If you conclude that all the non-national political news of the nation, or at least the Midwest, is being generated in Wisconsin these days, well, that’s not entirely correct.
To the south, Illinois, one of the few states whose finances were worse than Wisconsin’s, took the raise-taxes-and-bend-over-to-the-public-employee-unions approach. And, the Chicago Tribune reports:
Think back to 1/11/11, the night Democrats in the General Assembly raised personal and corporate income taxes by 67 and 46 percent. That legislation didn’t cut spending by one dime. Never forget the assurances, though, that these tax increases would pay the state’s debts and prevent future budget deficits …
One year later, though, stand back with us and look at all their carnage:
• Earlier this month, Moody’s Investors Service cited “weak management practices” when it awarded Illinois the nation’s lowest credit rating. Standard & Poor’s added insult to injury: “If Illinois does not make meaningful changes to further align revenue and spending and address its accumulated deficit (accounts payable and general fund liabilities) for fiscal years 2012 and 2013, we could lower the rating this year. … A downgrade could also be triggered if pension funding levels continue to deteriorate or debt levels increase significantly …”
• As [state budget director] David Vaught unwittingly attests, lawmakers continue to spend too much of other people’s money. [Gov. Pat] Quinn’s office now expects this fiscal year’s supposedly balanced budget to finish $507 million in the red. That’s right, even with $7 billion a year in new revenue from their tax hikes, this crowd still can’t balance a budget.
• Let alone pay those old bills. A new report from Comptroller Judy Baar Topinka carries the headline, “Backlog persists despite new revenue.” Deadbeat Illinois owes some $8.5 billion in old bills, tax refunds, employee health insurance and interfund borrowing debts. That’s roughly one-fourth of the state’s spending this year from its general funds. …
So Vaught is more right than he may want to admit: Until Illinois lowers its overhead (pension and Medicaid costs, that’s you), even tax hikes can’t, in truth, relieve “a squeeze for everything else.“
That probably won’t change until lawmakers cut their spending on that unaffordable overhead and deploy more tax hike revenue to pay old bills. Remember, the only reason Illinois has any old bills is that Springfield spent more money, and promised public employees far more in retirement perks, than revenues justified.
Worst of all, perhaps, the Democrats’ tax increases are stifling the economic growth that would boost those revenues. With their votes, they made Illinois an even higher-cost state for job creators.
After the fiscal disaster area left by Gov. James Doyle and the 2009–10 Legislature, Wisconsin’s state budget is now legally, if not actually, balanced. Illinois’ budget appears to be neither legally nor actually balanced. More than one Wisconsinites has asked why Gov. Scott Walker is being recalled and not Quinn.
If there’s anything Bill Schuette has established in his first year as Michigan’s attorney general — besides an appetite for media attention rivaling that of Sarah Palin or Geoffrey Fieger — it’s that he won’t stand for the federal government to trample on the rights of the people of Michigan.
Unless, or course, the right in question is one that Michigan’s top law enforcement official never cared for in the first place. In which caseany pretext for ignoring, circumventing or violating the state law that guarantees it is welcome.
I speak, of course, of Schuette’s maniacal campaign to single-handedly repeal the Medical Marijuana Act that Michigan voters adopted in 2008 — by a considerably wider margin (63%-37%), it should be noted, than Schuette enjoyed in his own victory (53%-42%) over a weak Democratic opponent two years later. …
But the AG has also exploited his office to target medical marijuana users and providers — precisely the people Michigan voters sought to protect from criminal prosecution when they adopted the MMA. That’s a flagrant abuse of authority — one that undermines respect for the law in general, not just the statute Schuette seeks to subvert.
In his latest initiative, Schuette has opined that police have a legal obligation not to return pot seized from licensed medical marijuana patients because possession of marijuana is still prohibited under federal law. (Never mind that the U.S. Justice Department, which has bigger fish to fry, especially in Detroit, has made clear its lack of interest in prosecuting patients in Michigan and other states that have authorized medical marijuana.)
In fact, the AG warned in an opinion issued late last week, officers who return illegally confiscated marijuana (in seeming compliance with a provision of the MMA that specifically bars its seizure from medical users licensed by the state) are themselves risking criminal prosecution as drug dealers.
Really? And what sort of prosecutor would file charges against a police officer for that? Even Schuette isn’t that deranged. …
But more than 3 million Michigan residents have made it clear they want licensed patients to be able to use marijuana for medicinal purposes. That’s almost twice as many as voted for Schuette in 2010.
So Schuette’s campaign to emasculate the MMA isn’t just unprincipled; it’s an affront to democratic rule — and to the rule of law he took an oath to uphold.
Nothing that Walker has done as governor justifies Recallarama. An attorney general’s willful flouting of the law probably justifies a recall, since attorneys general are supposed to enforce all laws, not just the ones they like, and not just the ones floating between their ears. As for Quinn, does mere grotesque incompetence justify a recall? If it does, then since a majority of Illinois voters were stupid enough to vote for Quinn (who took office after Gov. Rod Blagojevich’s corruption conviction), perhaps Illinois voters should recall themselves.
The latest evidence that Gov. Scott Walker and the state Legislature haven’t done enough to improve the state’s business climate comes from the Tax Foundation’s 2012 State Business Tax Climate Index.
In 2011, after eight years of Democratic Gov. James Doyle and two years of a Democratic-controlled Legislature, Wisconsin ranked 41st among the 50 states.
In 2012, after a year of Republican Gov. Scott Walker and a Republican-controlled Legislature, Wisconsin ranks 43rd — 32nd in corporate taxes, 45th in personal income taxes, 16th in sales taxes, 21st in unemployment insurance taxes, and 32nd in property taxes.
In the Midwest, Wisconsin trails Indiana (11th), Michigan (18th), Illinois (28th, although the Land of Lincoln dropped 12 spots), Ohio (39th) and Iowa (41st), and leads only Minnesota (45th).
Wisconsin dropped because other states improved their business tax climates. Republicans might argue that the Legislature was too busy repairing the fiscal disaster area in which Doyle and Democrats left the state, but that doesn’t help convince someone sitting in an office figuring out how much doing business in Wisconsin will cost that business to come here.
Why does a state’s business tax environment matter?
It is important to remember that even in our global economy, states’ stiffest and most direct competition often comes from other states. The Department of Labor reports that most mass job relocations are from one U.S. state to another, rather than to an overseas location. Certainly job creation is rapid overseas, as previously underdeveloped nations enter the world economy without facing the second-highest corporate tax rate in the world, as U.S. businesses do. So state lawmakers are right to be concerned about how their states rank in the global competition for jobs and capital, but they need to be more concerned with companies moving from Detroit, MI, to Dayton, OH, rather than from Detroit to New Delhi. This means that state lawmakers must be aware of how their states’ business climates match up to their immediate neighbors and to other states within their regions.
Anecdotes about the impact of state tax systems on business investment are plentiful. In Illinois early last decade, hundreds of millions of dollars of capital investments were delayed when then-Governor Rod Blagojevich proposed a hefty gross receipts tax. Only when the legislature resoundingly defeated the bill did the investment resume. In 2005, California-based Intel decided to build a multi-billion dollar chip-making facility in Arizona due to its favorable corporate income tax system. In 2010 Northrup Grumman chose to move its headquarters to Virginia over Maryland, citing the better business tax climate. Anecdotes such as these reinforce what we know from economic theory: taxes matter to businesses, and those places with the most competitive tax systems will reap the benefits of business-friendly tax climates.
The study counts personal income taxes (where Wisconsin ranks worst) most, in keeping with the large number of sole proprietors, partnerships, subchapter-S corporations and similar corporate entities in which profits and losses flow through to the shareholders. Sales taxes rank second, since sales taxes certainly affect how much product or service someone can buy. Corporate income taxes, which are paid by a business’ customers, rank third.
Wisconsin has five income tax brackets, from 4.6 percent to 7.75 percent. Under the maxim that if you want less of something, tax it more, Wisconsin’s official policy appears to be that we don’t want “rich” people, since we tax income of more than $152,740 at 6.75 percent and income of more than $224,210 at 7.75 percent.
Wisconsin bombs on personal income taxes not just because the rates (including the new rate the 2009–10 Legislature foisted on us) are too high:
Meanwhile, states where the tax base is found to cause an unnecessary drag on economic activity are New Jersey, New York, Wisconsin, California, Georgia, Maryland, Minnesota, and Virginia.
Marriage Penalty. A marriage penalty exists when a state’s standard deduction and tax brackets for married taxpayers filing jointly are not double those for single filers. As a result, two singles (if combined) can have a lower tax bill than a married couple filing jointly with the same income. This is discriminatory and has serious business ramifications. The top-earning 20 percent of taxpayers is dominated (85 percent) by married couples. This same 20 percent also has the highest concentration of business owners of all income groups . …
Double Taxation of Capital Income. … The ultimate source of most capital income—interest, dividends and capital gains—is corporate profits. The corporate income tax reduces the level of profits that can eventually be used to generate interest or dividend payments or capital gains. This capital income must then be declared by the receiving individual and taxed. The result is the double taxation of this capital income—first at the corporate level and again on the individual level.
All states with an individual wage income tax score poorly by this criterion. …
The Federal Alternative Minimum Tax (AMT). The Alternative Minimum Tax (AMT) was created in 1969 to ensure that all taxpayers paid some minimum level of taxes every year. Unfortunately, it does so by creating a parallel tax system to the standard individual income tax code. Evidence shows that the AMT is an inefficient way to prevent tax deductions and credits from totally eliminating tax liability. As such, states that have mimicked the federal AMT put themselves at a competitive disadvantage through needless tax complexity. Nine states score poorly for having an AMT on individuals: California, Colorado, Connecticut, Iowa, Maine, Minnesota, Nebraska, New
York, and Wisconsin.
Wisconsin’s personal income tax penalizes married couples and taxes investment income. (See previous maxim about getting less of something by taxing it more.)
The fact the state has a flat corporate income tax rate is good. The fact that the corporate income tax rate is 7.9 percent is bad. Three states — Nevada, South Dakota and Wyoming — have the correct corporate income tax rate: Zero. And when there are no corporate income taxes (or substitutes such as gross receipts taxes), there is no need for job, R&D, investment or any other tax credits. Nor are there issues about what’s deductible from corporate income taxes, or carrybacks or carryforwards. Nor is there any legislative lobbying over corporate income tax provisions.
The state’s sales tax rate of 5 percent is lower than our neighbors, until a future Legislature increases the sales tax for education, as if more school spending means better schools. (The only thing preventing the sales tax from being extended to groceries is the likelihood of legislators’ surviving the day they vote for that.) There also have been proposals to extend the sales tax to professional services that are not currently taxable; those proposals never include words like “and then reduce the sales tax rate,” of course. The state has high gas and diesel taxes, though no longer the highest since automatic indexing of fuel taxes ended, and at least we don’t also pay sales taxes on gas and diesel.
The one state tax that could be considered low is the alcohol tax — 6 cents per gallon of beer and $3.25 per gallon of liquor — until, that is, the anti-alcohol scolds succeed in getting a future Legislature to raise alcohol taxes because alcohol makes people do dumb things. (That’s the same rationale as banning guns because guns kill people.)
As I’ve written here before, taxes are one component — arguably the most important component, but not the only component — of a state’s business climate. Of course, overregulation inevitably shows up in taxes too, because regulations take government employees to enforce, and employees and what supports government employees (office space, computers, etc.) cost money. The only thing state government spends more money on than employees is shared revenues to the state’s 3,120 units of government.
So how should the Legislature improve the state’s business tax climate? The Tax Foundation has two guiding principles:
1. Taxes matter to business. Business taxes affect business decisions, job creation and retention, plant location, competitiveness, the transparency of the tax system, and the long-term health of a state’s economy. Most importantly, taxes diminish profits. If taxes take a larger portion of profits, that cost is passed along to either consumers (through higher prices), employees (through lower wages or fewer jobs), or shareholders (through lower dividends or share value). Thus a state with lower tax costs will be more attractive to business investment, and more likely to experience economic growth.
2. States do not enact tax changes (increases or cuts) in a vacuum. Every tax law will in some way change a state’s competitive position relative to its immediate neighbors, its geographic region, and even globally. Ultimately it will affect the state’s national standing as a place to live and to do business. Entrepreneurial states can take advantage of the tax increases of their neighbors to lure businesses out of high-tax states.
In reality, tax-induced economic distortions are a fact of life, so a more realistic goal is to maximize the occasions when businesses and individuals are guided by business principles and minimize those cases where economic decisions are influenced, micromanaged, or even dictated by a tax system. The more riddled a tax system is with politically motivated preferences, the less likely it is that business decisions will be made in response to market forces.
That first point — taxes diminish profits — gets to the core of a business, and in fact so-called “nonprofits” as well. Nothing happens unless there’s more money coming in than going out. No business or organization that has more money going out than coming in has much of a future.
If this makes you wonder about the Legislature’s priorities, it should. Walker seems likely to survive his recall attempt, but Republican state senators may not. If the Senate switches sides, that will end any chance of tax cuts, since we know that Democrats have already proposed business tax increases as part of their proposal to reduce government waste, fraud and abuse.
The Legislature needs to eliminate corporate income taxes (and not replace them with something worse, such as gross receipts taxes) and reduce personal income taxes, both in rate and in ending the marriage penalty and investment taxation. If that means, as inconceivable in the People’s Republic of Wisconsin as it may seem, cutting government spending (instead of crowing about how government spending increased by only 1 percent), then that is what’s required. Holding the line on property taxes was fine, except that property taxes are relatively low for manufacturers, thanks to the Manufacturing & Equipment exemption (signed into law by Gov. Patrick Lucey, Wisconsin’s last pro-business Democrat). Holding the line on other business taxes, particularly the sales tax, should go without saying.
Business tax climate is less about the businesses in Wisconsin now than it is about the businesses that may, or may not, decide to locate in Wisconsin. It could be argued that businesses now in Wisconsin have reconciled themselves to the state’s crappy tax climate. (Except, of course, for those that decide to leave Wisconsin.) But Wisconsin trails the nation in such measures of business vitality as start-ups and incorporations, venture capital and, for nearly three and a half decades, per capita personal income growth. Wisconsin also is a leader, if you want to call it that, in business corporate headquarters leaving the state, beginning with Kimberly–Clark’s headquarters departure for Texas in the 1980s.
That previous paragraph means that if you want to see the bad business trends reversed and as a result see more private-sector jobs in Wisconsin (because private-sector jobs are the only jobs that count from a macroeconomic perspective), you need to improve the environment into one where business will not be penalized by government by onerous taxation. The word “Wisconsin” does not mean “onerous taxation” in either an American Indian language or in French, but it should.
Instead of asking politicians about Wisconsin’s job numbers (for instance, the party in charge when 94,000 Wisconsin jobs disappeared in 2009), WFRV-TV in Green Bay asked an actual expert:
According to Lawrence University Professor of Economics Marty Finkler … a lack of venture capital is slowing growth in Wisconsin.
“That is the funding needed to expand from a start up to an substantial enterprise” explains Finkler.
He says the potential recall of Governor Scott Walker is also contributing to uncertain conditions.
“Why commit long term to a set of policies that you don’t know are going to stay in existence” says Finkler.
Professor Finkler also believes Wisconsin has a lack of skilled workers in growing trades. “To get the desirable kinds of employment we have to educate our people and keep them here”.
I was on Wisconsin Public Radio when I commented about the uncertainty issue, which my opponent (a non-business person) immediately pooh-poohed. It’s nice to be proven right by someone who knows what he’s talking about. That also suggests that the Recall ______ forces are indeed hurting Wisconsin’s economy, and will continue to do so as long as they are in existence.
Finkler’s comment about skilled workers is echoed by Todd Teske, chairman of Briggs and Stratton, who told the Wisconsin Reporter: “Manufacturing has been, and continues to be, the core of family-supporting middle class jobs in Wisconsin. But those jobs are threatened by a number of factors, including a shortage of skilled industrial workers to fill existing and expected job vacancies.”
Added Kurt Bauer, CEO of Wisconsin Manufacturers & Commerce: “Many tech colleges report that students show little interest in their industrial skills training programs. In other words, there is low demand for the classes that teach the skills manufacturers need. … Educating young people, as wells as the people they listen to, i.e. their parents, teachers, counselors, about the opportunities and reward in industry is the first step.”
Apparently everyone who didn’t vote for Republican gubernatorial candidate Scott Walker in 2010 (minus the hundreds of thousands of fraudulent signatures, of course) signed a petition to recall Walker.
Then, on Wednesday, Kathleen Falk, former Dane County executive and twice-failed statewide candidate, announced she is running against Walker, assuming the number of fraudulent signatures doesn’t invalidate the recall drive.
As far as I’m concerned, Falk is a perfect candidate. Perfect, that is, to symbolize the stupidity of Recallarama, and to symbolize the theme of Madison vs. the rest of Wisconsin.
Falk — or as exiled Madison conservative blogger David Blaska calls her, The Kathleen — was the Dane County executive for 14 years, after she was the state’s public intervenor, a former state Justice Department position designed as an intentional environnment-motivated bottleneck. (One of Gov. Tommy Thompson’s greatest accomplishments was the elimination of the public intervenor position.)
Falk has one thing in common with another supposed recall candidate, Milwaukee Mayor Tom Barrett. Both are two-time statewide election losers. Falk and Barrett both lost in the 2002 Democratic gubernatorial primary, then, four years later, after beating Attorney General Peg Lautenschlager in the Democratic primary due to the latter’s drunk driving conviction, in what was a very good year for Democrats, Falk nonetheless lost the general election to then-unknown Republican J.B. Van Hollen.
Falk started her political career as an environmental lawyer. The irony is that Falk undoubtedly will tout her economic development credentials, which in a county that includes state government and the state’s largest university is like opening a faucet and announcing that you’ve discovered water. Moreover, a drive through Dane County (which I do every few months, most recently in December) shows a considerable amount of what the envirofreaks (which Falk used to represent) would call “sprawl.”
You should probably ask current and former Dane County supervisors from districts outside greater Madison what they think of her work. That is important because Wisconsin is still a mostly rural state. One wonders what kind of limits on growth in non-urban areas a Governor Falk would support. Falk supported the $800 million waste of taxpayer money that would have been the Madison-to-Milwaukee not-really-high-speed train, a train most Wisconsinites would not have used but all would have been required to pay for.
In doing research for my most recent anti-Madison blog, I came upon a University of Wisconsin master’s-degree thesis, Growth Machine Theory and Urban Political Decline: A Case Study and Empirical Review: The Madison South Beltline Highway, Madison, Wisconsin. (Only academics and would-be academics write 20-word titles that include two colons, by the way.) The thesis, available online from the UW Memorial Library, shows the opposition of the state Public Intervenor — Falk and her predecessor — on specious grounds that building a new South Beltline south of Monona’s East Broadway could lead to less consumer spending in downtown Madison and Madison population loss. So all the people killed and maimed on car crashes before the new South Beltline opened in 1988, well, ask The Kathleen about them. So should those who were victims of two-lane U.S. 12 between Middleton and Sauk City, whose upgrade Falk opposed.
Whatever hired flack wrote Falk’s Wikipedia page, which was updated Tuesday, notes her “balanced budgets and capped property tax levies,” which only means Falk did what she was required to do under state law. Falk also substantially increased Dane County government spending and employment, which serves as a nice preview for what she would do as governor. Some of that spending included using tax dollars to purchase wetlands to prevent development, including a parcel between Lake Waubesa and Upper Mud Lake that was under water. (Really.)
There’s also the laughable part about Falk’s being a “tough but fair negotiator” with Dane County’s unions. That sentence demonstrates the grotesque faults of government employment in Wisconsin — that (1) public employee unions exist and (2) negotiations take place instead of employees’ being given the choice of taking the offered salaries and benefits, or working elsewhere. The fact that government unions will all endorse Falk also proves that state employee unions will get more than everything they could ever wish for should a majority of Wisconsin voters lose their minds and vote for Falk.
Since the Wisconsin Democratic Party is not being run by adults, as demonstrated every time party chair Mike Tate and mouthpiece Graeme Zielinski open their mouths, it’s probably a waste of my typing to suggest that Wisconsin Democrats need to find candidates for statewide office who do not reflexively support every idiotic idea that comes from Madison or Milwaukee at the expense of the rest of the state. On the other hand, maybe such non-Axis Democrats as Sens. Dave Hansen (D–Green Bay), Robert Jauch (D–Poplar), Jessica King (D–Oshkosh) and Jennifer Shilling (D–La Crosse) and Reps. Penny Bernard Schaber (D–Appleton), Janet Bewley (D–Ashland), Jill Billings (D–La Crosse), Chris Danou (D–Trempealeau), Gordon Hintz (D–Oshkosh), Nick Milroy (D–South Range) and Donna Seibel (D–Wausau) are perfectly happy having their constituents dictated to by the People’s Republic of Madison on such issues as land use, hunting and their Second Amendment rights.
The gubernatorial recall has always been about who is in charge in Wisconsin — government employees or taxpayers. The state should be run for the benefit of the 85 percent of workers who do not work for government whose taxes pay for those who do. Vote for Falk, and the state will once again be run by the public employee unions.
Tim Nerenz reveals the people those who signed Scott Walker recall petitions are supporting, whether they admit it or not:
And kudos once again to opponents of Wisconsin Governor Scott Walker who celebrated their Dr. Martin Luther King Day holiday yesterday by hissing and chanting at the Governor during a solemn proclamation honoring Dr. King at the State Capitol in Madison.
In doing so, the Democrats notched yet another important victory for loutish self-absorption over common decency in the continuing battle for the hearts and minds of independent voters in the Badger State.
The highlights of their perfect season, undefeated by couth, includes shouting down the Pledge of Allegiance, booing the National Anthem, disrupting a ceremony honoring Special Olympians, and hassling returning troops, just to name a few. Their behavior in our Capitol rotunda would get them thrown out of Walmart.
Forget Scott Walker; you guys should recall your mom.
Or whoever it was that raised you to believe it was ok to interrupt ceremonies, hurl vulgarities at 14-year-old girls, disenfranchise cloistered nuns, bribe children with cigarettes to sign recall petitions, stalk the families of public officials, throw beer or coffee on opponents, make death threats, and try to shut down dissenting media outlets. …
I can understand why Democrats and unionists might not think disrupting an MLK commemoration is any big deal; after all, Dr. King had to fight Democrats to get black people their right to vote, and he had to fight unions to integrate the workforce. It is unlikely that the union/government schools tell students who was the party of the KKK and separate-but-equal back in the day.
So what if Dr. King gave his life? That is nothing compared to having to pay 12% of a health insurance premium, right? And how can we equate something trivial like institutionalized segregation with something really awful, like allowing school boards to compete those WEA trust insurance contracts now that the scam is blown? …
We are about to waste $9 million of our hard-earned money to give our Democrats another mulligan, money that will not be available for education, the elderly, the environment, cancer research, bridge repairs, or bike paths. Or, God forbid, tax relief for working people who can hardly make ends meet, thanks in part to one of the highest tax burdens in the country.
Two-thirds of that recall money will be paid by Republicans and Independents, both of whom overwhelmingly approve of the job Governor Walker is doing – the job he was elected fair and square to do.
It will come out of township budgets across the state, townships run by common-sense people from both Parties who would prioritize snow removal over an unbudgeted election if it were up to them – and us. If it were up to us, we would have the election to recall Scott Walker in November of 2014, when it was originally scheduled.
But it’s not up to us. It’s up to people whose moms did not teach them to wait their turn. It is up to union bosses from out East, together with the Madison liberals who think everyone’s money istheir money, the Chicago urban vote factory which views Milwaukee as a colony, and out of state students who will leave us after graduation, taking with them the benefit of one of the best educations taxpayer subsidies can buy.
Many of those students putting their idealism and energy behind the Walker Recall will relocate to the low-tax, Right-To-Work, concealed carry, energy-friendly, business-friendly states where there is opportunity. I wish they would use that enthusiasm to help Governor Walker and his successors turn Wisconsin into one of those states, so they could find opportunities here.
Gemma Carroll provides visual evidence of Nerenz’s points:
Christian Schneider on with whom Sens. Jessica King (D–Oshkosh) and Tim Cullen (D–Janesville), supposed gubernatorial recall candidate, are hanging around these days:
If the recent controversy over collective bargaining in Wisconsin has done anything, it has lifted up a rock to expose how many cretins manage to slither below the surface of legitimate political dialogue. …
Then there’s liberal hero Ian Murphy, who impersonated billionaire David Koch while making a now-famous prank phone call to Gov. Scott Walker. Murphy, a blogger, was immediately lionized by union loyalists for supposedly “exposing” Walker’s ties to the Koch Brothers (whom Walker claims he has never met). …
On Tuesday, the 540,000 signatures needed to force a recall election of Governor Walker are due; and in advance of this momentous occasion, Democrats have sent Murphy on a barnstorming tour to drum up support for the recall. Local newspapers have photographed Murphy chumming it up with incumbent state senators, many of whom fled the state last February in order to block a vote on the collective-bargaining bill. Flyers offer attendees the chance to “meet special guest Ian Murphy of the Daily Beast, famous for his ‘Fake David Koch’ phone call.”
But that isn’t the only thing that has brought fame to Ian Murphy. In May 2008, he wrote a vile column titled “F*** the Troops,” in which he ridiculed the notion that we should honor those fighting for our country. Among Murphy’s “greatest” hits (warning: profane language):
● “So, 4000 rubes are dead. Cry me the Tigris. Another 30,000 have been seriously wounded. Boo f***ing hoo. They got what they asked for — and cool robotic limbs, too.”
● “The benevolence of America’s ‘troops’ is sacrosanct. Questioning their rectitude simply isn’t done. It’s the forbidden zone. We may rail against this tragic war, but our soldiers are lauded by all as saints. Why? They volunteered to partake in this savage idiocy, and for this they deserve our utmost respect? I think not.”
● “The nearly two-thirds of us who know this war is bullshit need to stop s***ing off the troops. They get enough action raping female soldiers and sodomizing Iraqi detainees.”
● “As a society, we need to discard our blind deference to military service. There’s nothing admirable about volunteering to murder people. There’s nothing admirable about being rooked by obvious propaganda. There’s nothing admirable about doing what you’re told if what you’re told to do is terrible.”
● On John McCain: “Again, what is heroic about involving one’s self in a foolish war, being a sh***y pilot or getting tortured? Yeah, it must have sucked, but getting your ass kicked every day for five years doesn’t make you a hero—it makes you a Bad News Bear.”
● “But what kind of world would we rather live in: one where fools are admired for being fooled and murderers are extolled for murdering, or one where we have the capacity to step back and say, ‘I don’t care who told you to do what and why; you’re still an asshole!’ Personally, I’d rather live in a world where people who act like retards are treated like retards: executed in Texas.”
And on and on it goes.
Of course, anyone who is familiar with politics sees these reptiles trolling around on message boards and on Twitter. But Ian Murphy is now headlining legitimate events thrown by legitimate Democrats, none of whom will even acknowledge his puerile radicalism. (Very little, if any, of Murphy’s past has been reported in the state media, save for Milwaukee-area conservative talk radio.)
Miss Wisconsin won the Miss America pageant on Saturday night. She clearly represents the pretty side of the state. But Ian Murphy has given everyone a glimpse of how ugly it can be, too.
Regular readers know that state finances were worse than the Doyle administration admitted during its eight years of fiscal incompetence. But state finances are also worse than the Walker administration admits now.
The proof is the state’s Comprehensive Annual Fiscal Report, an inch-thick annual tree-killer that summarizes the differences between politicians’ claims about the state’s fiscal health, and the reality of the state’s fiscal health.
When does an expenditure occur — when a credit card is used to make a $10 purchase, or when the $10 charge on the credit card bill is paid? Elected state officials would say the latter: No cash transaction occurs until the credit card bill is paid. CPAs who follow generally accepted accounting principles (GAAP) in preparing the CAFR would disagree: When an item is charged is key, for it creates an obligation that must be paid. In technical terms, the difference between the two viewpoints is the difference between cash and accrual accounting.
What this means practically is that governors and lawmakers can “balance” a budget—as state law requires—even when the relevant CAFR later shows a deficit for the same period.
State law requires that the state budget be balanced on a cash basis. It is, to put it bluntly, insane for an enterprise that spends nearly $35 billion every year to balance its books with the same accounting method as a four-employee business. (Shareholders of a $35 million business would fire its CEO if he claimed that cash accounting was OK for a business of that size.)
Failure to correctly balance the state budget violates, at least in spirit, Article I, section 22 of the state Constitution:
The blessings of a free government can only be maintained by a firm adherence to justice, moderation, temperance, frugality and virtue, and by frequent recurrence to fundamental principles.
Keep this in mind before you read on: Between the 1999 and 2009 fiscal years, only 15 states had a GAAP deficit in any of those fiscal years. But between the 1990 and 2011 fiscal years, Wisconsin had a GAAP deficit every single fiscal year, starting at $740 million in 1989–90, to $1.08 billion in 1990–91, to $2.24 billion in 2002–03. The GAAP deficit grew every fiscal year during the Doyle administration from 2004–05 onward.
At the end of the 2008–09 fiscal year, Wisconsin’s GAAP deficit was $2.71 billion, better than only California, Illinois and New York, four of the 12 states that had GAAP deficits in 2008–09, according to the WTA. The 2008–09 GAAP deficit was $479.53 per capita and 1.11 percent of GDP, better than only Illinois. Wisconsin was one of only 15 states to have GAAP deficits in any year between the 1999 and 2009 fiscal years, but Wisconsin and Illinois were the only two states in the nation to have GAAP deficits in every one of those fiscal years.
On June 30, 2010, the end of the 2009–10 fiscal year, the state had a cash balance of $89.6 million. But measured by the more accurate Generally Accepted Accounting Principles, the state had a deficit of $2.94 billion, or $517 per capita.
So how is the state doing after a year of the Walker administration? By at least two measures, worse.
The general fund balance deficit of $2.94 billion in the last full fiscal year of the Doyle administration has grown, as listed on page 44 of the CAFR, to $2.995 billion. The only good thing about that number is that it is a smaller percentage of state government spending, 13.5 percent vs. 13.8 percent in the previous fiscal year.
Eight months ago, I wrote that the state’s Unrestricted Net Assets (gross assets minus money owed on those assets) was a negative number, $9.46 billion, better than only seven states in dollar amounts and, at 3.7 percent of GDP, better than only five states. The WTA’s report noted that “this means ‘no funds were available for discretionary purposes,’ such as paying off creditors.” One fiscal year later, the definition of “no funds were available” expanded to a bigger (in absolute value) negative number, $9.7513 billion.
It should be pointed out that the state was operating on its 2009–11 budget, crafted (if that’s what you want to call it) by the Doyle administration and enacted into law (with, remember, $2.1 billion in tax increases) by the Democratic-controlled 2009–10 Legislature. It also should be pointed out that Walker and the 2011–13 Legislature passed the controversial (to say the least) budget repair bill early in 2011 to address the $136 million deficit in the existing 2009–11 budget. It also should be pointed out that the 2011–13 budget was enacted to eliminate the $3.6 billion structural deficit the 2009–11 budget created for the 2011–13 budget cycle.
The WTA adds:
The good news is that the descent into debt slowed. The state added more than $200 [million] to the GAAP deficit in each of the prior two years but only about $50 [million] in 2010-11. Moreover, with few, if any, budget-balancing maneuvers used in the new 2011-13 budget, the deficit reported on the CAFR appears to have “bottomed out.” Whether the trend can now be reversed is up to the state’s current and future elected officials.
There is no question that the 2011-13 state budget is a tight and painful one that cuts most major programs, except Medicaid, but it will not erase the deficit reported on state financial statements next year at this time. It will, however, accomplish something not done since the mid-1990s: Lay the foundation for a new state budget (in 2013) that does not first require paying off budget-balancing IOUs from the prior year.
What this means according to state budget experts is that, entering the 2013-15 budget period, Wisconsin would have no “structural deficit” for the first time since the mid-1990s. Lawmakers would be able to prepare a budget with an eye to future opportunities, rather than past obligations.
Before state legislators and lobbyists begin planning future spending increases, however, they would be wise to remember that underlying state fiscal problems remain. State financial statements will still have large general fund deficits that require repair.
As a bipartisan state legislative committee (on which I served) urged 10 years ago, now is the time to begin scaling back the deficits on these financial statements. Those evaluating state bonds will respond with higher ratings, and markets will respond with lower interest rates that the state must pay. Then Wisconsin citizens can say that state finances are truly “back on an even keel.”
It boggles the mind that most states are able to balance their budgets on a GAAP basis, but Wisconsin has not been able to for more than two decades, with Republican and Democratic governors, and with Republican, Democratic and split party control of the Legislature. Any state legislator or commentator who claims state government is lean is not telling the truth.
Berry claims the 2011–13 budget was “a tight and painful one,” but truth be told, it was not nearly “tight and painful” enough. The Walker administration credits itself for having eliminated the 2007–09 deficit through making government employees pay more for their benefits without large-scale state employee layoffs. All that did was to reduce the GAAP deficit on a percentage-of-state-spending basis, not in an actual dollar amount.
If eliminating the GAAP deficit means cutting state general-fund spending by 13.5 percent, that is what is required, and that is what should have happened in the 2011–13 state budget. If that means permanently laying off thousands of state employees and eliminating state programs, that is what is required. (The only jobs worth creating are private-sector jobs.) Every budget cycle state legislators put off actually balancing the state budget, state finances get progressively worse.
Fortunately, some people realize the ugly state of state finances. Walker created the Governor’s Commission on Waste, Fraud and Abuse, whose mandated report came out this week. The fourth of the commission’s five recommendations, according to the MacIver Institute:
The State of Wisconsin should be doing business on a GAAP basis. In my opinion the modified cash basis currently in place allows for cutoff issues and could be used to circumvent the State’s balanced budget requirement.
“Could be used” should have been written instead as “is being used” to make a mockery of the state’s balanced-budget requirement. That should be fixed in two ways — the state law that requires only cash balancing should be changed to require GAAP balancing, and then that GAAP-balance requirement should be added to the state Constitution. (Along with constitutional limits on year-to-year spending increases and supermajority or referendum requirements for tax increases.)
The state of state finances — whether you’re slightly optimistic about the current direction or not — demonstrates once again the necessity of protecting us taxpayers from our elected officials.
The commission was created by the Legislature as part of the 2011–13 state budget to …
… examine issues related to the future of transportation finance in Wisconsin, including the following:
Highway maintenance, rehabilitation and expansion projects
Local aid and assistance programs, including general transportation aids (GTA)
Transportation fund revenue projections
Transportation fund debt service
Options to achieve balance between revenues, expenditures and debt service
Impact of highway project planning on abutting property
The commission is meeting in Madison Thursday, Milwaukee March 22, Appleton April 26 and Eau Claire May 31 to get public input as part of the process of creating a report the Legislature is requiring the commission to complete by March 1, 2013. The commission will also take public input at dottfpcommission@dot.wi.gov.
(Want some public input? Here goes: Wisconsin 23 between Ripon and Fond du Lac needs to be four lanes ASAP. I am tired of being stuck on 23 behind someone who cannot differentiate between a 4 and a 5 either on the lower left of speed limit signs or that person’s car speedometer.)
As it happens, I know, or know of, a few of the members. I’m pleased to see Barb Fleisner, executive director of Centergy, the Central Wisconsin regional economic development effort, and a former Marketplace Magazine cover subject. A representative of Schneider National, one of the nation’s largest trucking firms, is in the group, as are a couple of companies related to road construction. The head of the Transportation Development Association of Wisconsin, a group that advocates for road construction even if it requires higher taxes, is in the group too. I am not pleased to see former Madison mayor Dave Cieslewicz in the group, although I suppose he’s there to represent the cars-suck constituency.
One of the most visible pieces of evidence that suggests that former Gov. and current U.S. Senate candidate Tommy Thompson was a big-government conservative is the vast expansion of freeways over Wisconsin since I’ve gotten my driver’s license. I grew up a mile south of where Interstate 90 goes to Chicago, Interstate 94 goes to Milwaukee and then Chicago, and I–90/94 head north until they split near Tomah to go to, respectively, La Crosse and the Twin Cities. Interstate 43 between Milwaukee and Green Bay, the snippet of Interstate 535 that connects Superior and Duluth, the snippet called Interstate 794 down Milwaukee’s lakefront, and Interstate 894 through Milwaukee’s southern suburbs were the only other Interstate highways in Wisconsin. I only knew of I–90 and I–94 through Madison because if you live in Madison, you’re unlikely to go to Milwaukee to go somewhere north and south.
Looking at Wisconsin’s Interstate mileage vs. other states may have been the first time I wondered what the hell our elected officials were doing in Washington. Some of U.S. 41 and U.S. 51 was four-lane, though with intersections instead of interchanges in many spots. There was also the Beltline Highway, much of which was freeway, but the most dangerous parts, East Broadway in Monona, were not. Most Wisconsin roads had just two lanes, including the high-traffic roads such as U.S. 151, along with, once I moved northeastward, U.S. 10 and Wisconsin 29.
Now, three decades after I got that piece of freedom called a driver’s license, freeways and four-lanes cover much more of Wisconsin’s landscape. U.S. 51 north of I–90/94 is now Interstate 39 to Wausau. I’m not sure why Wisconsin 15 between Beloit and Milwaukee’s west side was built as a freeway, but it is now part of I–43. U.S. 41 from Milwaukee to Green Bay via Fond du Lac, Oshkosh and the Fox Cities will be Interstate 41, 55 or 243 (or so speculation goes) in 2014. U.S. 10 is no longer known as “Highway Hell” (or so WGBA-TV called it) now that 10 is four lanes from the Fox Cities to Stevens Point and will be four lanes west of Stevens Point. Wisconsin 29 lost its “Bloody 29” nickname now that it is four lanes from Green Bay through Wausau to I–94. U.S. 53 is four lanes from Eau Claire north to Superior. My one-year commute to New London was made more tolerable because of U.S. 45, which is four lanes from Oshkosh to U.S. 10. And U.S. 151, the four-lane I’ve spent the most time on over the years, is four lanes from Fond du Lac through Madison to Dubuque.
That’s a lot of road construction, some of which started in the 1980s, more of which started in the 1990s. Some argue that is the result of the excessive political influence of the road-builders. Former state Sen. Brian Burke (D–Milwaukee) used to complain about “building four-lane roads to nowhere,” a place presumably not called Milwaukee. (Burke’s political career ended badly, let’s just say.) The Sierra Club, the leaders of Wisconsin’s Plants Before People movement, bemoaned the death of the $822-million pseudo-high-speed-rail project, calling projects that, unlike Madison-to-Milwaukee train projects, benefit a majority of travelers a “boondoggle.”
(I knew two people who died and one person who was permanently injured on roads that weren’t upgraded soon enough. You can conclude that environmental groups don’t bother to contact me for donations.)
The fact remains, however, that more Wisconsinites use roads than any other mode of transportation by a large margin. Road projects, after all, only benefit those who want to get themselves or get something from one place to another in this state on their own schedule. That includes travelers from point A to B and businesses that sell products. The former benefit from trains, buses and commercial aircraft only if they’re following the train’s or bus’ or airline’s schedule. Freight trains are fine for the latter if their products are large enough to make the cost economical, except that something has to get the product from the train to where it’s sold, and that will not be a train.
One subject the commission will deal with is how to fund transportation projects. Gov. James Doyle raided segregated funds, including the transportation fund, to “balance” his unbalanced budgets. That has been stopped by state Constitutional amendment. The problem, though, is that gas and diesel tax receipts drop when people buy less fuel from a combination of driving less (a byproduct of a weak economy) and driving more economical vehicles. That being the case, fuel taxes tax those who use more fuel, which results when you drive more.
One partial solution is to use sales tax proceeds from transportation purchases — for instance, car purchases — to augment the transportation fund. That is a partial solution, but it has the benefit of forcing state government to prioritize its spending of the total state tax dollar.
Another is to be more selective about which projects get done. The DOT’s Connections 2030 plan involves projects in every mode of transportation you can think of, including transportation modes in places that don’t presently have them (for instance, passenger rail). I am not an opponent of roundabouts (in fact, I prefer them to stoplights, and I vastly prefer them to four-way stops), but one sometimes gets the impression that road projects are chosen based on the opportunity to install roundabouts instead of installing roundabouts as part of regularly scheduled road projects.
A third is to spend money generated by road users only on roads, and not on little-used projects that don’t benefit most people’s first transportation method. I occasionally bike (when I can pry my bike out of our oldest son’s hands), but I would not argue that spending money on, for instance, converting abandoned railbeds to bike trails is a particularly efficient use of scarce tax dollars. You want mass transit? Pay for it yourself, Madison and Milwaukee. You want trains? Most people disagree with you.
The four-letter word “toll” inevitably will come up. Tollways would be immensely unpopular in Wisconsin. Most people who have had the misfortune of traveling the old Illinois tollways think of stopping every 20 miles or so to throw coins in baskets. (Not to mention the patronage machine known as the Illinois Tollway Authority.) The wireless toll transmitter is more convenient, but also easier to abuse, given that a few keystrokes create a rate increase.
For my money, road improvements are one of the few provably valuable uses of our tax dollars. I think about that every time I drive on Madison‘s South Beltline, which goes south of the old, bad East Broadway, which was simultaneously crowded, slow and dangerous, and took too much time to be replaced. (East Broadway is still there, but with about one-tenth of the traffic.) With road projects, you get to see what you’ve paid for.
Tim Nerenz suspects a conspiracy between the feds and opponents of Gov. Scott Walker, and for good reason:
Recently, the Bureau [of Labor Statistics] named Wisconsin as the state with the worst job loss in November, with a decline of 14,600. This came on the heels of 9,700 jobs BLS reported lost in October. The Badger State’s two-month total of 24,300 jobs lost led the nation in workplace suckage; and opponents of Wisconsin Governor Walker eagerly jumped on the November BLS presser to bolster their sagging effort to recall him.
One anonymous commenter on my blog site asked me (ok, taunted) what I had to say about those BLS numbers, since I had just written a piece opposing the recall. Instead of reading the BLS press release, I visited the underlying data tables (http://www.bls.gov/news.release/laus.t03.htm) and discovered a slightly different story.
The BLS data show that Wisconsin’s workforce dropped from 3,057,800 in September to 3,055,200 in November, while the number of unemployed in Wisconsin fell from 238,600 to 223,800. Since the workforce is only made up of two parts — the employed and the unemployed — simple subtraction reveals there were 2,819,200 people working in September and 2,831,400 in November.
Do you see what’s wrong with this picture?
That’s right — the BLS data shows an increase of 12,200 jobs during those two months, not the loss of 24,300 reported to the press by the union humps who run the joint. I asked them for an explanation — two bucks says I will hear from Dick Clark again before I get any response from the humble public servants who work for me. Five bucks says no journalist will even bother to ask.
The BLS data reconciles perfectly; unemployment drops by 14,800 because 12,200 jobs are added and 2,600 leave the workforce (retire, move out of state, go back to school, etc.). On the other hand, I could find no combination of numbers that can be tortured into a computation of a 24,300 job loss in October/November. If you can crack the code, I will be happy to print the recipe here at Moment of Clarity.
Why would the BLS report something different from its own statistics?
So I am not surprised that the BLS data does not support its agency heads’ pressers. It doesn’t take a lot of imagination to guess at possible reasons why Obama appointees at the Department of Unions might want to propagandize against the nation’s top union buster, Governor Walker. Or perhaps it was just a simple error — two months in a row. Yeah … yeah, that’s the ticket.
And don’t even get on your high horse, Demski’s; it’s not about you. I don’t care if they are Republican, Democrat, or just members of the Permanent Government Workers Party, they say whatever they want if it serves their own interest. If my Libertarian party ever took control, we would soon be corrupted too; human nature does not grant waivers to humans.
That’s why we need to shut it all down; all but the 18 essential services authorized by the Constitution. Put the Department of Labor and its Bureau of Labor Statistics high on the list of first to go. If you want accurate labor statistics, buy them from Manpower; they are a private sector firm that makes their living by accurately assessing job markets. They are not too big to fail, so they have to get it right.
The last Presteblog of 2011 is called That Was the Year That Was 2011, a tradition of the Marketplace of Ideas column from 1994 to 2000 and then of the Marketplace of Ideas blog from 2008 to 2010.
The title comes from the British TV series “That Was the Week that Was,” a weekly satirical series that made David Frost and Roy Kinnear popular:
While the TWTYTW 2010 blog no longer exists (ask my former employer what happened to it), a video version of sorts does still exist courtesy of FDL Podcasting:
There was one prediction that I didn’t make — the creation of this blog for the reason you all know. For what it’s worth, this blog is nine months old today. This was not how I planned to spend three-fourths of 2011, but someone once said that if you want to make God laugh, tell him your plans.
I also didn’t predict that I’d be on Facebook, and I don’t believe Google+ existed when this blog began. The former has been more satisfying than the latter, largely because Facebook has allowed me to reconnect with people I’d lost track of, in one case, from middle school. (That, I should point out, includes the one Facebook Friend I deFriended, and the one Facebook Friend who deFriended me. The latter was because my political views angered him for the last time; the first was because he was as much of an idiot on Facebook — unless you think a 45-year-old fan of “The Jersey Shore” is not incredibly strange, that is — as he was in high school. C’est la vie.)
This is an opinion blog, which means readers get opinions here every day, whether about federal or state politics, American or Wisconsin business, food and drink (I’m in favor of both), motor vehicles, the media, music, sports (particularly the Packers and Badgers), and whatever else comes to my mind. As I’ve written before, after the best thing someone can tell a reader — something like “I enjoy your work and I agree with you” — the second best thing someone can tell a writer is something along the line of “I read your stuff, and you are absolutely wrong.” (I’m getting a lot of that recently; can’t imagine why.) The worst thing someone can tell a writer is something like “You write? I’ve never read your stuff.” My blog software tells me that people are reading this blog, whether they agree with what I write or not.
I continue to be what (at least) two people have called me: a “media ho’.” I occasionally appear on WTMJ-TV’s “Sunday Insight with Charlie Sykes” …
… and Wisconsin Public Radio’s Friday Week in Review, and, twicethis month, WTDY in Madison. That is the logical result of never saying no to a media invitation, I guess. This is also a personal blog, so readers have gotten to read (or, if you like, have had to endure) the unusual facets of my past in small-town newspapers (including my biggest story), radio and sports announcing.
I’m pretty sure the largest number of blog entries this year (other than the daily “Presty the DJ” pieces) involved state politics. We endured several state Senate recalls (all but two of which were unsuccessful) because of the efforts of Gov. Scott Walker and Republicans to undo the disaster area that was state finance under the Doyle (mis)administration and the 2009–10 Legislature. The 15 percent of state workers who work for government had a different opinion, as Christian Schneider notes:
The year began with an appeal for more civility in politics, in the wake of the shooting of Arizona Democratic Congresswoman Gabrielle Giffords. Yet when the Capitol explosion began in mid-February, Walker and legislators of both parties started receiving death threats. State Sen. Spencer Coggs called Walker’s plan “legalized slavery,” and state Sen. Lena Taylor (along with dozens of protesters) compared Walker to Adolf Hitler. A Democratic Assemblyman yelled “you’re fucking dead” to a Republican colleague on the chamber floor following debate on Walker’s plan. Protesters targeted Walker’s children on Facebook, and Republican Rep. Robin Vos was assaulted with a flying pilsner.
So shocking was Walker’s plan that President Barack Obama criticized the governor, deeming it an “assault” on unions. Yet if Walker was a first-time union assailant, Obama continues to be a serial offender — federal employees aren’t allowed to collectively bargain for wages and benefits. …
During the summer, unions spent over $20 million to unseat six Republican state senators who voted for Walker’s plan. This exposed exactly why it’s about the money. Government employees merely serve as conduits for taxpayer funds to work their way to the unions, who then spend money electing obeisant legislators to negotiate favorable contracts. Shockingly, lefty “good government” groups appear not to have a problem with this blatant purchase of favors.
It was a year that granted the definition of the word “democracy” a previously unimaginable elasticity. While bullhorns around the Capitol blared “this is what democracy looks like,” 14 Democratic state senators fled to Illinois to prevent democracy from occurring. Later, a single Dane County judge would overturn Walker’s law, which irony-deficient Assembly Minority Leader Peter Barca called “a huge win for democracy in Wisconsin.” The law would later be reinstated by an incredulous state Supreme Court. …
2011 was the year that public-sector bargaining became a fundamental human right, bestowed on the people of Wisconsin from the heavens. “We will not be denied our God-given right to join a real union,” thundered Marty Beil, head of the Wisconsin State Employees Union, in February.
Yet God apparently first appeared in Wisconsin in 1959, when Democratic Gov. Gaylord Nelson signed the nation’s first public-sector collective bargaining law. It was a shrewd political move — four years earlier, unions had financed 55% of unsuccessful Democrat William Proxmire’s gubernatorial campaign. The year before Nelson created the law, Democrats had a $10,000 deficit in their state account; four years later, that had turned into a $50,000 surplus. At the time, it looked a lot less like a divine right and more like a naked political favor. (God has yet to visit 24 other states, which either have limited or no public-sector collective bargaining at all.)
Public-sector unions want you to believe that they are synonymous with public-sector employees. They are not. No self-respecting professional teacher should want to have anything to do with teacher unions, the biggest blight upon our educational system. That’s my opinion, but that was also the opinion of the late Steve Jobs.
One should never expect the unvarnished truth during the political process, but unions and their apparatchiks took falsehoods to new depths during Recallarama. Unfortunately for unions, evidence contrasting their assertions existed online. Unfortunately for Democrats and unions and other lefties, the more than $40 million they spent succeeding in reducing the state Senate Republican margin from 19–14 to 17–16, or 16 Republicans, 16 Democrats and one RINO, Dale Schultz.
One should never expect ideological or philosophical consistency from human beings, so keep that in mind when you read tributes to the Occupy ______ types. Most of the same people falling all over themselves praising the protesters were singing quite a different tune when the tea party movement began in 2009. Other than the obvious ideological differences, the biggest difference between Occupy _____ and the tea party movement is that the tea party movement succeeded in electing its candidates in November 2010. Occupy _____ has not one single electoral win and not one single political accomplishment yet. That includes Red Fred Clark, who a majority of 14th Senate District voters foundwanting.
One should never expect politicians to do what they say they’re going to do immediately (or perhaps not at all), but Walker doesn’t deserve an A grade yet. The state’s business climate rankings are better than they were a year ago, but 24th, 25th, 38th and 40th, with a C grade, is not nearly good enough. Until Wisconsin gets consistent top five rankings, Wisconsin will continue to trail the nation in business creation and per capita personal income growth, Wisconsinites will continue to suffer from excessive unemployment and insufficient income, and state and local governments will continue to lack the kind of revenue that comes from a healthy economy.
Speaking of the economy, it is in “recovery,” if that’s what you want to call it. The brilliance of the Obama administration is demonstrated in the current national unemployment rate of 8.6 percent, after nearly three years of the stimulus that stimulus supporters guaranteed would reduce unemployment below 8 percent. Since everyone who was paying attention knew that one major argument for the stimulus was to trade job creation now for higher unemployment (during a theoretically recovered economy) later, you can safely conclude there will be no improvement in unemployment for the foreseeable future. The “jobless recovery” has been predicted for three decades; well, it’s here now, which means that the economy will not be noticeably better in consumer spending generally or purchasing of big-ticket items specifically.
As usually happens, a number of stories didn’t get the attention they should, as WND.com notes:
1. The true rate of unemployment and inflation and the real state of the U.S. economy, which is far worse than reported.
The figure was five times the 2010 gross domestic product of the United States and exceeded the estimated gross domestic product for the world by approximately $14.4 trillion, according to economist John Williams.
The difference between the $1.3 trillion “official” 2010 federal budget deficit numbers and the $5.3 trillion budget deficit is that the official budget deficit is calculated on a cash basis, where all tax receipts, including Social Security tax receipts, are used to pay government liabilities as they occur.
“The government cannot raise taxes high enough to bring the budget into balance,” Williams said. “You could tax 100 percent of everyone’s income and 100 percent of corporate profits and the U.S. government would still be showing a federal budget deficit on a GAAP accounting basis.”
What’s more, the seasonally-adjusted rate adjusted for long-term discouraged workers – who were defined out of official existence in 1994 – was more than 22 percent in November.
The Bureau of Labor Statistics broadest measure of unemployment, which includes the short-term discouraged and other marginally attached works, along with part-time workers who can’t find full-time employment is more than 15 percent.
Methodological shifts in government reporting also have depressed reported inflation. If inflation were calculated the way it was in 1990, the annual rate would be nearly 7 percent. …
7. The real impact on the U.S. economy of Obama’s $787 billion stimulus.
While the Recovery Act boosted the economy in the short term, the extra debt generated by the stimulus “crowds out” private investment and “will reduce output slightly in the long run – by between 0 and 0.2 percent after 2016.”
The Obama administration had promised that at the peak of spending, 3.5 million jobs would be produced. …
8. The harmful impact of unions on the American economy.
“The most fundamental fact about labor unions is that they do not create any wealth,” he said.
Sowell pointed to a bill the Obama administration is trying to push through Congress, called the “Employee Free Choice Act,” as the best example of “the utter cynicism of the unions and the politicians who do their bidding.”
“Employees’ free choice as to whether or not to join a union is precisely what that legislation would destroy,” he said. …
While private-sector workers, using secret-ballot elections, have increasingly voted against being represented by unions in secret-ballot elections, government unions continue to thrive as taxpayers “provide their free lunch.” …
In September, Teamsters union President James Hoffa, addressing a large Labor Day rally, brazenly proclaimed that labor unions – especially the huge government employee unions like the 3-million-member National Education Association and 2-million-member Service Employees International Union – provide the ground troops in the ongoing war to “fundamentally transform” America into a socialist utopia.
“President Obama, this is your army! We are ready to march! Let’s take these son-of-a-b*tches out and give America back to an America where we belong,” he shouted, referring to the tea party movement.
The Obama administration has been generously “funding” the union army since the inauguration, from the General Motors bailout, which blatantly favored union workers, to Obamacare, whose burdensome new regulations don’t apply to many unions thanks to special White House waivers. Obama’s early executive order required all federal agencies to accept construction bids only from contractors who agree to use union workers, and he packed the D.C. bureaucracy with union officials.
Thank heavens for the current state of sports in Wisconsin. The Brewers got into the National League Championship Series (a place I predict they will not revisit soon), the Badgers are playing in their second consecutive Rose Bowl Monday (for my prediction, see this space Monday morning), and the Packers are the number one seed in the NFC playoffs a season after their fourth Super Bowl win. (I’ll have more to write about their next Super Bowl opportunity in January.) For those of us who endured such football as in 1988 (the Packers were 4–12 and the Badgers were 1–10), this still has an air of unreality to it.
Other interesting (and better) things happened in 2011. Our family set a personal record by heading for the basement three times as the tornado sirens went off for a non-test. The first happened while our German/French (now Italian) foreign exchange student was here. My, uh, freer schedule allowed me to go on field trips with our kids, including a church camp.
On to the year to come. I predict that the current economy will not be enough to get a majority of voters to fire Obama and his toadies. (Even if I run.) Too many Americans are still enthralled with the promise of Obama, even though the performance is best noted by his failures, and even though his biggest accomplishment (if that’s what you want to call it), ObamaCare, is tremendously unpopular with voters. (Perhaps they’ll start noticing when their employers drop employee health insurance, which will begin happening this coming year.)
The second reason for my prediction is that the Republicans are not exactly blowing the socks off voters through the interminable presidential-candidate-selection process, are they? There is no way in hell I will vote for Obama, and nor should you, but I can’t say there is a single GOP candidate I support for any reason than the fact that that candidate is not Obama. The fact that other voters feel like I do will be shown by support for a third-party — maybe more than one, in fact — candidate for president, including possibly Republican-turned-Libertarian Gary Johnson, Republican-about-to-turn-Libertarian Ron Paul, and Donald Trump.
Democrats shouldn’t jump for joy, though, because Republicans will not only retain the House of Representatives, but they will win the Senate in November. The demographic realities of the 2012 and 2014 Senate races will mean that, if my prediction (Obama’s winning with less than 50 percent of the popular vote) is correct, the gridlock you see in Washington will continue for most of this decade. I hope you enjoy it.
By the end of 2012, Wisconsin Democrats and their comrades will discover that Recallarama part deux was bad strategy, because whatever money they spend on defeating Walker in a recall election (which will result in Walker’s winning, by the way) cannot be used for (1) the U.S. Senate election, featuring socialist U.S. Rep. Tammy Baldwin (D–Madison); (2) efforts to unseat freshman U.S. Reps. Sean Duffy (R–Ashland) and Reid Ribble (R–Sherwood); efforts to win back (3A) the state Senate and (3B) Assembly by recall or by the November election; and, oh, by the way, (4) Obama’s campaign in this supposedly swing state.
It would be nice if Democratic and Republican office-holders and candidates would engrave in their brains article 1, section 22 of the state Constitution, which I repeat here for those Wisconsinites ignorant of it:
The blessings of a free government can only be maintained by a firm adherence to justice, moderation, temperance, frugality and virtue, and by frequent recurrence to fundamental principles.
My longer-term prediction is that this scorched-earth politics of ours will be reality for the foreseeable future, both at the national and state levels. Politics today is a zero-sum game — one side wins, the other side loses. How do you get past that, particularly when one side seeks to steal from the other? (That is exactly what Occupy ______ wants to do, either because they believe that’s how to solve unsolvable income and wealth inequality, or because they’re thieves at heart.) The 2011 Legislature is the direct result of the 2009–10 Legislature and its abuses of taxpayers, and whenever Democrats regain control of the Legislature, they will stick it to Republicans and their allies however, whenever and wherever they can. That wasn’t how politics worked when I was a UW Political Science student, but it is now.
The way I always end That Was the Year That Was is with these words: May your 2012 be better than your 2011. That may seem to be a low standard. That may also not be possible.
Steve Prestegard.com: The Presteblog 
