a year. But from 1995 to 2009, the population of Illinois has actually increased from about 12 million to 13 million in the latest census.
So what does the IPI do? They employ a favorite tactic of conservatives – if the data doesn’t support your position, use other data. New Deal deniers do this when they use the Dow Jones average instead of GDP to gauge economic recovery in the 1930s. The IPI does it here by using IRS data instead of census data. They claim it gives a more accurate picture of the financial impact of population changes. I think they use it because they can make their point with it. Census data just shoots them down.
But even going along with them, and assuming the table of migration data on page 3 of their report is accurate (not always something you can take for granted dealing with conservatives) we see that the rate of net loss of migration in vs. migration out has actually declined since the early 2000s, by over 35% since the 2003 peak of 63,890 (45% if we use the 2008 figure of 35,121).
Maybe now that residents are certain their income tax rates are going up 67% (aka 2%), they’re relaxing, chilling out, and sticking around.
One of the drivers of migration, according to the IPI, is the high cost of mortgages. But since I can get a mortgage from almost anywhere at the cheapest rate I can find, the real driver of higher mortgage costs would have to be higher housing costs. Why would Illinois’ housing costs be higher? It seems like the answer would have to be larger, more expensive houses and/or greater demand. If I remember my Econ 101, those are things that are driven by supply and demand, not government policy.
The IPI and I are actually in agreement on one point, in a round-about way, though we are apparently at polar opposites as to cause. I said in my letter that businesses had historically left Illinois for states where they could pay people less. The IPI, in its report, says:
Union membership: Union membership measures the percent of the state’s employed labor force that are members of labor unions, as averaged over the 1995 to 2007 time period. Illinois’ average union membership was 18 percent. Households left for states where union membership was 41.89 percent lower
Apparently the Illinois Policy Institute would like you to believe that people migrated to these states drawn by the “freedom” of the union-free environment, and businesses, desperate for workers, just naturally followed. Evidently we are all Austrian-school economists now. Who knew?
The Pantagraph, to its credit, did not bring up this little angle of the IPI’s agenda. Though I’m sure they are as anti-union as the next downstate conservative, they are at least smart enough to recognize that this is the home of Pullman and McCormick the Haymarket and Herrin and the Memorial Day Massacre, a legacy of unionism that is soaked (in blood) to the state’s very core, and know that no matter how much you may think it, you just don’t say those things here.
But what about the money stat? In these states to which Illinois residents are allegedly fleeing, just how enormously gigantic is the disparity between tax rates?
|Category||Illinois||Average migration state
|State and local tax burdens||10.27%||10.13%|
So, when you really get down in the weeds, it’s pretty hard to take the Illinois Policy Institute’s arguments seriously. But look on the bright side, IPI. If you’re right and people really are fleeing the state, that will decrease our population density, and your own report cites lower population density as one of the factors drawing migrants to these other states. So that should have them rushing back to the state in droves.
Unless everything in your report is just a bunch of malarkey.
I just wish I wasn't locked out from writng another LTE until February 1st.