Illinois Lost 1 Resident Every 4.3 Minutes In 2017, Dropped To 6th Most Populous State

Illinois is drowning under a mountain of debt, unpaid bills and underfunded pension liabilities and it"s largest city, Chicago, is suffering from a staggering outbreak of violent crime not seen since gang wars engulfed major cities from LA to New York in the mid-90"s.  Here is just a small taste of some of our posts on Illinois" challenges:

• Illinois Pension Funding Ratio Sinks To 37.6% As Unfunded Liabilities Surge To $130 Billion


• Illinois Unpaid Vendor Backlog Hits A New Record At Over $16 Billion


• The State Of Illinois Is "Past The Point Of No Return"


• "What The Hell Is Going On In Chicago" And Other Highlights From Trump"s Speech To FBI Grads

Given that, it"s hardly surprising that the Prairie State lost a net 33,700 residents in fiscal year 2017, according to the Census Bureau.  Also not surprising is the fact that the mass exodus from Illinois was the largest of any state in the country with lower taxed, lower cost of living states like Texas and Florida posting the biggest gains. 

Of course, the net population loss masks the true gross outflow of Illinois residents as it doesn"t account for natural births/deaths. Assuming that Illinois has the same natural population growth as the U.S. as a whole (0.7%) implies that the state lost a staggering ~125,000 residents in aggregate, or roughly 1 man/woman/child every 4.3 minutes.

Meanwhile, adding insult to injury, the domestic migration out of Illinois was enough to push the state down one notch on the state population ranking tables to just below Pennsylvania. Per Illinois Policy:

Of course, this is all terrible news for Illinois retirees whose pension obligations continue to grow every year and currently stand at nearly $130 billion...

While we could be wrong, the last we checked folks were no longer on the hook to pay Illinois taxes after making the decision to move to another state.  Meanwhile, efforts to offset the lost tax revenue will only result in an acceleration of population declines in the future...

Conclusion: Sorry, Illinois, but your ponzi scheme is slowly coming unraveled.

Sears Crashes After Second Largest Shareholder Resigns From Board

With Toys "R" Us having already filed Chapter 11 bankruptcy, in a move that came as a shock to most of its bondholders, suddenly the race between Bon-Ton Stores and Sears Holdings who will file next, is entering its last lap.

For those who may have missed it, late last week, in a scenario right out of the last days of Toys "R" Us, some of Bon-Ton Stores’s suppliers reportedly scaled back shipments and asked to be paid sooner in order to protect themselves from potential losses in case the department-store chain unexpectedly filed for bankruptcy, Bloomberg reported on Friday.

The suppliers have insisted on getting paid with letters of credit or cash on delivery, which can be a drain on the company’s resources, said the people, who asked not to be named because the matter is private. The demands come just as the chain enters the key holiday-shopping season in the U.S. “We maintain constructive relationships with our vendors,” Christine Hojnacki, a spokeswoman for the York, Pennsylvania-based company, said in a statement. “Our team has been working closely with all of our vendors, large and small, as we build inventory ahead of the holiday season.”

Unlike Toys, however, Bon-Ton"s inevitable default has already been largely priced in, and the news of the supplier strike had a modest impact on Bon-Ton’s $350 million of 8% second-lien bonds due 2021 which dropped "ony" 2.5 cents to trade at 32.6 cents on the dollar Friday.

Bon-Ton, which operates 260 stores across 24 states, had hired PJT Partners and AlixPartners over the summer to explore options for dealing with its more than $1 billion debt load. In September, it announced an $18.9 million sale-and-leaseback transaction for a store in Roseville, Minnesota, that will boost liquidity in the short-term and buy breathing room.

And while Bon-Ton"s fate now appears sealed, the question is whether or not that other perrenial bankruptcy candidate, Sears Holdings, will get to bankruptcy court first.

The reason, and why Sears stock crashed 12%, on track for its close in 8 months is that on Monday the struggling department store chain said that Bruce Berkowitz, CIO of of Fairholme Capital Management LLC and the company"s second largest shareholder after Eddie Lampert, was stepping down from its board of directors at the end of the month. Fairholme Capital controlled 28.9 million Sears shares as of June 30, making it second-largest shareholder with just shy of 27% of the shares outstanding.

With today"s collapse, the stock has erased all gains it made since it announced a $1 billion restructuring in early February, and has plunged 26% over the past three months. A Sears bankruptcy would be catastrophic for the US mall sector, and as such we expect the "big short" trade, the CMBX 6 BBB- tranche to blow out sharply on the news of Berkowitz" resignation.

Chicago Population Shrinks Most Of Any City In US

Authored by Mike Shedlock via MishTalk.com,

Illinoisans continue their exodus, with Chicago having the dubious distinction of the highest population loss in the nation.

High taxes are the number one reason people and businesses leave the state.

What follows is a guest post by Michael Lucci, Vice President of Policy, Illinois Policy Institute.

CHICAGO ONLY MAJOR U.S. CITY TO LOSE POPULATION FROM 2015 TO 2016

The majority of major cities in Illinois are shrinking as the Land of Lincoln depopulates due to massive out-migration to other states.

But while most of Illinois’ cities and towns are continuing to shrink, the majority of cities and towns in Illinois’ bordering states are growing, according to data from the U.S. Census Bureau.
When Illinoisans are polled on why they are leaving, taxes are the No. 1 reason they cite. Yet Illinois politicians continue to raise taxes, showing that political leaders have not yet heard the message of the state’s residents.

Chicago shrank more than any other U.S. city, but Berwyn, Cicero and Peoria are shrinking faster on a per capita basis

Chicago’s population declined by 8,638 people from July 2015 to July 2016, a larger loss than any other major American city. Illinois has 29 cities with 50,000 people or more, and 21 of those cities also shrank in total size.

However, on a per capita basis, Decatur is shrinking more than any other city in Illinois. Decatur’s population shrank by 8.5 people per 1,000 residents from July 2015 to July 2016. That means that for every 1,000 people in Decatur in 2015, there were 8.5 fewer people in Decatur in 2016.

On a per capita basis, Decatur’s loss was followed by Berwyn, Cicero, Peoria and Oak Park, all of which shrank by more than seven people per 1,000 residents.

Eight of these larger Illinois cities had population growth year over year. Champaign is the only Illinois city that had more than 1 percent population growth, fueled almost entirely by the arrival of international students at the University of Illinois.

Most of these cities are shrinking because there are so many people leaving for other parts of the country. Those losses to other parts of the country outweigh the normal population gains experienced across the state from having more births than deaths, and having a small inflow of international immigrants.

Illinois’ Neighbors are Watching Most of their Biggest Cities Grow

The story is different in neighboring states, where most cities with more than 50,000 people are growing. Illinois’ border states have 58 cities with more than 50,000 people, and 38 of them are growing. That means that 65 percent of such cities in neighboring states are growing.

In Illinois, only eight of 29 cities with populations of 50,000 or more are growing, which is only 28 percent of Illinois cities with more than 50,000 people.

A large part of the reason Illinois’ border states have growing cities and Illinois has shrinking cities is because Illinois is losing the border wars with all of its neighbors. Illinoisans are flooding into bordering states faster than ever before. Over the last 10 years, Illinois has experienced large net migration losses to nearly all of its bordering states, and those losses have accelerated in recent years. (The exception to this 10-year trend is Michigan, which shares a lake border with Illinois and to which Illinois had net losses of residents over only the two most recent years of data.)

Higher Taxes Will Push More Residents Out of State

The Census Bureau released its out-migration data the same week the Illinois Senate passed a massive tax hike bill.

This is a significant development in a state where residents are fed up with the high tax burden, and this frustration is pushing more and more people to leave. According to a Paul Simon Public Policy Institute poll released in October 2016, 47 percent of Illinoisans surveyed said they want to leave the state. And taxes were the most commonly cited reason people gave for their desire to move.

And according to a recent poll commissioned by the Illinois Policy Institute, fewer than 1 in 3 likely Illinois voters support raising taxes to balance the state’s books. Yet the General Assembly continues to insist on tax hikes as the way to close the budget deficit.

Illinoisans are taxed enough already, and the state will continue to lose residents until it reins in taxes and adopts policies to support more jobs growth.

The General Assembly has run a losing strategy for years: raising taxes and failing to reform spending drivers. This has not brought prosperity or opportunity to the state, and will not do so over the longer term, either.
Illinois will not become sustainable again until the state implements reforms so that the government, its bureaucracies and special interests serve the people rather than the other way around.

Until Illinois is fixed, Illinoisans will continue to vote with their feet against staying in the Land of Lincoln.

Michael Lucci
Vice President of Policy

* *  *

Those who leave are generally better educated and have higher wages than those who stay. Those who cannot find another job elsewhere have no choice but to stay.

Five Desperately Needed Reforms

1. Municipal bankruptcy legislation


2. Pension reform


3. Right-to-Work legislation


4. End of prevailing wage laws


5. Workers’ compensation reform

Number one on my list of Illinois reforms is bankruptcy legislation. It is the only hope for numerous Illinois cities whose hands are also tied by union-sponsored prevailing wage laws.

For further discussion, including pension analysis,  please see Puerto Rico Placed in Bankruptcy Protection: Illinois Needs Similar Deal.

Cook County Illinois Suffers Largest Population Drop In Entire US

Authored by Mike Shedlock via MishTalk.com,

Illinois voters are voting with their feet. Not only are people scrambling to get out of Cook County, but the entire state is suffering.

Illinois Policy Institute writer Michael Lucci explains in this guest post on Cook County Migration.

Cook County has Largest Population Loss of Any County in U.S.

Cook County lost more population than any other county in the United States from July 2015 to July 2016, according to a new data release from the U.S. Census Bureau.

Cook County shrank by 21,324 people. The county had more births than deaths and gained 18,434 people from international immigration. However, Cook County had a net loss of 66,244 people to other parts of the United States, which more than offset the components of population growth.

However, the people leaving Cook County aren’t showing up in other parts of Illinois when the net movements of people are considered.

In fact, most of Illinois is depopulating – 93 of Illinois’ 102 counties are experiencing net out-migration, and 89 of Illinois’ 102 counties have shrinking populations. Illinois’ dysfunctional government, weak job creation, and ever-increasing tax burden help explain why. A Paul Simon Public Policy Institute poll released in October 2016 found that taxes were the No. 1 reason people want to leave Illinois.

Cook, DuPage, Lake, Kane, McHenry, Will counties see net out-migration to other parts of the U.S.

The major driver of Cook County’s shrinking population is that the county’s domestic migration losses have doubled over the last five years, while international gains have remained flat and gains from more births than deaths have declined.

The flow of people out of Cook County did not result in net in-migration for the collar counties. Cook County’s net out-migration of 66,244 people was followed by net out-migration of 9,171 people from DuPage; 5,179 from Lake; 1,824 from Kane; 1,589 from McHenry; and 1,253 from Will. Kendall County is the nearest to Cook to have net inflows, with Kendall gaining 553 more people than it lost to other parts of the country.

The out-migration from Cook, DuPage, Lake and McHenry counties was large enough to make all those counties shrink in total population. Kane County and Will County managed to have population gains despite their out-migration problems.

It should worry policymakers in Chicago and Cook County that out-migration and population loss were already so strong in the July 2015 – July 2016 timeframe. That’s because Chicago and Cook County’s major property and sales tax hikes had not yet taken effect at the time of this out-migration. When those tax hikes are in place, the Chicago area will likely lose more population due to taxation. And the economic effects of increased taxation will be felt a few years later, with fewer jobs and economic growth than would have occurred without the tax hikes. Population loss in the Chicago area is likely to get worse.

Not just the collar counties: All of Illinois is seeing population losses

The problem is not just with Cook and the collar counties: The majority of Illinois counties are shrinking. Eighty-nine of Illinois’ 102 counties are shrinking in total population. Northeast Illinois is shrinking most in terms of total population, but many downstate counties are shrinking and seeing more out-migration as a percentage of population. For example, Rock Island and Peoria counties both have more out-migration as a percentage of population than Cook County.

Most of Illinois’ metropolitan statistical areas are also shrinking due to large migration losses to other parts of the country, with only Elgin and Champaign showing slow population growth. The Chicago metro division saw a net migration loss of nearly 78,000 people, driving a population decline of more than 19,000 people for the Chicago metro division.

Elgin had net migration losses to other parts of the country. However, Elgin’s population growth is attributable to an unusually high birth rate and a solid gain of international immigrants. Champaign similarly relies on international immigration to avoid a shrinking population size. Champaign showed a large gain from international immigration, likely a flow of international students to the University of Illinois.

The U.S. Census Bureau’s report does not come as a surprise, but it should serve as a warning to state and local governments. Illinois is depopulating, and no area is immune from its effects. Downstate communities are especially stressed due to the loss of manufacturing jobs and other blue-collar industries. And the Chicago area is likely to face additional stress as nearly $2 billion dollars in tax hikes are phased in over the next few years.

Lawmakers can take on two key measures to give taxpayers hope. The first is to freeze property taxes statewide so Illinoisans can feel secure in their homes. The second is to pass a balanced budget without any tax increases to give residents confidence that lawmakers can rein in out-of-control spending and not repeatedly hit up taxpayers for more of their hard-earned dollars.

Before considering any more tax increases, policymakers statewide should consider the sobering reality of how quickly people are leaving the state.

Michael Lucci

Mish Getaway

People keep asking “When are you leaving?” Rest assured plans are in progress and have been for some time.

But some people are stuck here. Others want to be here for personal reasons even though they are fed up with the state of affairs.

IPI Push

1. Give Illinoisans much-needed property tax relief


2. Consolidate Illinois’ many layers of duplicative government


3. Cut burdensome regulations to attract businesses and jobs to Illinois

The Illinois Policy Institute is fighting on your behalf every day in Springfield. Please consider Making a Contribution to Illinois Policy Institute.

I am an unpaid senior fellow at the IPI and receive no part of donations. My benefit is the same as yours. The IPI is fighting on our behalf.

The Illinois Policy Institute is a 501(c)(3) charitable organization, and contributions are tax-deductible to the fullest extent allowed by law.

Few organizations work as hard as the IPI to support Illinois taxpayers.

Illinois Is Losing 1 Resident Every 4.6 Minutes

Illinois has record loss of 114,000 residents to other states in 2016 as population shrinks by 37,500.

Imagine the entire population of Peoria, Illinois’ seventh-largest city, all picking up and moving across state lines in one year, never to work, pay taxes or create jobs in Illinois again. That’s equivalent to what happened to Illinois over the past year: New migration data from the U.S. Census Bureau show that from July 2015 to July 2016, Illinois lost 114,000 people, on net, to other states, a record high for the Land of Lincoln.

Now consider the permanent loss of the combined populations of Illinois’ 10 largest cities outside of Chicago: Aurora, Rockford, Joliet, Naperville, Springfield, Elgin, Waukegan, Champaign and Arlington Heights, along with Peoria. The loss of these 10 cities’ combined populations approximately equals Illinois’ net loss of population to other states since 2000. Illinois has lost some 1.22 million people, on net, over the past 16 years.

For the third year in a row, Illinois is the only state in the region with a shrinking population.

Illinois sustained record net losses for each of the last three years of census migration data: a net loss of 114,000 people from July 2015 – July 2016; a net loss of 105,000 people from July 2014-2015; and a net loss of 95,000 people in the year before that.

From 1990-2011, the annual net loss of residents from Illinois to other states was 64,000 per year. But the 2011 income tax hikes, repeated property tax hikes and the state’s political dysfunction precipitated the record population losses of the last three years.

Illinois’ rate of exodus is now one person every 4.6 minutes. That’s a faster rate of flight than even Michigan experienced in its worst years as Detroit plunged into bankruptcy. And according to wealth flight data from the Internal Revenue Service, the net loss of one person every 4.6 minutes comes with a net loss of $30,000 of taxable income every 4.6 minutes, too.

Illinois’ population shrank by 37,500 people between July 2015 and July 2016 because the migration losses to other states overwhelmed the natural gains all states experience: more births than deaths and people immigrating to America from overseas. If there were no migration between states, every state would experience population growth every year. However, a few states lose so many people to other states that their populations shrink. Because Illinois lost so many people to other states, the Land of Lincoln’s population shrank by 37,500 people, the worst of all states. West Virginia was second worst with its population shrinking by 10,000.

Pennsylvania is also shrinking: Its population contracted by 7,700 in the most recent year of data, compared with Illinois’ shrinking by 37,500 people. However, Illinois is shrinking so much faster that Pennsylvania is poised to surpass Illinois to become the nation’s fifth most populous state as soon as next year.

At the last census in 2010, Illinois had 130,000 more people than Pennsylvania. Now, the difference stands at 17,000, an amount Pennsylvania will make up in 2017 if next year’s migration losses resemble this year’s for both states. The population gap between Illinois and Pennsylvania is closing rapidly, and Illinois will soon drop to become the sixth-largest state in the U.S.

The alarming census data should grab the attention of Illinois policy makers and shift the conversation toward transformational reforms. Out-of-control spending continues to drive up taxes, and only changes to government-worker pension systems and collective bargaining laws can rein in those costs. In addition, the state’s hostile investment and jobs climate is especially inhospitable for for blue-collar occupations such as manufacturing. Without businesses investing in Illinois, there will be no job creation for Illinois’ middle class.

Perhaps most importantly, Illinoisans need to see changes in the state’s political environment. The fact that Democratic lawmakers haven’t found a single substantive economic or political reform on which they will agree with Gov. Bruce Rauner speaks volumes about the intransigence of the state’s political class, and its refusal to work for the common good. The lawmakers who have driven the state into financial and economic peril and who have overseen a flood of out-migration are poorly suited to guide Illinois to a brighter future. Illinoisans need new leaders to address the problems the state is facing. Term limits for elected officials and a more equitable legislative map would be a powerful signal that Illinois is changing its ways.

Illinois is living through a man-made exodus. It must enact responsible spending, tax, regulatory and political reforms to show residents and job creators the state is serious about keeping its most valuable resource – its people – and welcoming businesses that can help them earn a living and stay here.