Corruption imposes ‘tax’ on Illinois
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| Former Gov. George Ryan, accompanied by his son George H. Ryan Jr., (right) leaves Chicago's federal courthouse April 17, 2006, after being convicted of racketeering and fraud charges. As Illinois taxpayers look down the barrel of a major income tax increase, another tax is already draining their wallets. It's the "corruption tax" – the extra money that Illinois residents end up paying because of dishonest public officials. (AP file photo) |
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SPRINGFIELD – As taxpayers look down the barrel of a major income tax increase, another tax already is draining their wallets. But this one isn’t found anywhere in the tax code.
It’s the “corruption tax” – the extra money Illinois residents pay because of dishonest public officials.
People pay the tax when politicians give government jobs to unqualified cronies and contracts to expense-padding donors. They pay when public employees take bribes to overlook violations, when law enforcement spends millions prosecuting crooked politicians and when people are injured because of government misconduct.
“It means hundreds of millions of dollars lost in waste,” said Dick Simpson, a former Chicago alderman and head of political science at the University of Illinois in Chicago.
Every state has its share of bad apples, but Illinois is notoriously corrupt. Residents and politicians sometimes seem to embrace the state’s “anything goes” culture.
All together, 1,000 public officials and businessmen have been convicted of public corruption in Illinois since 1970, Simpson found. That includes 19 Cook County judges, 30 Chicago aldermen, two members of Congress and two governors – plus another imprisoned for crimes unrelated to state government.
Then there’s Gov. Rod Blagojevich, who was arrested in December on charges of trying to squeeze money out of candidates seeking an open U.S. senate seat. His arrest seemed ramp up anger over public corruption.
It’s impossible to calculate the full cost of the corruption tax. Simpson has come up with a $300 million estimate, but that focuses on the Chicago area and doesn’t directly apply to taxpayers downstate.
Still, experts point to many ways corrupt government is more expensive than honest government.
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Shoddy work
Someone put in a government job because he knows the right people isn’t likely to work hard for his paycheck. In extreme cases, he might not show up for work at all, instead becoming what’s known as a ghost payroller. One Cicero “health inspector” got $133,000 in salary and benefits for a job he never performed. He also got a one-year prison sentence.
Likewise, a company awarded a city contract through bribery isn’t going to worry about performance; a lousy job won’t jeopardize contract renewal.
Just look at Chicago’s “Hired Truck” program, where the city outsourced hauling jobs to private firms. Many companies, some with Mob connections, paid bribes to get contracts then collected taxpayer money while doing little or no work. A federal investigation has resulted dozens of corruption convictions.
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Unnecessary expenses
When corrupt officials want to create work for political allies, they sometimes fill jobs that don’t need to be filled or produce unnecessary “consulting” contracts.
Just after Blagojevich became governor, the state suddenly started paying a company more than $500,000 to wash buildings, bridges and even road salt storage domes. Yet the work could have been done by state employees. The firm’s president turned out to be the brother-in-law of a high-ranking Transportation Department official, who eventually resigned after the contract was suspended.
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Law enforcement
It costs money to catch a crook.
FBI agents and U.S. attorneys can spend years — and multiple criminal trials — working their way up the corruption ladder to someone like Gov. George Ryan. First come the footsoldiers, then middle management, then high-ranking advisers and finally the top guy.
Investigations of Ryan, for instance, stretch back to 1993. The federal probe kicked into high gear in 1998, and Ryan was convicted in 2006. He’s now serving 6½ years in prison.
Officials could not estimate the total cost of Ryan’s case, but it’s clear their time and money could have been spent going after the mob or drug dealers or crooked businessmen.
“Every time we have a federal prosecution, that’s a cost,” said Cindi Canary, executive director of the Illinois Campaign for Political Reform.
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Outright theft
Corruption doesn’t always involve shady contracts and political scheming. Some people just steal.
The former manager of an East St. Louis federal housing agency was convicted in 2006 for embezzling nearly $158,000. She spent most of the money on gambling. And an employee in the state treasurer’s office was convicted of stealing at least $263,000 from taxpayers by opening a bank account under a false name and depositing state money in it.
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Lost business
Businesses weigh many factors when deciding where to locate or expand operations, including tax breaks and regulatory policies. They also look at the political climate. Businesses concerned they won’t get their fair share of government services without paying bribes, or who think backroom deals dictate government policy, may very well decide Illinois isn’t for them.
“Businesses fear getting dragged into something that will get bad press or get involved in a federal or state investigation. That’s huge,” said George Ranney, president and CEO of Chicago Metropolis 2020. “If there’s a real cloud, it’s probably as important as tax breaks.”
More businesses mean more jobs, and more money flowing into the state treasury to help take some of the burden off struggling families.
Corruption also can be a factor for smaller Illinois companies or entrepreneurs who hope to get businesses off the ground but hesitate to seek government contracts because they haven’t donated to the right politician or greased the right palm.
Taxpayers, in turn, miss out on competition for state work and businesses that could create jobs and pay taxes are weakened.
The belief that government doors are closed to most people, whether ambitious entrepreneurs or just average taxpayers, hurts everyone, says Sen. Dan Cronin, R-Elmhurst.
“People become hardened, they withdraw from the system, they don’t follow what’s going on,” Cronin said. “Then what happens? It only gets worse because nobody’s watching.”
