Published on October 22, 2009 by Thomas Messner
Abstract: Supporters of Proposition 8 in California have been subjected to harassment, intimidation, vandalism, racial scapegoating, blacklisting, loss of employment, economic hardships, angry protests, violence, at least one death threat, and gross expressions of anti-religious bigotry. Arguments for same-sex marriage are based fundamentally on the idea that limiting marriage to the union of husband and wife is a form of bigotry, irrational prejudice, and even hatred against homosexual persons. As this ideology seeps into the culture more generally, individuals and institutions that support marriage as the union of husband and wife risk paying a price for that belief in many legal, social, economic, and cultural contexts.
Support for Proposition 8, the democratically established marriage amendment in California, has come with a heavy price for many individuals and institutions that think that marriage should remain the union of husband and wife. Publicly available sources, including evidence submitted in a federal lawsuit in California,[1] show that expressions of support for Prop 8 have generated a range of hostilities and harms that includes harassment, intimidation, vandalism, racial scapegoating, blacklisting, loss of employment, economic hardships, angry protests, violence, at least one death threat, and gross expressions of anti-religious bigotry. Because the issue of marriage is still very much alive in California and throughout the nation,[2] the naked animus manifested against people and groups that supported Prop 8 raises serious questions that should concern anyone interested in promoting civil society, democratic processes, and reasoned discourse on important matters of public policy, such as marriage.
Donor Disclosure Laws in the Internet Age
Much of the hostility directed against Prop 8 supporters has been facilitated by a California law that requires the disclosure of certain personal information of individuals who donate $100 or more in support of or opposition to a ballot measure. Information subject to disclosure includes the donor's full name, occupation, and employer.[3] Once this information is disclosed to the State of California, the state then publishes this information on its Web site, enabling anyone with Internet access to view detailed donor reports online in html format or in a downloadable Microsoft Excel spreadsheet.[4]
With this information at hand, several Web sites have been designed that facilitate the easy identification and targeting of Prop 8 supporters. For example, one of these Web sites is a GoogleMaps "mashup" that combines donor information with an interactive map, allowing activists to ascertain the identity, employer, amount of donation, and approximate location of certain Prop 8 supporters in particular geographic areas.[5] A Web site called "Californians Against Hate" highlights particular Prop 8 supporters in its "Dishonor Roll" and provides addresses and telephone numbers for some of them.[6] At least one Web site allows users to search for Prop 8 supporters who work in their businesses.[7]
Because of the California donor disclosure law, some Prop 8 supporters have become targets without ever placing a sign in their yard, putting a sticker on their car, or appearing at a public rally. These more public forms of support for Prop 8 certainly generated plenty of animosity, as documented below. However, many individuals became targets for harassment, intimidation, and reprisals simply for donating $100 or more in support of Prop 8.
Vandalism and Sign Theft
Many reports of hostility toward Prop 8 supporters involve acts of vandalism. An elderly couple who put a Yes on 8 sign in their yard had a block thrown through their window.[8] A senior citizen who placed a pro-Prop-8 bumper sticker on her car had her car's rear window smashed in.[9] Some individuals with pro-Prop-8 bumper stickers had their cars keyed.[10] One woman with a "One Man, One Woman" bumper sticker had her car keyed and tires deflated while she was in a grocery store.[11] One man who placed signs in his yard and stickers on his cars and motorbike reported that someone egged and floured his home three times and egged, floured, and honeyed his car twice.[12] Someone also pushed over the man's motorbike and scraped the bumper stickers off the back glass windows of his cars.[13] Several other individuals reported that Yes on Prop 8 bumper stickers were scraped or ripped off their vehicles or defaced.[14]
Some individuals found their property vandalized with spray paint. Vandals spray-painted vehicles, garages, fences, and Yes on 8 signs in Yucaipa, California.[15] An Alta Loma resident who placed a Yes on 8 sign in her yard found the words "love for all" and "no on 8" spray-painted on her fifth-wheel trailer.[16] In San Jose, vandals spray-painted the garage doors of two homeowners who displayed signs supporting Prop 8.[17] Vandals also spray-painted anti-Prop-8 messages on commercial and residential buildings in Fullerton.[18]
Other forms of vandalism were more bizarre. One woman who placed a pro-Prop-8 sign on her balcony reported finding that her staircase leading downstairs had been covered in urine.[19] She also found a puddle of urine at the bottom of the stairs.[20]
Vandals also hit houses of worship. Perpetrators used orange paint to vandalize a statue of the Virgin Mary outside one church.[21] Offices at the Cornerstone Church in Fresno were egged.[22] Swastikas and other graffiti were scrawled on the walls of the Most Holy Redeemer Catholic Church in San Francisco, a parish known widely as being "gay-friendly."[23] In San Luis Obispo, the Assembly of God Church was egged and toilet-papered, and a Mormon church had an adhesive poured onto a doormat and keypad.[24] Signs supporting Prop 8 were twisted into a swastika at Our Lady of Perpetual Help Catholic Church in Riverside.[25] Someone used a heavy object wrapped with a Yes on 8 sign to smash the window of a pastor's office at Messiah Lutheran Church in Downey.[26]
In addition, reports of Yes on Prop 8 signs being defaced, damaged, dislocated, or stolen are almost too numerous to track reliably.[27] According to one source, the Yes on 8 campaign estimated that approximately one-third of an estimated 25,000 signs distributed in California were stolen or vandalized before the campaign ended.[28] Prop 8 supporters who replaced stolen signs often had their signs stolen again.[29] Sign thefts also often involved the added element of trespass or fear of trespass.[30] In some cases, perpetrators crossed fences and walls to steal signs or removed signs that had been securely fastened in place.[31] One individual reported coming home late and hearing male voices outside her home.[32] Another individual reported that a suspected perpetrator quickly drove away when spotted through the front window of his house.[33]
Harassment, Hostility, and Slurs
Several individuals who supported Proposition 8 reported receiving harassing telephone calls, e-mails, and mailings. Prop 8 supporters have reported receiving phone calls and voice mails calling them "bigot"[34] and using vulgar language.[35] Sometimes harassers called at work.[36] A public relations firm hired by the Yes on 8 Campaign received so many harassing phone calls from one person that the sheriff's office became involved.[37] Other Prop 8 supporters received e-mails, letters, and postcards using vulgar language[38] and offensive labels like "gay hater."[39] Through the contact form on his business's Web site, one individual received an e-mail stating "burn in hell."[40] One e-mail threatened to contact the parents of students at a school where a particular Prop 8 supporter worked.[41]
Harassment sometimes took other forms. For example, two women painted an arrow and the words "Bigots live here" on the window of an SUV and parked the vehicle in front of a household that had supported Prop 8.[42] In another case, an individual who supported Prop 8 found himself the subject of a flyer distributed in his town. The flyer included a photo of him, labeled him a "Bigot," and stated his name, the amount of his donation to Prop 8, and his association with a particular Catholic Church.[43] At the University of California, Davis, a Yes on 8 table on the quad was reportedly attacked by a group of students throwing water balloons and shouting "you teach hate."[44] A professor at Los Angeles City College allegedly told students in his class, "If you voted yes on Proposition 8, you are a fascist [expletive deleted]."[45] One Prop 8 supporter received a book, sent anonymously through Amazon.com, that contained "the greatest homosexual love stories of all time."[46]
Prop 8 supporters holding signs in public places also reported incidents of notable hostility. One woman who stood near a street with a Yes on 8 sign reported that a man stopped his car and shouted at her, "You despicable filthy bag of [expletive deleted]."[47] Other drivers circled the block and yelled things like "You [expletive deleted]" each time they drove by her.[48] Once a car with several men stopped, and a man in the back seat opened the door and threw something at her.[49] Another driver stopped her car and yelled, "Get the [expletive deleted] out of here. Who do you think you are, bringing that hate into my neighborhood?"[50] One Prop 8 supporter who witnessed repeated vulgarities at sign-waving events said she felt nervous and scared and chose not to take her children with her.[51] Another Prop 8 supporter concluded that in the future she would make sure that at least one man was with each group of wavers to ensure the protection and safety of the teenagers who participated.[52]
Prop 8 also triggered hostility against African-Americans, who were reported to have supported the ballot measure by large margins. "According to eyewitness reports published on the Internet," states one news source, "racial epithets have been used against African Americans at protests in California -- with some even directed against blacks who are fighting to repeal Prop. 8."[53] One man, for example, reported he was called a particular racial slur twice and said the anti-Prop-8 protest he attended "was like being at a klan rally except the klansmen were wearing Abercrombie polos and Birkenstocks."[54] Another man reported that "he and his boyfriend, who are both black, were carrying NO ON PROP 8 signs and still subjected to racial abuse."[55]
"Mormons in the Crosshairs" [56]
Mormons were particularly and systematically targeted for supporting Prop 8. One leading gay-rights activist in West Hollywood said, "The main finger we are pointing is at the Mormon church'"[57] Joe Solmonese, head of the Human Rights Campaign, echoed this sentiment on the Dr. Phil show when, in response to a question from a Mormon audience member asking why his church was being targeted, he reportedly declared, "We are going to go after your church every day for the next two years unless and until Prop 8 is overturned."[58] At least one of the Web sites targeting Prop 8 donors focuses specifically on Mormons.[59] And one anti-Prop-8 activist has filed a complaint asking California officials to investigate the Church of Jesus Christ of Latter-day Saints for its support for the marriage amendment.[60]
The "Home Invasion" television ad, in particular, sought to exploit anti-Mormon bigotry for political gain. The ad depicts two Mormon missionaries invading the home of a lesbian couple, ransacking their belongings, and tearing up their marriage license. "Hi, we're from the Church of Jesus Christ of Latter-day Saints," says one of the Mormon missionaries. "We're here to take away your rights," says the other. The ad concludes with script and a voiceover stating, "Say NO to a Church taking over your government. Vote NO on Proposition 8."[61] This manifestation of undisguised religious bigotry undoubtedly caused great concern to many people. The Los Angeles Times, on the other hand, lamented that same-sex marriage activists had failed to air more "hard-hitting" ads like it.[62]
After Prop 8 passed, crowds of same-sex marriage activists congregated for protests at Mormon houses of worship throughout the nation.[63] One video shows same-sex marriage activists massed outside the Mormon temple in New York City crying "fascist church" repeatedly.[64] Another video appears to show angry activists rattling the gates of the temple in Los Angeles and chanting "shame on you."[65] Images from various protests show signs like "Mormon Scum,"[66] "Get your filthy church off me,"[67] and "Keep your hate in Salt Lake."[68]
Anti-Mormon malice reached a new level when someone mailed packages containing suspicious white powder to Mormon temples in California and Utah.[69] At least one of those incidents triggered a domestic [70] Meanwhile, in Colorado, perpetrators placed a Book of Mormon on the steps of a Mormon church and lit it on fire.[71] Police reportedly investigated the incident as a "bias-motivated arson" related to the church's position on Prop 8.[72]
Violence and Threats of Violence
Some of the animosity directed against people and groups that supported Prop 8 was openly threatening or even violent. In Modesto, for example, a Prop 8 supporter was allegedly punched in the face by someone who had stolen several Yes on 8 signs. According to news reports, Jose Nunez, who became a U.S. citizen just months before Prop 8 passed, was waiting to distribute signs outside his Catholic church when a man grabbed several Yes on 8 signs and fled.[73] When Nunez followed the thief and tried to recover the signs, the thief reportedly yelled "What do you have against gays?" and punched Nunez in the face.[74] According to Prop 8 supporters, Nunez suffered a bloody eye and wounds to his face and was taken by ambulance to a local hospital "where he received 16 stitches under his eye."[75]
In Fresno, the town mayor received a death threat for supporting Prop 8. The threat stated, "Hey Bubba, you really acted like a real idiot at the Yes of [sic] Prop 8 Rally this past weekend. Consider yourself lucky. If I had a gun I would have gunned you down along with each and every other supporter."[76] The threat also mentioned a "little surprise" for a local pastor who supported Prop 8 and "his congregation of lowlife's" [sic]. "Keep letting him preach hate and he'll be sorry," the perpetrator threatened. "He will be meeting his maker sooner than expected."[77] The threat also stated that anyone in Fresno displaying a Yes on Prop 8 yard sign or bumper sticker was "in danger of being shot or firebombed."[78] Police took the threat seriously, launching a criminal investigation and taking extra steps to protect the mayor and pastor.[79]
In another incident, an elderly woman in Palm Springs was besieged by an angry mob protesting Prop 8. Video footage posted on the Internet shows several men shouting at the woman as a television reporter tries to interview her.[80] "Get out of here," one man shouts in the elderly woman's face.[81] Later the video shows the woman, who is carrying a large cross at this point, surrounded by several men, including at least one who knocks the cross out of the woman's hands and stomps on it.[82] Someone also reportedly spit on the 69-year-old lady.[83]
A small group of Christians encountered similar hostilities when an angry crowd apparently took them for pro-Prop 8 demonstrators as they prayed and sang hymns on a sidewalk in the Castro District of San Francisco.[84] One of the Christians reportedly later stated that the people in the crowd shouted words like "haters" and "bigots" and then "started throwing hot coffee, soda and alcohol on us and spitting (and maybe even peeing) on us."[85] Someone in the crowd allegedly threatened to kill the group's leader, and someone else allegedly tried to pull down the pants of one of the men in the group.[86] A woman in the group was allegedly struck on the head with her own Bible before being thrown to the ground and kicked.[87] Video footage posted on the Internet shows a band of police officers dressed in riot gear fending off the angry crowd and escorting the Christians to safety.[88]
Employees and Business Owners Targeted
Same-sex marriage activists have also targeted the places where Prop 8 supporters work. Businesses and other institutions that employ individuals who personally donated to Prop 8 have been threatened with and in some cases subjected to picketing, protests, and damaging boycotts. Some Prop 8 donors resigned from their jobs or took a leave of absence to protect their employers and colleagues.
For example, Scott Eckern was employed as the director of the nonprofit California Musical Theater in Sacramento before being targeted for personally donating $1,000 to Prop 8. Once Mr. Eckern's support for Prop 8 was discovered, the theater was "deluged" with criticism from prominent artists who opposed Prop 8.[89] Critics included Marc Shaiman, the composer of Hairspray, who stated that his work could not be performed at the theater because of Mr. Eckern's support for Prop 8.[90] Mr. Eckern resigned.[91]
Richard Raddon was the director of the Los Angeles Film Festival before he landed in the crosshairs of Prop 8 opponents. Mr. Raddon personally donated $1,500 to Prop 8. As in the case of Mr. Eckern, once information about Mr. Raddon's personal donation was disclosed to the state and published on the Internet, he became a target of Prop 8 opponents.[92] According to an op-ed in The Wall Street Journal, "A threatened boycott and picketing of the next festival forced him to resign."[93]
The extreme nature of this crude, but effective new tactic was poignantly illustrated in the case of Marjorie Christoffersen, a 67-year-old restaurant employee who donated a mere $100 to Prop 8.[94] Once information about Ms. Christoffersen's $100 donation was published on the Internet, Prop 8 opponents launched a protest against the restaurant where she worked, prompting the restaurant to offer activists a free brunch and Ms. Christoffersen to offer an apology.[95] However, when Ms. Christoffersen refused to renounce her support for Prop 8 -- like Scott Eckern and Richard Raddon, Marjorie Christoffersen is a Mormon -- the meeting "turned ugly" and "[b]oisterous street protests erupted that night."[96] Ms. Christoffersen eventually decided to take a leave of absence to protect the restaurant, which is owned by her mother, and the other employees who worked there.[97]
In other cases, business owners who supported Prop 8 either personally or through their enterprises have had their businesses targeted for reprisals by same-sex marriage activists. A dentist in Palo Alto lost patients because he donated $1,000.[98] Purves & Associates, an insurance company in Davis, was picketed with signs such as "Purves Family Supports Homophobia" after family members donated to Prop 8.[99] Protesters rallied and handed out free ice cream to retaliate against a family-owned creamery that supported Prop 8.[100] Activists boycotted the Grand Hyatt hotel in San Diego because its developer donated money to help to put Prop 8 on the ballot.[101] Same-sex marriage activists also targeted a self-storage company because its owner and his family donated money to Prop 8.[102]
Boycotting businesses that engage in commercial behavior consumers find objectionable is a time-honored form of activism in American society. However, targeting businesses for the political and religious views of their owners or even their employees -- and the decision of these individuals to participate in democratic political processes -- has raised serious concerns about the state of public discourse regarding marriage and the condition of civil society generally. No individual should be compelled to choose between making a living and participating in democratic processes affecting fundamental matters of public concern, such as marriage.
Beyond Prop 8
The weeks and months after Prop 8 passed also witnessed other incidents of hostility directed against expressions of support for traditional views on marriage and homosexuality. Some of these incidents were not directly connected with support for Prop 8, which suggests, grimly, that some of the hostilities described in this paper could become more common in political contests concerning same-sex marriage and other issues involving homosexuality.
In one disturbing incident just days after Prop 8 passed, a radical group called "Bash Back!" allegedly invaded a Christian church in Michigan. The group's Web site featured photos of members dressed like terrorists and brandishing various objects as weapons.[103] A press release posted by the Alliance Defense Fund, a public interest legal association that is suing the openly anarchist group in federal court, states:
[M]embers of the group dressed in militant garb staged a protest outside the church during a worship service to distract security personnel, blocking access to the building and parking lot at various times. Other members of the group dressed in plain clothes then deceptively entered the building. At a coordinated time, they sprang up to disrupt the service, terrifying many attendees. The group shouted religious slurs, unfurled a sign, and threw fliers around the sanctuary while two women began kissing near the podium. The group pulled fire alarms as they ran out of the building.[104]
In accounts allegedly posted on the Internet after the invasion, Bash Back! described the Mount Hope Church as a "deplorable, anti-queer mega-church" that is "complicit in the repression of queers in Michigan and beyond"[105] and cited the church's "stance on queer identities" as one reason for the attack.[106]
Another case, more widely reported than the church invasion in Michigan, involved Carrie Prejean, the Miss USA beauty contestant. Ms. Prejean was competing in the final round of the Miss USA pageant when she drew a question from pageant judge Perez Hilton about legalizing same-sex marriage.[107] Ms. Prejean's answer -- that, in her view, marriage should be between a man and a woman -- generated a tidal wave of criticism, including from Mr. Hilton, who later described Ms. Prejean in crude and derogatory terms in a video blog on his Web site.[108] A co-director of the Miss California association also condemned Ms. Prejean, stating that "[r]eligious beliefs have no place in politics in the Miss CA family."[109] Both Ms. Prejean and Mr. Hilton have speculated that her answer cost her the crown.[110]
Lessons of Prop 8 Hostilities
Several anti-Prop-8 activists have condemned certain types of hostility described in this paper.[111] Some of the incidents described in this paper have involved illegal conduct, meaning the wider community has already condemned it. Some acts of hostility have been perpetrated by random individuals acting in isolation or by unpredictable crowds expressing anger and frustration.
Yet none of these facts changes the reality that many Prop 8 supporters have paid a considerable price for defending marriage as the union of husband and wife. Indeed, no matter who is to blame for the hostility surrounding Prop 8, one lesson of Prop 8 cannot be denied: Individuals or institutions that publicly defend marriage as the union of husband and wife risk harassment, reprisal, and intimidation -- at least some of it targeted and coordinated.
Furthermore, although some same-sex marriage activists have expressed disagreement with certain types of conduct described in this paper, few activists would disavow the ideology underlying much of the outrage at Prop 8's success. Arguments for same-sex marriage, although often couched in terms of tolerance and inclusion, are based fundamentally on the idea that preserving marriage as unions of husband and wife is a form of bigotry, irrational prejudice, and even hatred against homosexual persons who want the state to license their relationships. As increasing numbers of individuals and institutions, including public officials and governmental bodies, embrace this ideology, belief in marriage as a relationship between a man and a woman likely will come to be viewed as an unacceptable form of discrimination that should be purged from public life through legal, cultural, andeconomic pressure.
Other sources have explained how changes in law based on this ideology will threaten the religious liberties of individuals and institutions that interact with the government or become subject to nondiscrimination laws.[112] The hostility surrounding Prop 8 shows how, once this ideology seeps into the culture more generally, individuals and institutions that support marriage as the union of husband and wife risk paying a price for that belief in many legal, social, economic, and cultural contexts.
Conclusion
When people stand firmly by their beliefs about marriage as the union of husband and wife despite facing social stigmatization, economic hardship, and other reprisals, they provide an important example of civic courage and inspire particular virtues that are essential to the proper functioning of any free and open society. The freedom of parties on both sides of the marriage debate to voice their views and to promote them in public policy should be respected.
Thomas M. Messner is a Visiting Fellow in the Richard and Helen DeVos Center for Religion and Civil Society at The Heritage Foundation.
http://www.heritage.org/research/reports/2009/10/the-price-of-prop-8
Wednesday, April 7, 2010
All the Presidents Budget Gimmicks
Published on March 16, 2010 by Brian Riedl President Obama's new budget proposal would raise taxes by $3 trillion over the decade — and still double the national debt.
He inherited unsustainable Social Security, Medicare, Medicaid and net interest costs, but instead of paring spending back, decided to pile on trillions of dollars in new health care, education and energy spending. Even the historic tax increases proposed by the president would cover only a fraction of these new costs. By 2020 — even assuming peace and prosperity — the budget deficit would still top $1 trillion. At that point, more than one-third of all income taxes would be needed just to pay the interest on this debt.
Yet it could be even worse.
Mr. Obama deserves credit for reversing President Bush's budget gimmicks of not budgeting for the Alternative Minimum Tax patch, the global war on terrorism and future unanticipated emergencies. But his budget contains numerous large gimmicks of his own:
• Rosy economic scenario: Just like last year, the president's new budget assumes a rosy economic scenario. The White House projects a 2011 economic growth rate double the rate forecasted by the Congressional Budget Office (CBO). Overall, White House projects that in 2020 the economy will be nearly $1 trillion larger (adjusted for inflation) than the CBO estimates. If the economy performs closer to the CBO projections, it will raise budget deficits even higher.
• Excluding cap-and-trade costs: Last year, the president simply excluded the cost of his health plan from his aggregate budget tables. This year, he budgeted for his health care plan, but removed the costs of his cap-and-trade plan, even though he has endorsed the House-passed bill that would raise taxes by $846 billion, and spending by $822 billion. The $3 trillion tax-increase figure above incorporates this cost.
• A $132 billion "magic asterisk": The president's budget vaguely claims $132 billion in "program integrity" savings. The White House says this includes cleaning up waste in entitlement programs and increasing Internal Revenue Service enforcement of tax laws.Of course, government waste is easy to identify and difficult to eliminate. The federal government's track record on rooting out waste is abysmal, and promises to close the "tax gap" of unpaid taxes have not translated into progress.
• $23 billion terminations and cuts?: Mr. Obama also hypes his $23 billion in proposed spending cuts and terminations (less than 1 percent of all spending). He doesn't mention that last year, every dollar saved from his $7 billion in spending cuts went into new government spending. Not a dollar went toward deficit reduction. And this year he proposes more of the same. Using "low-hanging fruit" budget cuts for new spending means that more of the higher taxes or spending cuts down the road must come from the remaining higher-priority policies.
• The baseline assumes war spending rises forever: Repeating his much-maligned gimmick from last year's budget, the president first creates a fantasy baseline that assumes the Iraq surge continues forever (which was never U.S. policy), and then "saves" $728 billion against that baseline by ending the surge as scheduled under his policies. It is like a family "saving" $10,000 by first assuming an expensive vacation and then not taking it.
• Low-balling discretionary spending: Mr. Obama wisely proposed temporarily freezing a small sliver of discretionary funding (albeit at an inflated level). However, over the next decade, the president assumes that non-war, non-emergency discretionary spending will expand by 30 percent, just slightly faster than inflation. But in reality, discretionary spending surged by 104 percent during the past decade. The free-spending Democratic Congress provides no reason to expect sudden austerity. If discretionary spending instead grows at the same rate as the economy (about 5 percent nominally per year), it would add about $400 billion to the 2020budget deficit.
• PAY-GO: Mr. Obama bases much of his proposed budget restraint on his new "pay-as-you-go" (PAY-GO) law. While the PAY-GO concept — that Congress must offset the cost of any new initiative — sounds promising, its glaring loopholes mean it won't reduce the deficit at all. PAY-GO exempts all discretionary spending (which makes up 40 percent of the budget) from its constraints. It exempts the automatic annual growth of Social Security, Medicare and Medicaid, which threatens Washington's long-run solvency. It exempts the endless stream of emergency "stimulus" bills. When PAY-GO is violated, nearly all spending is exempt from being cut to offset the new expansions. PAY-GO is designed to serve more as a talking point than as a tool for deficit reduction.
• Deficit Commission: Rather than take the lead and propose entitlement reforms that would reduce the deficit, the president has appointed a commission to devise a plan. While some commissions may be useful, this one likely will not. The deficit commission currently plans to write its recommendations in a back room without public hearings or public buy-in. These recommendations won't be unveiled until after the election, where they would be voted on by a lame-duck Congress — if they are even voted on at all. (There is no "fast-track" procedure guaranteeing a vote.) The American people will be unlikely to embrace major tax and spending changes thrust upon them with so little transparency and voted on by an unaccountable lame-duck Congress.
• Brian Riedl is Grover M. Hermann Fellow in Federal Budgetary Affairs at the Heritage Foundation (www.heritage.org).
http://www.heritage.org/Research/Commentary/2010/03/All-the-Presidents-Budget-Gimmicks
He inherited unsustainable Social Security, Medicare, Medicaid and net interest costs, but instead of paring spending back, decided to pile on trillions of dollars in new health care, education and energy spending. Even the historic tax increases proposed by the president would cover only a fraction of these new costs. By 2020 — even assuming peace and prosperity — the budget deficit would still top $1 trillion. At that point, more than one-third of all income taxes would be needed just to pay the interest on this debt.
Yet it could be even worse.
Mr. Obama deserves credit for reversing President Bush's budget gimmicks of not budgeting for the Alternative Minimum Tax patch, the global war on terrorism and future unanticipated emergencies. But his budget contains numerous large gimmicks of his own:
• Rosy economic scenario: Just like last year, the president's new budget assumes a rosy economic scenario. The White House projects a 2011 economic growth rate double the rate forecasted by the Congressional Budget Office (CBO). Overall, White House projects that in 2020 the economy will be nearly $1 trillion larger (adjusted for inflation) than the CBO estimates. If the economy performs closer to the CBO projections, it will raise budget deficits even higher.
• Excluding cap-and-trade costs: Last year, the president simply excluded the cost of his health plan from his aggregate budget tables. This year, he budgeted for his health care plan, but removed the costs of his cap-and-trade plan, even though he has endorsed the House-passed bill that would raise taxes by $846 billion, and spending by $822 billion. The $3 trillion tax-increase figure above incorporates this cost.
• A $132 billion "magic asterisk": The president's budget vaguely claims $132 billion in "program integrity" savings. The White House says this includes cleaning up waste in entitlement programs and increasing Internal Revenue Service enforcement of tax laws.Of course, government waste is easy to identify and difficult to eliminate. The federal government's track record on rooting out waste is abysmal, and promises to close the "tax gap" of unpaid taxes have not translated into progress.
• $23 billion terminations and cuts?: Mr. Obama also hypes his $23 billion in proposed spending cuts and terminations (less than 1 percent of all spending). He doesn't mention that last year, every dollar saved from his $7 billion in spending cuts went into new government spending. Not a dollar went toward deficit reduction. And this year he proposes more of the same. Using "low-hanging fruit" budget cuts for new spending means that more of the higher taxes or spending cuts down the road must come from the remaining higher-priority policies.
• The baseline assumes war spending rises forever: Repeating his much-maligned gimmick from last year's budget, the president first creates a fantasy baseline that assumes the Iraq surge continues forever (which was never U.S. policy), and then "saves" $728 billion against that baseline by ending the surge as scheduled under his policies. It is like a family "saving" $10,000 by first assuming an expensive vacation and then not taking it.
• Low-balling discretionary spending: Mr. Obama wisely proposed temporarily freezing a small sliver of discretionary funding (albeit at an inflated level). However, over the next decade, the president assumes that non-war, non-emergency discretionary spending will expand by 30 percent, just slightly faster than inflation. But in reality, discretionary spending surged by 104 percent during the past decade. The free-spending Democratic Congress provides no reason to expect sudden austerity. If discretionary spending instead grows at the same rate as the economy (about 5 percent nominally per year), it would add about $400 billion to the 2020budget deficit.
• PAY-GO: Mr. Obama bases much of his proposed budget restraint on his new "pay-as-you-go" (PAY-GO) law. While the PAY-GO concept — that Congress must offset the cost of any new initiative — sounds promising, its glaring loopholes mean it won't reduce the deficit at all. PAY-GO exempts all discretionary spending (which makes up 40 percent of the budget) from its constraints. It exempts the automatic annual growth of Social Security, Medicare and Medicaid, which threatens Washington's long-run solvency. It exempts the endless stream of emergency "stimulus" bills. When PAY-GO is violated, nearly all spending is exempt from being cut to offset the new expansions. PAY-GO is designed to serve more as a talking point than as a tool for deficit reduction.
• Deficit Commission: Rather than take the lead and propose entitlement reforms that would reduce the deficit, the president has appointed a commission to devise a plan. While some commissions may be useful, this one likely will not. The deficit commission currently plans to write its recommendations in a back room without public hearings or public buy-in. These recommendations won't be unveiled until after the election, where they would be voted on by a lame-duck Congress — if they are even voted on at all. (There is no "fast-track" procedure guaranteeing a vote.) The American people will be unlikely to embrace major tax and spending changes thrust upon them with so little transparency and voted on by an unaccountable lame-duck Congress.
• Brian Riedl is Grover M. Hermann Fellow in Federal Budgetary Affairs at the Heritage Foundation (www.heritage.org).
http://www.heritage.org/Research/Commentary/2010/03/All-the-Presidents-Budget-Gimmicks
Chicago's convention center rivals are suffering
Published on April 6, 2010 3:12 PM
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By Kathy Bergen
While Chicago is singing the convention business blues, its two biggest rivals -- Las Vegas and Orlando -- have reasons to howl even louder, according to attendance data for 2009, when the deep recession kept many conventioneers tethered to their home bases.
Attendance at McCormick Place conventions and trade shows tailed off by nearly 7 percent last year, to 893,068 individuals, according to data released Tuesday. The same year, the Las Vegas Convention Center experienced a 30 percent dive, to 1.1 million attendees, and the Orange County Convention Center took a 21 percent fall, to 781,740. The two Sun Belt facilities also saw a decline in number of events, while Chicago saw a rise last year.
"These are really hefty declines in places where you would not expect it -- in places that systemically have done well," said Heywood Sanders, professor of public administration at the University of Texas at San Antonio.
To some extent, Vegas and Orlando continued to suffer from the so-called "AIG effect," or the backlash stemming from American International Group Inc.'s spending more than $400,000 on a luxury resort excursion shortly after receiving a federal bailout in the fall of 2008.
"Chicago is considered more business-oriented," said Ted Mandigo, a hospitality industry consultant based in Elmhurst. "If you're going to Orlando, you better have had a good year, and if you're going to Las Vegas, you better have had a superb year, because of the image of those two cities [as entertainment centers.]"
Convention officials in those two cities say the economy was the No. 1 factor in their declines, but that corporate America's reluctance to book events in resort locations did hurt the meeting slice of their business.
While Chicago suffered lesser damage in 2009, it faces a steeper uphill climb out of this slump because it has a much smaller budget to lure future shows in an increasingly cutthroat landscape, Mandigo said.
"Chicago has a handicap of funds and that's what's used to subsidize conventions," he said.
The Chicago Convention and Tourism Bureau, a state-aided non-profit that markets McCormick Place, has a sales and marketing budget of $13.8 million, compared with $143 million in Las Vegas and $47 million in Orlando, according to Tim Roby, president and chief executive of the Chicago bureau. He presented those figures last week at a state legislative hearing on how to overhaul the city's struggling convention business.
"Looking forward, legislative changes are paramount if Chicago is to remain a premier meetings and convention destination," Roby said in a prepared statement. The state legislative panel is expected to conduct a second hearing on the issue Wednesday morning at the Thompson Center.
The issue also is being studied by the interim board of the Metropolitan Pier and Exposition Authority, which voted at its first meeting Tuesday to spend up to a total of $190,000 to have two consulting firms assess the cost competitiveness of its operations relative to its chief rivals.
Because the assignment must be completed by later this month, the authority's board awarded the contracts to Pricewaterhouse Coopers and C.H. Johnson Consulting Inc. on an emergency basis, without soliciting competitive bids. The board is aiming to make its recommendations on overhauling operations by the end of April.
While Las Vegas officials say they see anecdotal evidence of economic improvement, Orlando and Chicago officials are predicting a slow recovery.
"The meetings/convention industry typically lags one year behind a major recession," Roby said. "We can expect 2010 to be as soft or softer than 2009."
Kathie Canning, deputy general manager of the Orange County Convention Center in Orlando, says the center is taking a conservative stance, forecasting a flat performance this year and next.
The slump in the trade show business has been nationwide, with the Center for Exhibition Industry Research trade group reporting a 12.5 percent decline in its index, by far the steepest drop in the decade it has been tracking performance.
No doubt the recession played a big role, but there are other factors at work, some of which may persist, even in an economic rebound.
The rising use of technology means potential attendees can review products and listen to seminars online, allowing some to trim their stays at trade shows, or eliminate them altogether.
And exhibitors who reduced the size of their booths during the recession may have grown comfortable with smaller displays, said Doug Ducate, president and chief executive of the Center for Exhibition Industry Research. "Truthfully, the jury is still out," he said.
And the shrinking shows now have more choices of venues large enough to accommodate them, both because the shows themselves are smaller and because there has been a rapid and continuing expansion of convention hall space, Sanders said. This has led to an environment of extreme discounting and increased political pressure to save struggling convention halls, he added.
"This is not just about Chicago," he said. "There are larger, immutable forces at work."
http://www.chicagobreakingbusiness.com/2010/04/mccormick-place-and-mcpier-chicagos-convention-center-rivals-suffer.html
Submit a comment
By Kathy Bergen
While Chicago is singing the convention business blues, its two biggest rivals -- Las Vegas and Orlando -- have reasons to howl even louder, according to attendance data for 2009, when the deep recession kept many conventioneers tethered to their home bases.
Attendance at McCormick Place conventions and trade shows tailed off by nearly 7 percent last year, to 893,068 individuals, according to data released Tuesday. The same year, the Las Vegas Convention Center experienced a 30 percent dive, to 1.1 million attendees, and the Orange County Convention Center took a 21 percent fall, to 781,740. The two Sun Belt facilities also saw a decline in number of events, while Chicago saw a rise last year.
"These are really hefty declines in places where you would not expect it -- in places that systemically have done well," said Heywood Sanders, professor of public administration at the University of Texas at San Antonio.
To some extent, Vegas and Orlando continued to suffer from the so-called "AIG effect," or the backlash stemming from American International Group Inc.'s spending more than $400,000 on a luxury resort excursion shortly after receiving a federal bailout in the fall of 2008.
"Chicago is considered more business-oriented," said Ted Mandigo, a hospitality industry consultant based in Elmhurst. "If you're going to Orlando, you better have had a good year, and if you're going to Las Vegas, you better have had a superb year, because of the image of those two cities [as entertainment centers.]"
Convention officials in those two cities say the economy was the No. 1 factor in their declines, but that corporate America's reluctance to book events in resort locations did hurt the meeting slice of their business.
While Chicago suffered lesser damage in 2009, it faces a steeper uphill climb out of this slump because it has a much smaller budget to lure future shows in an increasingly cutthroat landscape, Mandigo said.
"Chicago has a handicap of funds and that's what's used to subsidize conventions," he said.
The Chicago Convention and Tourism Bureau, a state-aided non-profit that markets McCormick Place, has a sales and marketing budget of $13.8 million, compared with $143 million in Las Vegas and $47 million in Orlando, according to Tim Roby, president and chief executive of the Chicago bureau. He presented those figures last week at a state legislative hearing on how to overhaul the city's struggling convention business.
"Looking forward, legislative changes are paramount if Chicago is to remain a premier meetings and convention destination," Roby said in a prepared statement. The state legislative panel is expected to conduct a second hearing on the issue Wednesday morning at the Thompson Center.
The issue also is being studied by the interim board of the Metropolitan Pier and Exposition Authority, which voted at its first meeting Tuesday to spend up to a total of $190,000 to have two consulting firms assess the cost competitiveness of its operations relative to its chief rivals.
Because the assignment must be completed by later this month, the authority's board awarded the contracts to Pricewaterhouse Coopers and C.H. Johnson Consulting Inc. on an emergency basis, without soliciting competitive bids. The board is aiming to make its recommendations on overhauling operations by the end of April.
While Las Vegas officials say they see anecdotal evidence of economic improvement, Orlando and Chicago officials are predicting a slow recovery.
"The meetings/convention industry typically lags one year behind a major recession," Roby said. "We can expect 2010 to be as soft or softer than 2009."
Kathie Canning, deputy general manager of the Orange County Convention Center in Orlando, says the center is taking a conservative stance, forecasting a flat performance this year and next.
The slump in the trade show business has been nationwide, with the Center for Exhibition Industry Research trade group reporting a 12.5 percent decline in its index, by far the steepest drop in the decade it has been tracking performance.
No doubt the recession played a big role, but there are other factors at work, some of which may persist, even in an economic rebound.
The rising use of technology means potential attendees can review products and listen to seminars online, allowing some to trim their stays at trade shows, or eliminate them altogether.
And exhibitors who reduced the size of their booths during the recession may have grown comfortable with smaller displays, said Doug Ducate, president and chief executive of the Center for Exhibition Industry Research. "Truthfully, the jury is still out," he said.
And the shrinking shows now have more choices of venues large enough to accommodate them, both because the shows themselves are smaller and because there has been a rapid and continuing expansion of convention hall space, Sanders said. This has led to an environment of extreme discounting and increased political pressure to save struggling convention halls, he added.
"This is not just about Chicago," he said. "There are larger, immutable forces at work."
http://www.chicagobreakingbusiness.com/2010/04/mccormick-place-and-mcpier-chicagos-convention-center-rivals-suffer.html
Friday, April 2, 2010
War of words could cause costly lawsuit
April 2, 2010
BY PHIL KADNER
A dispute among politicians seems to make Cook County vulnerable to one of the largest class-action lawsuits in its history. All a lawyer would have to do is point to a letter signed by every member of the Cook County Board of Review that states property tax bills appear to be misleading.
The letter provoked county Assessor James Houlihan on Wednesday to publicly charge that the leader of the county Democratic Party, Joseph Berrios, and Illinois Democratic chairman Michael Madigan are deliberately trying to delay property tax bills from being issued before the Nov. 2 election.
Houlihan contends that property tax increases, particularly for Chicago residents, will be so high they could affect the election. Berrios, in addition to being the county Democratic chairman, decided to run for assessor after Houlihan announced he would not seek re-election. Berrios is also one of three members of the county review board, which makes decisions on property tax appeals.
The letter that he and the two other review board members signed accuses Houlihan of dragging his feet in assessing townships, thereby delaying the tax bills. But the part of the letter that didn't draw much attention has to do with a new way of assessing property in Cook County.
For reasons I still don't fully understand, the county recently changed the assessment process. Homes, once assessed at 16 percent of market value, are now assessed at 10 percent. Commercial property, previously assessed at 36 or 38 percent of market value, is now assessed at 25 percent.
The letter was sent to Commissioner John Daley (D-Chicago), the chairman of the county board's finance committee, and was signed by the board of review members. Here's what it has to say about the new assessment practice: "Unfortunately, there are also significant legal contentions before our agency regarding the constitutionality and legality of the notice provided by the Assessor to taxpayers in conjunction with the 10/25 (percent assessment) Ordinance.
"Nearly all triennial assessment notices indicate that the assessment has been lowered from the previous year or has stayed the same with no increase. "None of the notices of assessment disclose what the prior level of assessment was compared to the new 2009 level of assessment.
"None of the notices of assessment identify that the market value has increased in 2009. All of the assessment notices to homeowners include a press release indicating, 'Due to the first-ever downward market adjustment, residential properties in each suburban township will receive adjustments of their assessed values.'
"These market reductions come as the Assessor's Office is implementing the 10/25 Ordinance. In sum, the legal challenges before us boil down to whether a reasonable person reading their notice of assessment in conjunction with the press release would notice that their market values have increased substantially.
"We are concerned because the terms 'downward market adjustment' and 'market reductions' used by the Assessor certainly would appear to lead a homeowner to the conclusion that their property's market value has decreased ...
"There is a valid argument that most taxpayers will not realize that market values have increased until after there is a shift in tax burden and it is too late for them to exercise their right to appeal." Well, I'm no lawyer, but if that doesn't form a basis for a class-action lawsuit on behalf of all property taxpayers, I don't know what would.
At least two government officials I spoke with Thursday expressed the same concern but refused to go on the record with their comments. And their fear is that any court challenge would delay property tax bills for months - undermining the financial health of school districts, municipalities, library districts and others that depend on that revenue.
Houlihan did not support Berrios in the Democratic primary election and actively sought someone else to run against him. He is rumored to be encouraging county Commissioner Forest Claypool (D-Chicago) to run as an independent against Berrios this fall. The Cook County property tax system is a mess and has been for decades. The average homeowner can't figure out how the county manufactures the numbers for his tax bill.
And that's the way politicians like it. It has been a political tool for years, used in all manner of ways to boost the careers of Cook County officials. Filing appeals of tax bills has generated millions in wealth for certain law firms, including one in which House Speaker Madigan is a partner.
Houlihan and Madigan have been at odds over making permanent a 7 percent cap on equalized assessed value in Cook County. It will be interesting to see if the 10/25 issue even comes up
http://www.southtownstar.com/news/kadner/2136741,040210kadner.article
BY PHIL KADNER
A dispute among politicians seems to make Cook County vulnerable to one of the largest class-action lawsuits in its history. All a lawyer would have to do is point to a letter signed by every member of the Cook County Board of Review that states property tax bills appear to be misleading.
The letter provoked county Assessor James Houlihan on Wednesday to publicly charge that the leader of the county Democratic Party, Joseph Berrios, and Illinois Democratic chairman Michael Madigan are deliberately trying to delay property tax bills from being issued before the Nov. 2 election.
Houlihan contends that property tax increases, particularly for Chicago residents, will be so high they could affect the election. Berrios, in addition to being the county Democratic chairman, decided to run for assessor after Houlihan announced he would not seek re-election. Berrios is also one of three members of the county review board, which makes decisions on property tax appeals.
The letter that he and the two other review board members signed accuses Houlihan of dragging his feet in assessing townships, thereby delaying the tax bills. But the part of the letter that didn't draw much attention has to do with a new way of assessing property in Cook County.
For reasons I still don't fully understand, the county recently changed the assessment process. Homes, once assessed at 16 percent of market value, are now assessed at 10 percent. Commercial property, previously assessed at 36 or 38 percent of market value, is now assessed at 25 percent.
The letter was sent to Commissioner John Daley (D-Chicago), the chairman of the county board's finance committee, and was signed by the board of review members. Here's what it has to say about the new assessment practice: "Unfortunately, there are also significant legal contentions before our agency regarding the constitutionality and legality of the notice provided by the Assessor to taxpayers in conjunction with the 10/25 (percent assessment) Ordinance.
"Nearly all triennial assessment notices indicate that the assessment has been lowered from the previous year or has stayed the same with no increase. "None of the notices of assessment disclose what the prior level of assessment was compared to the new 2009 level of assessment.
"None of the notices of assessment identify that the market value has increased in 2009. All of the assessment notices to homeowners include a press release indicating, 'Due to the first-ever downward market adjustment, residential properties in each suburban township will receive adjustments of their assessed values.'
"These market reductions come as the Assessor's Office is implementing the 10/25 Ordinance. In sum, the legal challenges before us boil down to whether a reasonable person reading their notice of assessment in conjunction with the press release would notice that their market values have increased substantially.
"We are concerned because the terms 'downward market adjustment' and 'market reductions' used by the Assessor certainly would appear to lead a homeowner to the conclusion that their property's market value has decreased ...
"There is a valid argument that most taxpayers will not realize that market values have increased until after there is a shift in tax burden and it is too late for them to exercise their right to appeal." Well, I'm no lawyer, but if that doesn't form a basis for a class-action lawsuit on behalf of all property taxpayers, I don't know what would.
At least two government officials I spoke with Thursday expressed the same concern but refused to go on the record with their comments. And their fear is that any court challenge would delay property tax bills for months - undermining the financial health of school districts, municipalities, library districts and others that depend on that revenue.
Houlihan did not support Berrios in the Democratic primary election and actively sought someone else to run against him. He is rumored to be encouraging county Commissioner Forest Claypool (D-Chicago) to run as an independent against Berrios this fall. The Cook County property tax system is a mess and has been for decades. The average homeowner can't figure out how the county manufactures the numbers for his tax bill.
And that's the way politicians like it. It has been a political tool for years, used in all manner of ways to boost the careers of Cook County officials. Filing appeals of tax bills has generated millions in wealth for certain law firms, including one in which House Speaker Madigan is a partner.
Houlihan and Madigan have been at odds over making permanent a 7 percent cap on equalized assessed value in Cook County. It will be interesting to see if the 10/25 issue even comes up
http://www.southtownstar.com/news/kadner/2136741,040210kadner.article
PEORIA Jobless rate largely unchanged
But west-central Illinois unemployment up significantly from 2009
By Journal Star staff
Posted Apr 01, 2010 @ 09:06 PM
PEORIA — Unemployment rates remained basically steady from January to February throughout west-central Illinois, but still were considerably higher than a year ago, according to figures released Thursday by the Illinois Department of Employment Security.
Many of the counties in the region now have experienced double-digit unemployment for more than a year, those figures showed. It was the 33rd consecutive month unemployment rates increased in the state's metropolitan areas, the Department of Employment Security said.
In the Peoria metropolitan area, unemployment worsened slightly to 13.2 percent, the worst February rate since 1984 - the last time rates stayed in double digits for a sustained period of time - and an increase from 12.9 percent in January. A year earlier, the rate was 9.4 percent in the Peoria region. The rate hit 13.3 percent in February 1984.
In the past year, the Department of Employment Security said, nonfarm payroll jobs went down 10,400 from February 2009. Most of the loss was in manufacturing, which was down 5,700 jobs from a year earlier. Professional-business services lost 1,500 jobs, the leisure-hospitality sector lost 900 jobs, and transportation-warehousing-utilities lost 800 jobs, the state report said.
Peoria County's jobless rate was 13.6 percent in February, up slightly from the January rate of 13.4 percent. It was 9.8 percent in February 2009. The city of Peoria's rate was steady at 13.3 percent in both January and February. A year earlier, it was 9.8 percent.
Tazewell County also saw an increase, from 12.9 percent in January to 13.3 percent in February. It was 9.4 percent in February 2009. A major cause of the increase was that the city of Pekin saw an increase from 15.8 percent in January to 16.6 percent in February. A year earlier, it was 11.3 percent.
Woodford County's rate was 11.3 percent in February, up from 10.8 percent in January. It was 7.4 percent in February 2009. Stark County had the highest rate in the metropolitan area at 14.1 percent, up more than a full percentage point from 12.9 percent in January. It was 10.6 percent a year ago.
Marshall County's rate was 13.1 percent in February, an improvement from the January rate of 13.5 percent. In February 2009, it was 9.2 percent. Of the state's 12 metropolitan areas, only Bloomington-Normal remained below double digits, at 9.5 percent. McLean County was one of only six counties in Illinois below double digits, at 9.5 percent. The lowest rate in Illinois in February was in Brown County, at 6.5 percent. The highest rate was in Boone County, which had a rate of 20.4 percent. The county seat is Belvidere, where a Chrysler Motors plant had massive layoffs over the last two years.
http://www.pjstar.com/news/x905413388/Jobless-rate-largely-unchanged
By Journal Star staff
Posted Apr 01, 2010 @ 09:06 PM
PEORIA — Unemployment rates remained basically steady from January to February throughout west-central Illinois, but still were considerably higher than a year ago, according to figures released Thursday by the Illinois Department of Employment Security.
Many of the counties in the region now have experienced double-digit unemployment for more than a year, those figures showed. It was the 33rd consecutive month unemployment rates increased in the state's metropolitan areas, the Department of Employment Security said.
In the Peoria metropolitan area, unemployment worsened slightly to 13.2 percent, the worst February rate since 1984 - the last time rates stayed in double digits for a sustained period of time - and an increase from 12.9 percent in January. A year earlier, the rate was 9.4 percent in the Peoria region. The rate hit 13.3 percent in February 1984.
In the past year, the Department of Employment Security said, nonfarm payroll jobs went down 10,400 from February 2009. Most of the loss was in manufacturing, which was down 5,700 jobs from a year earlier. Professional-business services lost 1,500 jobs, the leisure-hospitality sector lost 900 jobs, and transportation-warehousing-utilities lost 800 jobs, the state report said.
Peoria County's jobless rate was 13.6 percent in February, up slightly from the January rate of 13.4 percent. It was 9.8 percent in February 2009. The city of Peoria's rate was steady at 13.3 percent in both January and February. A year earlier, it was 9.8 percent.
Tazewell County also saw an increase, from 12.9 percent in January to 13.3 percent in February. It was 9.4 percent in February 2009. A major cause of the increase was that the city of Pekin saw an increase from 15.8 percent in January to 16.6 percent in February. A year earlier, it was 11.3 percent.
Woodford County's rate was 11.3 percent in February, up from 10.8 percent in January. It was 7.4 percent in February 2009. Stark County had the highest rate in the metropolitan area at 14.1 percent, up more than a full percentage point from 12.9 percent in January. It was 10.6 percent a year ago.
Marshall County's rate was 13.1 percent in February, an improvement from the January rate of 13.5 percent. In February 2009, it was 9.2 percent. Of the state's 12 metropolitan areas, only Bloomington-Normal remained below double digits, at 9.5 percent. McLean County was one of only six counties in Illinois below double digits, at 9.5 percent. The lowest rate in Illinois in February was in Brown County, at 6.5 percent. The highest rate was in Boone County, which had a rate of 20.4 percent. The county seat is Belvidere, where a Chrysler Motors plant had massive layoffs over the last two years.
http://www.pjstar.com/news/x905413388/Jobless-rate-largely-unchanged
Decatur area unemployment rate continues unabated climb to 14.6 percent
CHRIS LUSVARDI - H&R Staff Writer
Posted: Friday, April 2, 2010 12:01 am
DECATUR - As the Decatur-area unemployment rate continues to increase, one local business owner questioned just how serious people are about finding jobs.
In more than 34 years working for Dairy Queen, local franchise owner Wendell Bradley said he has never had as many problems hiring staff as he does now. The problems come, even as the Decatur unemployment rate in February rose to 14.6 percent, a 4.5 percentage point increase from last year, according to Illinois Department of Employment Security statistics released Thursday.
The February rate was the highest since 1983, when it was 19 percent. In January, it was 14.4 percent.
"We are struggling to find staff, and I know that just sounds absurd," Bradley said Wednesday during a state jobs task force meeting at the Decatur Civic Center. "We had never experienced that before. People just aren't wanting to work." Bradley said it appears, in certain cases, some people would rather collect unemployment benefits than work.
"They think if they can make as much money on unemployment, so why should I work?" Bradley said. "It can be easier staying on unemployment. They establish a lifestyle."In addition to not finding as many hourly employees as he would like, Bradley said it has been a problem finding enough qualified candidates for management positions.
With people not working, it's not just a problem for small businesses, Bradley said. The entire economy can suffer as people aren't spending money at restaurants and aren't buying items such as gas. Not everyone who is out of work is counted in the unemployment figures, said Greg Rivara, a spokesman for the Department of Employment Security. To be counted, a person must continue to look for work, he said.
"Unemployment was never intended to be permanent," Rivara said. "It was intended to be a bridge. Unemployment was never set up so that a person is forced to take the first available job." Having time to search for a job can help in the long term match a person's skill sets to help with wage standards and increase productivity, Rivara said.
The maximum amount of time a person can continue to collect unemployment benefits is 99 weeks, or nearly two years, Rivara said. The department can check to see if those collecting benefits remain certified to do so, and cheating the system is not advisable, Rivara said. Those found to be cheating the system are ineligible to collect benefits again until they find a job, Rivara said.
"In this economy, that would be a tough risk to take," Rivara said. Until the market bounces back, people can continue to use this time to seek additional training, said Ron Payne, a labor market analyst with the Department of Employment Security. Places such as the Illinois WorkNet Center at 757 W. Pershing Road offer the resources to help, Payne said. "Go over to these offices and check out these services," he said.
Payne said the unemployment rate continues to be high, even as it shows signs of stabilization. The Decatur area lost 2,700 jobs over the year, as manufacturing continued to take the heaviest hit, with 1,300 positions lost, Payne said. "Until we see some progress in the manufacturing numbers on a national basis, we can't look for a whole lot until that happens," Payne said. "We're likely to see ups and downs as we come out of this."
Payne is optimistic that more of an uptick has been occurring since the February data was collected. Upcoming totals could contain gains in outdoor work as construction and lawn care pick up, he said. The financial activities sector increased by 100 positions in February, while other sectors slipped.
Decatur isn't the only Illinois city to feel the effects of the recession. All 12 metro areas in the state have increased in unemployment for 33 consecutive months.Decatur is above both the Illinois and national not seasonally adjusted unemployment rates. The rate was 12 percent in the state and 10.4 percent for the nation. Rockford was the highest at 18.6 percent, followed by Kankakee-Bradley at 16.1 percent and Danville at 15.1 percent. Those areas rely heavily on manufacturing, which Payne said are the areas that have been hit the hardest.
clusvardi@herald-review.com
421-7972
Feb. 2010 Feb. 2009
Christian County 12.6 percent 9.7 percent
Coles County 11.4 percent 8.8 percent
DeWitt County 12.0 percent 8.6 percent
Douglas County 12.0 percent 9.0 percent
Effingham County 11.6 percent 8.4 percent
Fayette County 15.6 percent 11.5 percent
Logan County 12.2 percent 9.3 percent
Macon County 14.6 percent 10.1 percent
Moultrie County 11.3 percent 8.3 percent
Piatt County 11.4 percent 7.7 percent
Shelby County 13.6 percent 10.0 percent
Posted: Friday, April 2, 2010 12:01 am
DECATUR - As the Decatur-area unemployment rate continues to increase, one local business owner questioned just how serious people are about finding jobs.
In more than 34 years working for Dairy Queen, local franchise owner Wendell Bradley said he has never had as many problems hiring staff as he does now. The problems come, even as the Decatur unemployment rate in February rose to 14.6 percent, a 4.5 percentage point increase from last year, according to Illinois Department of Employment Security statistics released Thursday.
The February rate was the highest since 1983, when it was 19 percent. In January, it was 14.4 percent.
"We are struggling to find staff, and I know that just sounds absurd," Bradley said Wednesday during a state jobs task force meeting at the Decatur Civic Center. "We had never experienced that before. People just aren't wanting to work." Bradley said it appears, in certain cases, some people would rather collect unemployment benefits than work.
"They think if they can make as much money on unemployment, so why should I work?" Bradley said. "It can be easier staying on unemployment. They establish a lifestyle."In addition to not finding as many hourly employees as he would like, Bradley said it has been a problem finding enough qualified candidates for management positions.
With people not working, it's not just a problem for small businesses, Bradley said. The entire economy can suffer as people aren't spending money at restaurants and aren't buying items such as gas. Not everyone who is out of work is counted in the unemployment figures, said Greg Rivara, a spokesman for the Department of Employment Security. To be counted, a person must continue to look for work, he said.
"Unemployment was never intended to be permanent," Rivara said. "It was intended to be a bridge. Unemployment was never set up so that a person is forced to take the first available job." Having time to search for a job can help in the long term match a person's skill sets to help with wage standards and increase productivity, Rivara said.
The maximum amount of time a person can continue to collect unemployment benefits is 99 weeks, or nearly two years, Rivara said. The department can check to see if those collecting benefits remain certified to do so, and cheating the system is not advisable, Rivara said. Those found to be cheating the system are ineligible to collect benefits again until they find a job, Rivara said.
"In this economy, that would be a tough risk to take," Rivara said. Until the market bounces back, people can continue to use this time to seek additional training, said Ron Payne, a labor market analyst with the Department of Employment Security. Places such as the Illinois WorkNet Center at 757 W. Pershing Road offer the resources to help, Payne said. "Go over to these offices and check out these services," he said.
Payne said the unemployment rate continues to be high, even as it shows signs of stabilization. The Decatur area lost 2,700 jobs over the year, as manufacturing continued to take the heaviest hit, with 1,300 positions lost, Payne said. "Until we see some progress in the manufacturing numbers on a national basis, we can't look for a whole lot until that happens," Payne said. "We're likely to see ups and downs as we come out of this."
Payne is optimistic that more of an uptick has been occurring since the February data was collected. Upcoming totals could contain gains in outdoor work as construction and lawn care pick up, he said. The financial activities sector increased by 100 positions in February, while other sectors slipped.
Decatur isn't the only Illinois city to feel the effects of the recession. All 12 metro areas in the state have increased in unemployment for 33 consecutive months.Decatur is above both the Illinois and national not seasonally adjusted unemployment rates. The rate was 12 percent in the state and 10.4 percent for the nation. Rockford was the highest at 18.6 percent, followed by Kankakee-Bradley at 16.1 percent and Danville at 15.1 percent. Those areas rely heavily on manufacturing, which Payne said are the areas that have been hit the hardest.
clusvardi@herald-review.com
421-7972
Feb. 2010 Feb. 2009
Christian County 12.6 percent 9.7 percent
Coles County 11.4 percent 8.8 percent
DeWitt County 12.0 percent 8.6 percent
Douglas County 12.0 percent 9.0 percent
Effingham County 11.6 percent 8.4 percent
Fayette County 15.6 percent 11.5 percent
Logan County 12.2 percent 9.3 percent
Macon County 14.6 percent 10.1 percent
Moultrie County 11.3 percent 8.3 percent
Piatt County 11.4 percent 7.7 percent
Shelby County 13.6 percent 10.0 percent
Broadway Bank gives $20 million in loans to felons, when Alexi Giannoulias was senior loan officer
By David Jackson, John Chase and Ray Gibson,
Tribune Reporters
9:58 p.m. CDT, April 1, 2010
The family bank of Democratic Senate candidate Alexi Giannoulias loaned a pair of Chicago crime figures about $20 million during a 14-month period when Giannoulias was a senior loan officer, according to a Tribune examination that provides new details about the bank's relationship with the convicted felons.
Broadway Bank had already lent millions to Michael Giorango when he and a new business partner, Demitri Stavropoulos, came to the bank in mid-2004. Although both men were preparing to serve federal prison terms, the bank embarked on a series of loans to them.
Alexi Giannoulias took a senior position at the bank at about the same time and used it as a launching pad for his political career. But as he campaigns to step up from state treasurer to the U.S. Senate, he has tried to distance himself from the bank's business with the pair and has been reluctant to detail his role.
Broadway is now suing to recover millions of the pair's delinquent loans as the bank struggles to avoid a federal takeover. While Broadway lawyers now criticize Giorango's business practices, the newspaper's examination of court files, land records and public bank documents raises questions about the bank's decisions to make loans to men with criminal histories.
"Banks are not supposed to be doing business with criminals," said banking consultant and former Texas Banking Commissioner Catherine Ghiglieri. "The onus is on the bank to make sure they know who they are dealing with."
Public records do not show which bank officials negotiated or approved any of the loans. Giannoulias declined to be interviewed by the Tribune or to review public records outlining the bank's loans. In a written statement from his campaign, Giannoulias said he did not play a central role in the loans. "In retrospect, I think the added security of a background check would have been good, and I believe that many more banks — including Broadway — now include such checks as part of the loan-making process," he added.
Stavropoulos in 2005 began a two-year sentence following a felony conviction for running a multistate bookmaking ring, while Giorango would serve six months intermittent confinement on a felony for promoting a nationwide prostitution scheme as Broadway financed their land deals from downtown Chicago to Florida, California and South Carolina.
In the most complete examination yet of Broadway's loans to the pair, the Tribune found more than $27 million worth of mortgages to Giorango and his land trusts and companies since 1999. Stavropoulos took part in many of those deals. Broadway officials have cited privacy laws in declining to document the full extent of their business with the men. The new figures exceed reported totals by about $7 million.
Shortly after Broadway began lending money to a Chicago firm the pair formed, Giorango and Stavropoulos used that company to launch their own lending business and make more than 40 short-term loans to borrowers who might not qualify for traditional bank financing, the Tribune found. Such so-called hard-money loans are typically riskier than long-term mortgages offered by banks.
Broadway officials say they were unaware of the pair's lending operation and believe the bank's loans were used solely to fund real estate purchases. They acknowledged they did not inspect or audit the company's business records, though Broadway's loan provisions allowed the bank to do so.
In a two-hour interview this week with the Tribune, Giannoulias' older brother, Demetris Giannoulias, the bank's president and CEO, said he established Broadway's relationship with Giorango in the mid-1990s. Giorango began investing in Chicago properties after completing two federal prison stints for running bookmaking schemes.
Demetris Giannoulias described Giorango as an account holder who at first used relatively small loans for real estate ventures that proved successful. As those ventures grew more ambitious, Broadway advanced more than $6 million to Giorango or his land trusts and companies between 1999 and mid-2004, land records show.
In part because those loans "performed," Demetris Giannoulias said, the bank felt comfortable launching the spate of new financing beginning in mid-2004. Alexi Giannoulias, who started his professional career at the bank in 2002, said in his statement that he was "one of" the senior loan officers at the bank and was not a member of the loan committee that approved the financing for Giorango.
Alexi Giannoulias' role was limited to "getting the appraisals ordered, getting the loan documents prepared, coordinating with attorneys, getting commitment letters prepared. All that kind of stuff," Demetris Giannoulias said. Demetris Giannoulias said the bank learned of Giorango's bookmaking and prostitution promotion convictions from a spring 2004 Tribune report detailing those cases.
"But we're a relationship bank," he said. "So somebody comes in and in all his dealings with the bank seem to be on the level, everything makes sense, nothing seems illicit or untoward. Just because somebody gets a bad article written about them there's no reason to say, ‘Hey, listen, I'm going to kick you out the door because you don't win a popularity contest.' We didn't think he was doing anything illegal."
He said he asked Giorango about the convictions and Giorango said, "It's in the past. I don't do that anymore." At least one of the Broadway mortgages signed by Giorango — a September 2005 loan for $3.4 million used to buy a 32-unit Los Angeles apartment complex — specifies that the borrower "has not been convicted of a felony."
Stavropoulos recently worked as the $5,000-a-week consultant to a Bridgeview strip club, according to his testimony in a September 2009 civil court deposition, and operated a real estate firm that listed properties of reputed Chicago Outfit figure Michael Sarno. Stavropoulos and Giorango both declined to comment.
The firm the pair founded that made hard-money loans, 1201 South Western LLC, is embroiled in lawsuits involving delinquent loans. Broadway ultimately foreclosed on mortgage loans it made to the company and took control of its property at 1201 S. Western Ave. on the city's West Side.
Demetris Giannoulias told the Tribune the bank had no reason to believe that Broadway loans to the 1201 business were used for a hard-money operation. "Generally speaking, we did not give any loans to finance lending operations to any clients," Demetris Giannoulias said. But he added that the bank did not inspect or audit the pair's business records.
"There's no reason to believe there was anything going on but the acquisition of the real estate," he said of the Broadway loans. Broadway violated no laws if it didn't know that Giorango and Stavropoulos were using Broadway funds to lend money, said Robert Serino, a former director of the Comptroller of the Currency's enforcement and compliance division. But Serino added that if the Giannoulias family "put their head in the sand and didn't want to know, they wouldn't necessarily be violating the statute, but they may not be doing their jobs."
The 1201 firm was formed in August 2004 and that month paid $850,000 for a nondescript West Side commercial building. Broadway loaned the 1201 firm $680,000 to complete that sale. That building was then bundled with other properties as collateral to secure millions of dollars in additional Broadway loans to the 1201 firm.It is not possible to determine from public records whether money from Broadway mortgages was poured into the pair's hard-money operation. Take for example what appears to be Broadway's first deal with Giorango and Stavropoulos.
In July 2004, records show, Broadway gave Giorango and Stavropoulos a $1.1 million loan, and they used that money to pay $1.5 million for an office building at 88th Street and Ashland Avenue. But the South Side businessman who owned the property at the time told the Tribune he was not selling the building to Giorango and Stavropoulos but rather was using it as collateral to borrow money from them.
"He (Giorango) loaned me the money, and I paid him off," said Gene Linton, who ran a company called the Economic Development Center that owned the property. Broadway got back its investment when Linton sold the building six months later.
In addition to the 1201 S. Western building foreclosure, Broadway lawyers since last year have filed six separate foreclosure lawsuits as well as bankruptcy court pleadings to recover roughly $15 million from delinquent mortgages to Giorango and Stavropoulos ventures. Five of those cases were resolved when the bank took or sold properties, but two cases over loans totaling $7 million are pending, records and interviews show.
Today Broadway lawyers harshly criticize Giorango's business skills and practices, saying in a recent legal brief that he didn't pay taxes or keep proper business records on a Miami Beach hotel used as collateral for multiple Broadway loans totaling more than $10 million. The bank attorneys alleged in court papers that Giorango "severely mismanaged" that hotel and failed to make repairs or address code violations.
The bank's ongoing problems have become a major campaign issue for Alexi Giannoulias as he runs against Republican opponent U.S. Rep. Mark Kirk. Giannoulias last month said he fears Broadway, which is struggling to raise more than $85 million to prevent a federal takeover, will fail.
dyjackson@tribune.com
jchase@tribune.com
rgibson@tribune.com
http://www.chicagotribune.com/news/elections/ct-met-giannoulias-bank-loans-20100401,0,1521213,full.story
Tribune Reporters
9:58 p.m. CDT, April 1, 2010
The family bank of Democratic Senate candidate Alexi Giannoulias loaned a pair of Chicago crime figures about $20 million during a 14-month period when Giannoulias was a senior loan officer, according to a Tribune examination that provides new details about the bank's relationship with the convicted felons.
Broadway Bank had already lent millions to Michael Giorango when he and a new business partner, Demitri Stavropoulos, came to the bank in mid-2004. Although both men were preparing to serve federal prison terms, the bank embarked on a series of loans to them.
Alexi Giannoulias took a senior position at the bank at about the same time and used it as a launching pad for his political career. But as he campaigns to step up from state treasurer to the U.S. Senate, he has tried to distance himself from the bank's business with the pair and has been reluctant to detail his role.
Broadway is now suing to recover millions of the pair's delinquent loans as the bank struggles to avoid a federal takeover. While Broadway lawyers now criticize Giorango's business practices, the newspaper's examination of court files, land records and public bank documents raises questions about the bank's decisions to make loans to men with criminal histories.
"Banks are not supposed to be doing business with criminals," said banking consultant and former Texas Banking Commissioner Catherine Ghiglieri. "The onus is on the bank to make sure they know who they are dealing with."
Public records do not show which bank officials negotiated or approved any of the loans. Giannoulias declined to be interviewed by the Tribune or to review public records outlining the bank's loans. In a written statement from his campaign, Giannoulias said he did not play a central role in the loans. "In retrospect, I think the added security of a background check would have been good, and I believe that many more banks — including Broadway — now include such checks as part of the loan-making process," he added.
Stavropoulos in 2005 began a two-year sentence following a felony conviction for running a multistate bookmaking ring, while Giorango would serve six months intermittent confinement on a felony for promoting a nationwide prostitution scheme as Broadway financed their land deals from downtown Chicago to Florida, California and South Carolina.
In the most complete examination yet of Broadway's loans to the pair, the Tribune found more than $27 million worth of mortgages to Giorango and his land trusts and companies since 1999. Stavropoulos took part in many of those deals. Broadway officials have cited privacy laws in declining to document the full extent of their business with the men. The new figures exceed reported totals by about $7 million.
Shortly after Broadway began lending money to a Chicago firm the pair formed, Giorango and Stavropoulos used that company to launch their own lending business and make more than 40 short-term loans to borrowers who might not qualify for traditional bank financing, the Tribune found. Such so-called hard-money loans are typically riskier than long-term mortgages offered by banks.
Broadway officials say they were unaware of the pair's lending operation and believe the bank's loans were used solely to fund real estate purchases. They acknowledged they did not inspect or audit the company's business records, though Broadway's loan provisions allowed the bank to do so.
In a two-hour interview this week with the Tribune, Giannoulias' older brother, Demetris Giannoulias, the bank's president and CEO, said he established Broadway's relationship with Giorango in the mid-1990s. Giorango began investing in Chicago properties after completing two federal prison stints for running bookmaking schemes.
Demetris Giannoulias described Giorango as an account holder who at first used relatively small loans for real estate ventures that proved successful. As those ventures grew more ambitious, Broadway advanced more than $6 million to Giorango or his land trusts and companies between 1999 and mid-2004, land records show.
In part because those loans "performed," Demetris Giannoulias said, the bank felt comfortable launching the spate of new financing beginning in mid-2004. Alexi Giannoulias, who started his professional career at the bank in 2002, said in his statement that he was "one of" the senior loan officers at the bank and was not a member of the loan committee that approved the financing for Giorango.
Alexi Giannoulias' role was limited to "getting the appraisals ordered, getting the loan documents prepared, coordinating with attorneys, getting commitment letters prepared. All that kind of stuff," Demetris Giannoulias said. Demetris Giannoulias said the bank learned of Giorango's bookmaking and prostitution promotion convictions from a spring 2004 Tribune report detailing those cases.
"But we're a relationship bank," he said. "So somebody comes in and in all his dealings with the bank seem to be on the level, everything makes sense, nothing seems illicit or untoward. Just because somebody gets a bad article written about them there's no reason to say, ‘Hey, listen, I'm going to kick you out the door because you don't win a popularity contest.' We didn't think he was doing anything illegal."
He said he asked Giorango about the convictions and Giorango said, "It's in the past. I don't do that anymore." At least one of the Broadway mortgages signed by Giorango — a September 2005 loan for $3.4 million used to buy a 32-unit Los Angeles apartment complex — specifies that the borrower "has not been convicted of a felony."
Stavropoulos recently worked as the $5,000-a-week consultant to a Bridgeview strip club, according to his testimony in a September 2009 civil court deposition, and operated a real estate firm that listed properties of reputed Chicago Outfit figure Michael Sarno. Stavropoulos and Giorango both declined to comment.
The firm the pair founded that made hard-money loans, 1201 South Western LLC, is embroiled in lawsuits involving delinquent loans. Broadway ultimately foreclosed on mortgage loans it made to the company and took control of its property at 1201 S. Western Ave. on the city's West Side.
Demetris Giannoulias told the Tribune the bank had no reason to believe that Broadway loans to the 1201 business were used for a hard-money operation. "Generally speaking, we did not give any loans to finance lending operations to any clients," Demetris Giannoulias said. But he added that the bank did not inspect or audit the pair's business records.
"There's no reason to believe there was anything going on but the acquisition of the real estate," he said of the Broadway loans. Broadway violated no laws if it didn't know that Giorango and Stavropoulos were using Broadway funds to lend money, said Robert Serino, a former director of the Comptroller of the Currency's enforcement and compliance division. But Serino added that if the Giannoulias family "put their head in the sand and didn't want to know, they wouldn't necessarily be violating the statute, but they may not be doing their jobs."
The 1201 firm was formed in August 2004 and that month paid $850,000 for a nondescript West Side commercial building. Broadway loaned the 1201 firm $680,000 to complete that sale. That building was then bundled with other properties as collateral to secure millions of dollars in additional Broadway loans to the 1201 firm.It is not possible to determine from public records whether money from Broadway mortgages was poured into the pair's hard-money operation. Take for example what appears to be Broadway's first deal with Giorango and Stavropoulos.
In July 2004, records show, Broadway gave Giorango and Stavropoulos a $1.1 million loan, and they used that money to pay $1.5 million for an office building at 88th Street and Ashland Avenue. But the South Side businessman who owned the property at the time told the Tribune he was not selling the building to Giorango and Stavropoulos but rather was using it as collateral to borrow money from them.
"He (Giorango) loaned me the money, and I paid him off," said Gene Linton, who ran a company called the Economic Development Center that owned the property. Broadway got back its investment when Linton sold the building six months later.
In addition to the 1201 S. Western building foreclosure, Broadway lawyers since last year have filed six separate foreclosure lawsuits as well as bankruptcy court pleadings to recover roughly $15 million from delinquent mortgages to Giorango and Stavropoulos ventures. Five of those cases were resolved when the bank took or sold properties, but two cases over loans totaling $7 million are pending, records and interviews show.
Today Broadway lawyers harshly criticize Giorango's business skills and practices, saying in a recent legal brief that he didn't pay taxes or keep proper business records on a Miami Beach hotel used as collateral for multiple Broadway loans totaling more than $10 million. The bank attorneys alleged in court papers that Giorango "severely mismanaged" that hotel and failed to make repairs or address code violations.
The bank's ongoing problems have become a major campaign issue for Alexi Giannoulias as he runs against Republican opponent U.S. Rep. Mark Kirk. Giannoulias last month said he fears Broadway, which is struggling to raise more than $85 million to prevent a federal takeover, will fail.
dyjackson@tribune.com
jchase@tribune.com
rgibson@tribune.com
http://www.chicagotribune.com/news/elections/ct-met-giannoulias-bank-loans-20100401,0,1521213,full.story
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