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'I Learned From Pain'

Article by Robert Asahina February 13, 2013 //   2 minute read
So said Jimmy John Liautaud, founder of Jimmy John’s Gourmet Sandwich Shops, the second-fastest-growing chain in the U.S. Speaking on Tuesday as a panelist for the session “Business Leaders: The Bottom Line” at the Bush Institute’s conference in Chicago on “Tax Competition and 4% Growth,” Liautaud said, “We in the free market have felt the pain and adjusted our life,” but government has not. “We collect more in sales tax in our six stores in Champaign than we make in revenue,” he noted, but he’s not seeing any accountability from the Illinois state government for how it spends all the money it collects. And it’s not just taxes, but the overall “direction of the state” that has left him open to invitations from the governments of Texas and Indiana to relocate his business to a more business-friendly environment.

His frustration was echoed by Bruce Rauner, chairman of GTCR LLC, a private equity and venture capital firm in Chicago. His business has been “unsuccessful in convincing executives to headquarter In Illinois,” partly because of the high state taxes, but also because “we have almost no confidence” in Illinois state government because of its “incredible incompetence.” There is “no way we could ever pay for” the state’s unfunded pension liabilities. The one hope that Rauner held out was the development of a “wedge” between public-employee unions and advocates for state-funded social services (for the elderly, the poor, the handicapped). With debt mounting and budget cuts required, the interests of both traditional clients of big government cannot be met at current levels. So “the whole structure” of “low-quality, high-cost government has to change.”