State Gives $63 Million Tax Incentive to Chrysler

by Amanda Griffin-Johnson The state budget crisis has created mounting problems for the state government, from state credit ratings plummeting to vendors refusing state orders because of late payments. But this hasn’t stopped the spending. Earlier this month, Governor Quinn granted $50 million of new spending for job training projects, even though hospitals, schools, and non-profits are still waiting for...

by Amanda Griffin-Johnson

The state budget crisis has created mounting problems for the state government, from state credit ratings plummeting to vendors refusing state orders because of late payments. But this hasn’t stopped the spending. Earlier this month, Governor Quinn granted $50 million of new spending for job training projects, even though hospitals, schools, and non-profits are still waiting for millions of dollars in overdue payments from the state. A few weeks ago, the state gave a $7 million investment package to U.S. Cellular to keep their headquarters here. And yesterday, Governor Quinn announced the state is giving Chrysler a $62 million tax incentive package to keep their plant in Belvidere open. Illinois Statehouse News reports:

In one of the first signs of the newly reorganized company’s intentions, Quinn announced a joint investment with Chrysler of several million dollars from the state and $600 million dollars from Chrysler to keep the Belvidere plant open for the foreseeable future.

Quinn said the money will be instrumental in keeping thousands of people in their jobs.

“I have been working with Chrysler frankly night and day for quite some time and I’m very blessed that their board of directors approved our incentive package,” Quinn said. “Our state is investing $62 million dollars, which is a lot of money, to preserve 2,000 jobs.”

Quinn is correct; that is a lot of money. Why is the state using subsidies to pick winners and losers? Instead, the state should improve the overall business climate to transform Illinois into the type of place entrepreneurs and business owners want to start and grow their businesses. While it is a good thing that 2,000 jobs are preserved, the victims of these policies are often invisible. Over 600,000 people have left the state between 1999 and 2008, and Illinois ranks 48 out of the 50 states for job growth. How many jobs have the state’s fiscal irresponsibility and unfriendly business climate cost us?