- Associated Press - Thursday, October 9, 2014

PEORIA, Ill. (AP) - Democratic Gov. Pat Quinn and Republican businessman Bruce Rauner pitched vastly different strategies Thursday for improving Illinois’ economy, with the incumbent pushing for an extension to the income tax increase and asking the wealthy to pay more and his rival saying the state can’t keep taxing its way out of its problems.

With less than four weeks before the Nov. 4 election, the candidates for Illinois governor met in Peoria for their first televised debate.

While both campaigns have worked furiously in recent months to make the contest as much about character as the serious issues facing the state, the debate focused heavily on topics such as the economy, Illinois’ $100 billion unfunded pension liability and budget problems.

Quinn told voters he inherited a mess when he took office in 2009 amid a recession and with one previous governor in prison and another - now-imprisoned ex-Gov. Rod Blagojevich - ousted from office. He noted that unemployment is at a six-year low and said the key to making Illinois more attractive to businesses is to invest in education. He’d do that by making permanent the 67 percent income tax increase Democrats approved in 2011, rather than letting it decrease from 5 percent to 3.75 percent as scheduled on Jan. 1.

“I think the best way to go is to stay in this direction and do the right thing,” Quinn said.

The Chicago Democrat, who’s seeking his second full term, also supports a non-binding ballot measure to impose an additional 3 percent tax on incomes over $1 million - money that would go to schools.

Rauner opposes the so-called “millionaire tax,” which he says would put an added burden on families, farmers and small businesses.

The venture capitalist from Winnetka, who’s making his first bid for public office, also wants to reduce the income tax rate to its previous level of 3 percent over four years, which he says will make Illinois friendlier to business and lead to more job creation.

He refutes the Quinn campaign’s argument that his plan would lead to massive cuts to schools and other programs.

“We have got to grow our economy,” Rauner said. “What we can’t solve our problems by doing is just raising taxes on families like our current governor has done.”

Rauner also noted that Illinois’ unemployment rate remains one of the highest in the U.S. despite six straight months of decreases, and job growth lags behind other states.

The two candidates also differed on a solution to the state’s pension shortfall.

Quinn signed legislation last year that would fully fund the retirement systems by 2045, in part by cutting benefits. Public-employee unions have sued, saying the overhaul violates a provision of the constitution that says benefits can’t be reduced.

Rauner supports letting retirees keep the benefits they’ve been promised but freezing the systems and moving employees to a 401(k) style plan in which workers are not guaranteed a certain level of benefits. He said that plan - which is similar to what most private-sector workers have - wouldn’t save much money to start but would save billions in the long term.

“I don’t believe it’s right to change the payments to a retiree after they are already retired, and that’s what Gov. Quinn did,” Rauner said.

But Quinn called Rauner’s plan “risky” because workers’ retirements would depend largely on market performance. He said he deserves credit for making Illinois’ full pension payment each year he’s been governor - something his predecessors didn’t do. That contributed to Illinois having the worst-funded pension systems of any state in the U.S.

Rauner also said he wants to impose a tax on some services that are primarily “business-oriented.” Quinn says that would disproportionately hurt working people.

Thursday’s debate was sponsored by the League of Women Voters and Illinois’ public television and radio stations.

Libertarian candidate Chad Grimm did not participate in the debate because he failed to get at least 10 percent in a non-partisan poll, organizers said.

Rauner and Quinn are scheduled to debate two more times before Election Day, with their next meeting set for Tuesday.

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Follow Sara Burnett at https://twitter.com/sara_burnett and Kerry Lester at https://twitter.com/kerrylester .

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