Illinois Governor Pushes Anti-Labor Agenda Amid Budget Standoff

AP Photo/Seth Perlman, File

In this November 10, 2015 file photo, protesters rally in support of lawmakers ending the state budget impasse at the Illinois state Capitol in Springfield. Governor Bruce Rauner takes pride in not being like any of Illinois’ previous governors. Unlike even his Republican predecessors, who often cut deals with Democrats and their labor union allies in the Legislature, Rauner brags about being the first to stand up to them, even as it’s led to a record-breaking stalemate. Seven months after Illinois’ last state budget expired, it still doesn’t have a new one. 

In Illinois, schools are open, public employees are being paid, and roads are under a seemingly perpetual state of repair and construction. But the unremarkable scenes throughout the Prairie State belie a slow-moving disaster of cutbacks, shortfalls and legislative gridlock, as lawmakers struggle to pass a budget more than eight months after the fiscal year began on July 1 last year.

A fierce partisan battle between the state’s Democratically controlled legislature and its Republican governor, its first in more than a decade, lies at the heart of the standoff. As the state lurches toward its March 15 primaries, the budget deal—and the separate issues to which the governor insists the budget be linked—looms large over a number of local races.

Bruce Rauner, the venture-capitalist-turned-governor, has been adamant about attaching a slate of labor-busting measures he contends are necessary to his budget, which the legislature has shown no inclination to enact.

“Rauner’s only goal is to destroy the labor movement,” says Roberta Lynch, the executive director of AFSME Council 31, which represents 38,000 state workers and is in the middle of its own impasse with the governor over contract negotiations that began last year.

When Rauner first introduced his budget in February of last year, he called for a combination of slash-and-burn cuts—$1.5 billion from Medicare, $82 million from mental-health programs, and $400 million from higher education (a decrease of more than 30 percent)—and a slate of labor measures, including municipal right-to-work zones (since he had no chance of winning a state right-to-work law) and providing municipalities with a pathway to wipe out pensions.

Unsurprisingly, Democrats balked. The veteran House Speaker Michael Madigan called Rauner’s inaugural proposal “reckless,” and accused him of “operating in the extreme” for tying unrelated policy changes to the state budget.

In 2014, Rauner, a former private equity executive from Chicago’s wealthy North Shore suburbs, ran against Pat Quinn, an unpopular Democratic governor, blaming him and his party for the state’s longstanding woes. At the time of the election in 2014, the state’s outlook was grim. It joined only five other states experiencing population loss that year. At 8.4 percent, the state had the third worst unemployment rate at the time. One in four Illinoisans told Gallup that their state was the worst place to live, by far the highest rate of any state in the poll. And pension obligations, which stand at $111 billion today, constituted the nation’s highest unfunded pension liability.

Quinn’s temporary income tax hike and his pension overhaul combined to alienate a diverse group of would-be supporters. As has become the case in midterm elections, voter turnout among minorities was low (in Chicago, turnout fell by one-third from its level in the 2012 presidential contest). Spending $27.6 million of his own money to take advantage of these factors, Rauner managed to turn what is normally a solidly blue state red—but only at the gubernatorial level, as Democrats retained their supermajorities in the legislature.

During his campaign, Rauner stoked voters’ ire toward unions. “Government union bosses,” he said, “use your money to elect and lobby politicians who will grow government and give them more money.”

But Democrats have not been as union-friendly or business-hostile as Rauner depicts them. It was the Democrats under Quinn who gave $330 million in tax breaks to Sears and the Chicago Mercantile Exchange to stay in Illinois. After vesting Quinn with executive authority to make $1 billion in budgetary cuts and layoffs, it was the Democrats who stopped short of reforming the state’s tax structure, one of the most regressive in the nation. And it was the Democrats who allowed Quinn to pass a drastic pension overhaul, one that would have wiped out much of the state’s pension obligations.

Though the state’s supreme court struck down the deal, the damage was done. Rauner, promising to “Shake Up Springfield,” rumbled through to victory.

Those rumbles have only intensified, and Springfield is crumbling as a result. Last month, as he presented his second budget, Rauner gave Democrats an ultimatum: Accept my attacks on unions or give me control of the budget as you did for Quinn.

“I won’t support new revenue unless we have major structural reforms to grow more jobs and get more value for taxpayers,” he said. “That leaves us with only two choices: Either you give the executive branch the authority to cut spending to live within our revenues. Or, we agree … on economic and governmental reforms, to accompany a negotiated balance of spending reductions and revenue.”

Rauner’s “economic and governmental reform” included a litany of measures designed to weaken worker and consumer power: “Workers’ compensation reform and lawsuit reform, mandate relief, consolidation, local control of bargaining, and bidding to drive down property taxes.”

Democrats, unable to stomach the attacks on workers’ rights, and the more extreme version of the very austerity measures they peddled in the preceding decade, have cried foul. Still, Rauner has found a handful of Democratic friends in the legislature, frustrating the efforts of House Speaker Michael Madigan, whose chamber consists of 71 Democrats, the exact number required for a veto-proof supermajority.

The defections by a few anti-union Democrats have thwarted efforts to override the governor and thereby enact a budget. Among Rauner’s renegades is Representative Ken Dunkin, who has broken ranks on key labor votes, including one that would have limited Rauner’s power in negotiations with AFSCME 31. When asked to explain his failure to support the bill, Dunkin told the Chicago Tonight program, “I don’t work for Speaker Madigan.”

Dunkin’s brazen rebellion earned him the backing of Rauner and his well-heeled allies. One of their campaign organizations gave Dunkin’s re-election campaign $500,000, the single largest contribution ever in a state primary. One of the group’s founders, Ken Poft, has also been vocal in his opposition to labor. “You cannot have structural reform with public-sector unions,” he told a local radio show. Rauner himself has said he speaks frequently with Dunkin. “He and I share a passion around economic empowerment, especially in the black community," Rauner told a Chicago news channel.

Not surprisingly, AFSCME and Madigan have backed Dunkin’s opponent in the upcoming March 15 primary battle for his district, which stretches from Chicago’s affluent downtown business district to its poorer South Side. In a recent address in Springfield, even President Obama, in a passing remark, appeared to question Dunkin’s deviations, and has endorsed his primary challenger, a rare move for a sitting president.

The labor issue has led to a defection in the Republican caucus as well. State Senator Sam McCann, whose district includes a large number of state workers, voted in favor of the same bill on which Dunkin broke ranks, the only Republican senator to do so.

McCann’s downstate district is heavily unionized, and he did not hesitate to say this motivated his vote. “I represent more state employees than any other member of the General Assembly,” he told the State Journal-Register. “I didn't choose any special interest; I chose taxpayers today. The state employees are taxpayers. They work for a living.” As a result, McCann has found himself in his own primary challenge. Though bolstered by labor contributions, he faces a well-financed opponent who has received over $1.3 million from a Rauner-aligned PAC.

With these contests, the primaries will not only determine if the parties can maintain discipline, but also whether the Democrats can derail Rauner’s agenda. To Agber Dimah, a Chicago State University political science professor whose school faces closure because of the budget crisis, that agenda looks suspiciously like that of the governor of the state’s neighbor to the north.

“Illinois is a union shop, and the first thing Governor Rauner has tried to do since assuming office is to toe the line of [Scott] Walker,” Dimah says, referring to the Wisconsin governor whose anti-union stances made him a conservative star.

Whether or not Rauner can realize his agenda thus depends on next week’s primaries. A patchwork of court orders is keeping essential services running and employees paid in the meantime, just as universities are sending layoff notices, mental health programs are shuttering, and local governments are left scrambling to close their own budgetary shortfalls. 

All this leads Dimah to question Rauner’s political savvy. In a poll released in early March by the Paul Simon Public Policy Institute, the governor’s approval rating had fallen to 41 percent, while 50 percent of Illinois voters disapproved of his performance in office. “He has this mentality that running a government is similar to running a business,” Dimah says. But instead of shareholders, Rauner will have to answer to what may end up being a much less forgiving crowd: the electorate.

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