Illinois’ Arrogant, Ignorant Governor
To say that Illinois Governor Pat Quinn doesn’t get it fails to describe the depth of the man’s ignorance.
Here’s a recent statement he made about the possibility that one of the state’s marquee employers might leave the state — a statement which, after brief news search, I could only find in a Tuesday evening Investors Business Daily editorial:
Caterpillar is not leaving Illinois. They have well-skilled workers who know how to get the job done. They just signed an agreement with the United Auto Workers, I think for six years. I don’t think we should get in a panic at all.”
Even if Cat keeps its headquarters in Peoria and doesn’t reduce its existing Illinois blue- or white-collar workforce, it will be a hollow victory. Earth to Quinn: it isn’t just about keeping what you have, which Illinois is barely doing — maybe. It’s about capturing the new facilities growing companies like Cat build.
On that front, as Rich Miller at Capitol Fax details, Illinois has missed out on the following recent Caterpillar expansions, most if not all of which might have been reasonable prospects for the state if it didn’t have such a punishing business climate made worse recently by additional income tax hikes:
* Dec 18, 2008: Cat announces new plant in Texas …
* January 5, 2009: Caterpillar plant, 600 jobs bound for North Little Rock
* Jul 30, 2010: Cat announces new North Carolina plant – 850,000-square-foot facility will be used for axle assemblies
* October, 2010: Caterpillar Selects Victoria, TX, For New Hydraulic Excavator Facility
If an Illinois-based company like Caterpillar won’t even think about expanding in Illinois, it’s reasonable to believe that other Illinois-based companies are acting similarly, and that few out-of-state companies looking to expand are giving Illinois serious consideration.
The IBD editorial elaborates further, reminding the governor that the company didn’t just spring up out of the Illinois cornfields:
According to the nonpartisan Tax Foundation: “The (Illinois) corporate income tax will rise from 7.3% to 10.9%, a 49% increase and (making Illinois’) the highest state corporate income tax in the United States and the highest combined national-local corporate income tax in the industrialized world.”
In other words, anyplace Caterpillar moves — and that means anywhere — the tax situation will be an improvement on what it faces in Illinois.
Before he pooh-poohs the possibility of losing Caterpillar, Gov. Quinn might review the company’s history. Cat got its start not in Illinois, but in California in 1883 as the Stockton Wheel Co. After various incarnations and acquisitions through much of the 20th century, it became Caterpillar.
In 1967, the company moved its headquarters from Stockton to Peoria, where it now employs 23,000 of the 100,000 workers who make those gigantic yellow construction and mining machines that are among the best in the world, if not the best.
… Until the governor recognizes that businesses operate on real-world accounting, not the government’s big-tax approach to business, he’s looking at the migration of not only Caterpillar, but other big home-based enterprises — State Farm maybe, or McDonald’s — to states where entrepreneurs and world-class companies are treated as precious resources, not strip-mined for taxes to pay for unsustainable and inefficient government.
Caterpillar, of course, is lucky. It can move. Unfortunately, small towns that rely on business with Caterpillar workers will go under. So will many small businesses that aren’t able to move after such tax hikes.
If Quinn doesn’t think Caterpillar has given him reason to panic, he’d better think again.
Pat Quinn will not recognize that people — and companies — can and do vote with their feet. Caterpillar did so when it planted its headquarters in Illinois 44 years ago. It can do so again. So can other Illinois companies.
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