There are words, and there are deeds, the old saying goes.
Illinois Governor J.B Pritzker's budget address yesterday belongs in the “words” category.
Budgets are important, don’t get me wrong. They are the mechanism used under the Illinois Constitution to authorize and allocate billions of dollars of taxpayer dollars, every year, for the objects of affection chosen by the Illinois Legislature and Governor.
But it is important to recognize what budgets are -- and what they are not.
Budgets are prospective, forward-looking planning and authorization documents. They are not results.
Budgets get a lot of attention, perhaps too much attention. Yet when our state, local and federal governments issue their annual financial reports, they arrive to a deafening silence -- especially when compared to budgets.
Why? I’m afraid an important reason is that a lot of people, including well-organized special interest groups feasting on the public purse, care a lot more about spending than they do about accounting for that spending.
There are words, and there are deeds. And historically, Illinois citizens and taxpayers have been misled by years and years of claims to “balanced budgets,” even as Illinois accumulated massive many-billions-of-dollars-worth of unfunded debt obligations.
The wiggle room that has been crafted by the politicians and special interests that benefitted from unsustainable kick-the-can-down-the-road financing comes from how the Illinois government accounts for debt and expenses.
Accounting standards effectively allow governments to do things like count borrowing proceeds as revenue, and to deliberately underfund retirement benefits, as means for “balancing budgets.”
At Truth in Accounting, we are on a related mission to encourage the Governmental Accounting Standards Board to stop misleading and confusing accounting standards for financial statements related to budgets. You can learn more about that at our website.
You can listen to Gov. Pritzker’s full budget address here. Further analysis to follow.
But remember, there are words, and there are deeds. We are going to learn more about the deeds when Illinois issues its audited annual financial report for fiscal year 2020 in a few months, and I encourage taxpayers and citizens to pay more attention then, too.