Monday, May 31, 2004

Dated May 31, 2004 at 3:55 am and revised, May 31, 1:45 pm.

Blogging Blago. There Ain’t No Such Thing As A Free Lunch. TANSTAAFL, except perhaps in the imaginative, populist, quirky mind of Illinois' Governor, Rod Blagojevich.

On Friday, WTTW aired an interview that Bob Sirott did with Gov. Blagojevich. Most of it was the soft stuff we have become accustomed to from Sirott on Chicago Tonight in the last year. However, when concluding the interview, Blago, made some creative, albeit unsupported, allegations that the corporate robber barons in Illinois were getting tax breaks at the expense of the school kids. As Jim Ryan said almost two years ago, also on WTTW, has Blago no shame? Well, has he?

The interview with Gov. Blagojevich was conducted some time prior to Friday night, but WTTW didn’t tell us when it was taped. Indeed, if you were not a regular viewer of Chicago Tonight, you might have thought it was airing live. A little deceptive, don’t you think? On my show, “Public Affairs,” we announce, at the beginning of the show, when it is being taped and include the taping date as a graphic at the end of the show. If nothing else, it protects the guest from looking stupid by answering a question on say, May 25, when events would dictate a different answer on May 28, 2004.

The division of labor, in part, between Phil Ponce and Bob Sirott on WTTW [Public TV in Chicago] seems to be that Ponce tends to do the political, substantive public policy interviews and Sirott the "lighter stuff," of which there has been a not inconsiderable amount since Sirott and Friends re-formatted Chicago Tonight. The allocation between Sirott and Ponce is perhaps WTTW’s loose application of comparative advantage theory, or as Dirty Harry said, “A good man knows his limitations.”

However, I think Sirott may have interviewed a big wig, or two, over the last year [Mayor Daley?] and now, Sirott has added Gov. Blagojevich to his resume. Maybe the big guys think they can control Sirott, or at least they can expect softballs and T-Balls from Bob-- so they request Sirott and WTTW obliges? What else did Blago’s folks ask for and get from the Friday Night Show?

This time around, Sirott seemed to turn the 30 minute interview into an infomercial for Blago. Not much substance to the questions, not much follow-up and not much interview. I kept looking around for the Vegematic- it splices, it dices, it…How’s that for a WTTW commercial, or whatever Chicago’s once proud public television station now calls its non-commercial commercials.

For his last question, Sirott asked Blagojevich if he could really be happy without running for POTUS [President of the United States], as the staffers on "Left Wing," I mean "West Wing," like to refer to Jed Bartlett.

Hot Rod seemed to have a ready answer for that T-Ball, but not just as to why Blago was too high minded to even think about that in such tough budget times, as these. No, Hot Rod, was ready to lecture the viewers on how those mean old corporate robber barons were taking the funding for the teachers and books right out of the classroom. Huh? Yes, really. Blago went that far. Have you no shame, Blago? [As Jim Ryan said to Hot Rod during the WTTW gubernatorial debate; it was the high point of Jim’s campaign, if not political career] See the transcript of the closing portion of the Sirott interview, below this rant of mine, for the actual phrasing of Blago's rant against the Illinois corporate robber barons.

Hot Rod, apparently having gone from mastering the list of Presidents to mastering Illinois’ fiscal trends, tells us that from 1980 to the present, the SHARE of total income taxes in Illinois paid by corporations has declined from 20 % to
10 %. Also, over a similar, but not identical, time period, 1976 to 1996, the SHARE of total spending by the State of Illinois Government on education in Illinois has declined from 48% to 32%, argued Blago. [BTW, state taxes currently account for about 7 billion dollars in Illinois education spending, feds for about 3 billion dollars and local property taxes for about 10 billion dollars, meaning we spend about 20 billion dollars on K-12 public schools to educate about 2.2 million kids in Illinois; or an average of about $9,000 per kid across the state, which is a little lower than the $11,200 per kid spent in the Chicago Public Schools]. Why do you suppose Blago was using 1976 to 1996 for his trend line? Wouldn't, say 1980 to 2004, be more consistent with the rest of his argument?

As an aside, didn't Gov. George Ryan, from 1998 to 2002, increase state government funding of education significantly in Illinois? I seem to remember George saying 51 cents of every new dollar spent by state government was to go to education, as if that would somehow improve the quality of education.

With no factual support provided or cited, and of course unchallenged and uninterrupted by Sirott, Blago tells us the above referenced “corporate tax breaks,” came “at the expense of funding education.” Where does Blago get this stuff? Blago's answer to a 15 second question rolled on for about 3 minutes, uninterrupted by Sirott. A set-up?

If Blago were facing a serious interviewer, here are a few things he might have been asked:

Most importantly, three primary questions:

1. Is it the case that from 1976 to 2004, the absolute level of spending on education in Illinois by the state government increased dramatically, but not as fast as that of the absolute level of spending on education in Illinois by local school districts. Did those local school districts choose to ramp up their spending on education and corresponding local property taxes dramatically, resulting eventually in the state legislature passing tax caps, circa 1995. Isn’t that a lot of what is going on, here? Blago’s Illinois constituents [especially suburbanites] prefer, for a variety of reasons, to finance education, through local taxes, which gives them greater local control of education? Isn't this the very accountability that Blago says he favors and purportedly was behind his desire to be given the power to dismiss State Board of Education members at will, or was something else at work there?

2. Blago speaks as if he thinks a corporation is a physical entity with a pot of money to pay taxes. He seems to think if only he could tax [soak] the companies, he could lessen the tax burden on individuals. However, the incidence of taxes on corporations falls on individual taxpayers, including shareholders-- who would pay in the form of lower dividends or lower stock appreciation; employees- who would pay in the form of lower wages and greater unemployment; and customers—who would pay in the form of higher prices. In short, corporations don't so much as "pay," taxes as they "collect," taxes for the government from people. There ain’t no such thing as a free lunch. TANSTAAFL.

3. Is Blago aware of the academic studies done by University of Chicago economists, and others, indicating that the the greater the share of education funding coming from local school districts, the greater the quality of education [presumably reflecting the benefits of greater accountability by local entities than by state or federal entities].

And three questions of lesser importance, if we had time to ask Blago:

4. Did the share of income taxes paid by corporations decline as a percentage of all income taxes paid by individuals and businesses, or was the declining ratio the percentage of all taxes paid by individuals and businesses in Illinois? In other words, do the Governor's numbers reflect business income taxes declining or total business and individual taxes increasing, with the corporate income tax becoming a less important component of all Illinois taxes as a result of the growth of other taxes and not as a result of the growth of "corporate tax loopholes," as Blago likes to say.

5. Were total business income taxes paid in Illinois decreasing because major companies were leaving Illinois? or because such companies moved their headquarters out of Illinois?

6. Has tax law changed, in general, in terms of how national companies have their income tax liability allocated among the states in which they do business? Or, in which they are headquartered? Due to these and other tax law changes during the last twenty years, or so, did the companies doing business in Illinois pay greater state income taxes in other states, over time, and less in Illinois?

Now, that would be a tough, but fair, interview. Moreove, I think one could make it entertaining, provocative and informative- and it could be done in a manner that would increase WTTW's ratings. But, who that would be who could ask such questions in an interview of the Governor, I just don’t know. I just don’t know.

Although, I did interview the Governor once or twice, but never in our studio. Blago cancelled his scheduled studio appearance on "Public Affairs," at the last minute, but, to his credit, gubernatorial candidate Blago gave me a "make-up," 40 minute interview. The interview was done with the two of us standing side by side, in the Winnetka Community House, after he spoke during the 2002 Primary to the New Trier Township Democratic Organization, seeking their endorsement-- which was given, of course, to Paul Vallas. The interview was not a bad one, and we edited it into a 30 minute show.

However, interviews never are quite as good when done outside the studio. You always have the fear that if you get too tough, the guest may suddenly remember he has to be somewhere else [Indeed, this actually happened with Colin Powell when he was doing a Satellite interviw on Meet the Press a few weeks ago from Jordan. A Powell staffer thought Russert's last question was too tough and shifted the direction of the camera away from Powell to a Palm tree. To the credit of Powell, he directed the staffer to bring the camera back to him, and he answered Russert's last question. It looked, however, like something from SNL].

On the other hand, I have done 303 studio shows, and I have never had a guest walk off the set before the show concluded. Not yet, at least. Governor Blagojevich, of course, is quite capable of answering tough questions. Too bad WTTW didn't ask them. Another squandered 30 minutes by WTTW. has a very interesting, recent piece [Illinois Budget Legislative Session] indicating that Blago has been outsmarted on the budget by Speaker Madigan. Perhaps, but I will be interested to see if Blago has yet another rabbit to pull out of his hat by the end of Memorial Day. Blago may be no Bill Clinton, but like “W,” Blago benefits from being consistently underestimated, intellectually and otherwise, by his political opponents.

Bob Sirott: I know you have your hands full right now, and you are thinking about this job and nothing else, but—

Gov. Rod Blagojevich: Nothing else.

Sirott: But, knowing what I know about you, can you ever really be completely content professionally in your life if someday, many years from now, you don’t run for President [of the United States]?

Blagojevich: I appreciate that question. God save the Republic.

Sirott: [Laughter] And, by the way, feel free to announce your candidacy-- right here.

Blagojevich: Well, I am for Kerry, by the way. No, I don’t think like that. I know a lot of people talk like and say that. I think anybody who is the Governor of the 5th largest state and now that Arnold Schwarzanegger was elected [Governor] in California--there is no longer a Democrat Governor in California-- Illinois is the largest state with a Democrat Governor in it. And, so I think naturally there is going to be some speculation that the person, whoever he or she might be, who is in this position in Illinois, might have those kind of aspirations or could be on somebody’s list at some point in time. But, Illinois has so many difficult challenges. We have got the worst fiscal crisis in our state’s history that we are working on; there is a progressive agenda that I am trying to move forward-- as we deal with these budget deficits. We are trying to undo a generation of misplaced priorities.

You know, back in 1980, for every five dollars that came into the state by way of the income tax, one dollar was paid by corporations, and then, nearly twenty five years later, we find ourselves where for every dollar that a corporation pays, it’s nine dollars [that] is paid by working people. So, while the corporations and some of the big companies through their lobbyists and accountants and lawyers have been able to get special tax breaks at the expense of working people, at the same time, there has been a diminution in education funding from the state. In 1976, the last time- while when Dan Walker left- I am loath to almost use that example, but the state share of education spending was 48 cents on every dollar. Hmmm, 20 years later, in 1996, that share went down to 32 cents on every dollar. So, as the corporate tax breaks were increasing in Illinois, it was coming at the expense of funding education. We are fighting within this budget to change those priorities, that’s what you are seeing here.

Last year, we invested 400 million dollars in new spending for education, in spite of a 5 billion dollar budget deficit, without an income tax or sales tax increase. This year we are asking for another 400 million dollars in new spending for education without an income tax or sales tax increase by closing corporate loopholes, prisons we don’t need and other consolidations. Those battles and those fights take 24 hours a day, 7 days a week and so, I have no time to think about anything like that. And, again, [Ah, shucks] I just want to be the best possible [darned] Governor I can be.

Sirott: Thank you for your time. It is good to see you again.

Blagojevich: Thank you, Bob. Thanks for having me.

Sirott: All the best to you and your family and I hope you will come back and see us, again.

Blagojevich: Look forward to it.

Sirott: And, that’s the Friday night show. We’ll be back, Monday night, at 7:00 [pm]—on Chicago Tonight, until then, for all of us on the late shift here at Ch. 11, thanks for watching, have a great Week-end.
Chicago Tonight’s Friday night show, WTTW, Aired on May 28, 2004; Taped on an undisclosed date.
Jeff Berkowitz, Host and Producer of "Public Affairs," can be reached at: