Gov. Richard Ogilvie debates Democratic challenger Dan Walker at the Pick Congress Hotel in 1972. File Photo.
Is Quinn history thanks to income tax move?
SPRINGFIELD — Former Gov. Richard Ogilvie and one-time gubernatorial contender Dawn Clark Netsch crashed their political careers because of Illinois’ income tax.
But Gov. Jim Edgar and Gov. Pat Quinn didn’t face the same misfortune — at least yet, in Quinn’s case — despite touching that third rail of Illinois politics.
As Illinois heads into another gubernatorial election, the big unknown is whether the incumbent Democratic governor can pull off a repeat performance from 2010, when he campaigned for a hike in the state income tax and still persuaded voters to send him to 410 E. Jackson, home to Springfield’s executive mansion.
During the past four decades, tax increases have been a volatile issue that has decided gubernatorial campaigns and left political casualties. The heated matchup between Quinn and Republican Bruce Rauner is another test of the potency of that wedge issue.
Last week, Quinn ended months of dancing around the income-tax question and said he would push for a permanent extension of the temporary 67-percent hike he enacted in 2011 to help pare a multibillion-dollar backlog of unpaid bills and pay increasing state pension obligations.
Helping him make his case this go-around is none other than Edgar, the former two-term Republican governor, whom Quinn consulted before his budget address and on Friday appeared to gain his blessing for the plan.
“From a governmental point of view, it’s probably the right thing to do,” Edgar told Early and Often. “Politically, it’s definitely kind of a roll of the dice.”
In Rauner, Quinn is up against possibly the best-funded gubernatorial challenger in state history. After Quinn’s budget speech, the multimillionaire’s campaign dispatched “Quinnocchio” to harangue the governor for going back on his word that the 2011 tax increase would be temporary.
In what undoubtedly is a precursor to an onslaught of anti-Quinn TV advertising during the next seven months, Rauner also released an online ad titled “Truth” the day before Quinn’s speech, accusing the governor of a litany of “broken promises” on taxes.
As Quinn made his tax stance public, he laid out an alternative funding scenario that would involve “savage” cuts that would occur if the 5-percent individual income tax rate and the 7-percent corporate rate were allowed to drop in January, leaving a budget hole of close to $2 billion.
Some analysts believe Quinn can persuade voters to support him this fall despite opposing letting individual income-tax rates roll back to 3.75 percent and corporate rates drop to 5.25 percent in January.
“I’m not going to ever bet against an incumbent Democratic governor in the state of Illinois,” said David Yepsen, director of the Paul Simon Public Policy Institute at Southern Illinois University and a former longtime political reporter at the Des Moines Register in Iowa. “I think the governor gets some credit for telling voters the truth. We all know this state is going to have to cut spending and find some place to raise revenue. Let’s get the debate on the table.
"He can also challenge Rauner then by saying, ‘What would you do?’ I think it forces Rauner to take a stronger position, as well. Let’s have the debate,” Yepsen said.
Rauner has called for letting the taxes roll back and cutting spending, but has not laid out specifics.
“I think people respect politicians who tell them the truth, who’ll be candid with them and tell them what they don’t want to hear. He’s got time to sell this,” Yepsen said of Quinn. “He’s got to go to work. I think it’s a gutsy move.”
Historically, such gutsiness has not been rewarded by voters.
In 1972, Ogilvie lost his re-election bid to Democrat Dan Walker after championing legislation in 1969 that imposed Illinois’ first income tax, which then was set at 2.5 percent for individuals and 4 percent for corporations.
Ogilvie’s support for that tax was described as “political suicide” by journalist and gubernatorial biographer Robert P. Howard in his book on Illinois governors, “Mostly Good and Competent Men.”
“I wish we had handled it better, and he knew ...; that the public would need a PR campaign to explain how necessary and important and useful the money was. But it never happened,” Ogilvie’s former press secretary, Joseph Mathewson, told Early & Often.
Mathewson, now a professor at Northwestern University’s Medill School of Journalism, Media and Integrated Marketing Communications, said Ogilvie didn’t talk about an income tax in the 1968 campaign and opted against appointing a commission after his election to help make the case for the income tax.
“He just dropped the bomb on the Legislature with no forewarning about fiscal problems, deficit, etc.," Mathewson said. "The voters never recovered. I think Quinn could have learned from Dick’s experience, although his plan isn’t as totally stunning, of course.”
Nearly two decades after Ogilvie’s loss because of the income tax, Edgar managed to dodge the same fate when he opened his campaign to succeed retiring Republican Gov. James Thompson in 1990 by advocating that an earlier temporary income-tax hike be made permanent.
In 1989, facing a state fiscal crisis, Thompson and the Democratic-led General Assembly bumped up the income-tax rate for individuals to 3 percent from 2.5 percent and to 4.8 percent from 4 percent for corporations. By 1993, those rates were scheduled to slide back to 2.75 percent for individuals and 4.4 percent for corporations.
Despite wanting to make the increases permanent — and they eventually were — Edgar fended off a primary challenge from the GOP’s conservative flank and went on to narrowly defeat his Democratic rival, then-Attorney General Neil Hartigan, in 1990.
“That was a tough sell,” Edgar recalled, struck by how similar things are now with Quinn. “When they passed this tax increase three years ago and made it temporary, I thought here we go again.”
In 1994, Edgar used the income tax to his political advantage. He hammered his Democratic opponent, then-Comptroller Dawn Clark Netsch, for pushing an educational tax-swap plan that would have raised the state income tax by $2 billion, providing half of that to schools and the other half to property tax relief.
Edgar had the 1994 campaign virtually sewn up by June of that year after hitting Netsch in a barrage of TV advertising from which she never recovered. He went after her support for abolishing the death penalty and for what he characterized as a 42-percent increase in state taxes.
"They didn’t just say ‘income,’ they said ‘a 42-percent tax increase,’ and they completely left out the fact that a big hunk of property tax relief was part of the package as well,” Netsch said in a 2011 interview with the Abraham Lincoln Presidential Library and Museum.
Netsch, who died last year, told her interviewer, Mark DePue, that she later learned Edgar had told the late U.S. Sen. Paul Simon that he believed she was “ahead of her time.”
Edgar would go on to propose an educational tax-swap plan of his own in 1997 that resembled Netsch’s.
"Soft on crime. Big on taxes. That’s all they needed,” Netsch said of Edgar’s campaign tactics during her interview, which is part of the Lincoln presidential library’s oral history program.
House Speaker Michael Madigan, D-Chicago, and Senate President John Cullerton, D-Chicago, are backing Quinn’s tax plan, and the longtime speaker said he believes the governor can win with that message, avoiding the same backlash that doomed Netsch.
“The governor will be re-elected because, as he said [Wednesday] as part of his address, he’s being perfectly honest with the people of the state of Illinois,” Madigan told reporters Thursday. “If the people of this state wish to continue with the level of services which are being provided today in education and other areas, you need to extend the income-tax increase.”
Quinn has added a political sweetener to his package: annual $500 property tax refunds for homeowners that could hit mailboxes later this fall. The idea, initially proposed by Madigan, would result in homeowners getting some portion of that $500 refund depending on the size of their property-tax bills. Anyone now paying more than $10,000 annually in property taxes would be net losers under his plan.
Madigan said Quinn’s situation isn’t comparable to Netsch’s.
“No, I don’t think it is because there’s a heightened level of understanding because it’s going to be a broad-based tax,” Madigan said. “As an example, there’s going to be real relief for homeowners on their real estate taxes, which was my demand as part of the package. So I think after this is fully understood by the people of the state of Illinois, they’ll be supportive of it.”
Edgar, a backer of GOP state Sen. Kirk Dillard in the gubernatorial primary, isn’t so certain the politically weakened Quinn will be able to prevail while carrying a pro-tax message, even if, governmentally, it might be best for the state.
“The problem Quinn has got is his approval ratings are so low to start with. It doesn’t take much,” Edgar said. “Politically, it was a risky thing to do.
“Rauner will hit him on it,” Edgar continued, “and I don’t think Madigan did him any favors [in 2011] by making the tax increase temporary because it’s coming back right during the election.”
Ultimately, the former governor said, the fall election may well be decided by how good of a salesman Quinn can be.
“I think he needs to explain to folks what cuts they’ve made, what happens if they don’t get that,” Edgar said, “and that’s a tough sell.”