Federal spending in Illinois shortfalls, headaches and hostages THE HEADLINES from recent Chicago papers could tell the story by themselves: "Is the military fair to Illinois?" Sun-Times, January 22. "Fermi director quits to protest funds shortage" Tribune, February 10. "Welfare plan cuts Illinois share of jobs" Tribune, February 14. "Senators hit plan to shut Navy research unit here" Tribune, March 25. And, finally, the other side: "Illinois sixth in tax load per family" Tribune, March 8. It is hard to escape the dominant impression that Illinois sends a lot more tax dollars to the federal government than it gets back in federal spending on a proportionate basis. Illinois, like other industrial, Midwestern states, is getting shortchanged. Meanwhile, federal largesse flows increasingly to the Sunbelt states of the South and West. Critics say this movement of federal cash hurts states which are losing industry, revenues or population to the Sunbelt. Illinois is generally classed among the "losers" in this scenario. But is Illinois really losing all that much? It depends on how you look at the issue. On a quantitative basis, Illinois taxpayers do come up short. Based on figures drawn from the 1976 budget (the latest available with state-by-state breakdowns), Illinois taxpayers receive 81c from the federal government for every tax dollar paid. The Sun-Times reported that Illinois finishes dead last in defense contract spending in the entire nation. We get back 3c worth of defense contracts for each tax dollar and that figure may be inflated. But such a defense spending lag may not be all that bad. Seattle, Wash., was and is dependent upon one defense contractor Boeing for more than 10 per cent of its total employment. When defense contracts suffered large cuts in the early 1970's, Boeing practically collapsed. Seattle's economy slid into a depression from which it has not completely recovered. By contrast, Illinois budget director Robert Mandeville told the Sun-Times that with no substantial defense industry, Illinois avoids the economic wild swings found in defense-heavy states. And though Gov. James R. Thompson criticized the federal government for not steering defense contracts to areas with high unemployment, he told other governors that he would prefer instead to get more medicaid, community development and education funds. Public works spending forms another large portion of the federal dollar contribution to the states. These days, large public works projects are coming under increasing congressional and administration scrutiny. And five "big ticket" Illinois public works projects have drawn legitimate opposition in Washington or in Illinois recently. Chicago projects The first, Chicago's Crosstown Expressway, has been a headache for years. After a long and probably unfinished battle, the 14-mile road will cost at least $1 billion. The expense, community opposition and an administration priority of completing unfinished intercity interstate highways, make the Crosstown a dubious project. The Chicago Metropolitan Sanitary District's $7.3 billion Deep Tunnel pollution control project is under fire on three fronts. Congress' General Accounting Office has criticized the cost-effectiveness of the plan. The Better Government Association called it "a gigantic boondoggle." And the Chicago Tribune printed a list of politically connected contractors who will reap fat contracts from the Deep Tunnel. The proposed Franklin Street subway would replace Chicago's 80-year-old Loop Elevated structure. With the cost of other subways rising out of sight, the U.S. Transportation Department is taking a long second look at the Franklin Street distributor line. Downstate projects Downstate's public works projects aren't faring much better. Locks and Dam 26 near Alton is being held hostage in a fight over user fees for barges using federal waterways. Until the user fees issue and environmental challenges are resolved, don't look for work to begin near Alton. As for the Greater St. Louis Airport, the idea is flatly opposed by 24th District Rep. Paul Simon (D., Carbondale). He calls it an economic mistake and prefers small localized public works projects. The airport has a better chance of flying, though: Thompson, Rep. Mel Price (D., 23rd) and several Missouri officials support it. Discounting defense, public works and anti-recession spending, Illinois may be better off than at first glance. That doesn't mean the picture is totally rosy: we still won't be on a par with some Sunbelt states. But the state's Congressional delegation can concentrate on spending which has a real impact: restoration of the $6 million cut from the Lake Michigan cleanup program, more money for the world-renowned Fermi Laboratory, and funds for "people" programs such as education, mass transit operating subsidies and urban development. All of these programs were pushed by Thompson when he appeared before Congress. And it is funds in those areas or lack of them that Illinois should really worry about. June 1978 / Illinois Issues/35
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