An annual financial report from Gov. J.B. Pritzker’s office forecasts a gloomy fiscal future for Illinois and pushes his false choice between dire spending cuts or a flawed progressive tax plan.

Gov. J.B. Pritzker inherited a $2.8 billion budget deficit the moment he stepped into office. Next year, that deficit is projected to be $3.4 billion1. It’s the same story every budget season. But Illinois’ budget crises could be a thing of the past if the state would adopt pension reform, right-size its union contracts and...