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Sunday, March 13, 2011
Put Blame Where It Belongs by Kim Tschudy
In recent weeks there has been much coverage of what is taking place at the State Capitol and for good reason. First a disclaimer, I am a state employee and have been for 26 years. I am also a non-union state employee because of my job title.
Much has been made of Wisconsin, "being broke" and having a $150 million hole in the current 2009-11 biennium which ends on June 30, 2011. The story that hasn't been told is that before contract negotiations broke off the state employees union had already consented to a $100 million concession on wages and benefits leaving a $50 million dollar hole to be filled. I ask, is it fair to balance 66 2/3% of the budget hole on the backs of 66,000 employees and leaving the remaining $50 million to be covered by the other 5.6 million state residents?
The annual percentage of the total state budget that goes for employee compensation is 10% of the entire state budget. We are not the budget breakers. The great recession, banking crisis, housing crisis, and high unemployment was not caused by teachers and other public employees. It was caused by the banksters, Wall Street, greedy hedge fund operators and greedy insurance companies that paid their executives billions of dollars despite the worsening economy that they brought on the country.
It's became quite popular to blame public employees for everything that is going wrong. But lets place the blame where it needs to be. We need to take a look at Wisconsin government for past 30 years to get a clearer view of what actually took place.
The following chart shows what actually happened.
1979- Democrat Gov. Schreiber leaves office in 1979 leaving a $3 billion surplus.
1983 Republican Governor Dreyfus leaves office having given back the $3 billion, declared a tax holiday, then mandated 5 unpaid days off for state employees and left the incoming governor with a $500 million debt.
1987 Democrat Gov. Tony Earl leaves office having paid off the $500 million debt he inherited from Republican Governor Dreyfus. Tony Earl had to raise the sales tax 1 cent to pay off the state debt.
1987 Republican Tommy Thompson enters office with a "$32-$38 rainy day fund" he inherited from Governor Tony Earl.
2001 Tommy Thompson turns over the seat to Republican Lt. Governor Scott McCallum and saddles him with a huge state debt of $3 billion. During McCallum's 18 months as governor he has to sell the Wisconsin Tobacco Settlement (a structured agreement) for far less that it's total value to try and clean up the mess Thompson left him.
2003 Democrat Jim Doyle takes office (I never voted for Doyle for Governor) saddled with a $3 billion debt left by Republican Tommy Thompson. It isn't fair to hang this one on McCallum. Doyle made a campaign promise that he wouldn't raise taxes. Not a smart thing to do. Doyle did manage to cut the state debt a bit during his tenure.
What is especially interesting is in 2002 Republican State Senator Mike Ellis (a generally pragmatic person) teamed up with Democrat State Senator Bob Jauch and both decried the mess that Tommy Thompson created with the structural deficit he kept adding to.
The point here is we need to put the blame where it belongs, tax cuts don't help the economy grow. Currently, tax rates in the United States are at a 50 year low and we still feel like we are in a severe recession. We need to ask ourselves just how well the tax cuts over the past 10 years have worked along with the big tax cuts of the Reagan years. Each time a Republican president has made substantial tax cuts the economy has fallen into the toilet. While I'm no admirer of Jim Doyle he probably would have been able to leave the state in better financial condition had he not had to deal with falling tax revenues from the severe recession his last 2-3 years in office.
In my work for the state I deal on a regular basis with the union and while in theory we're on opposite sides, the union is often our best resource for help when we deal with employee disciplinary problems. Yes we can argue across the table but in the end we both want the same thing, to change the behavior of the employee who is in trouble. Often times it is through our working with the union that we can get the help for a troubled employee. That's called success.
And don't for one minute ever believe that a state employee can't be terminated. They can be terminated and often are. It takes time to do but it is much less costly to the taxpayers (which all state employees are, we're just like you when it comes to paying taxes) to do it correctly and then not have to face lawsuits for inappropriate termination.
What is equally as disturbing in the new budget is the power shift to the governor. There is absolutely no good that can come from this type of power shift where a governor gets the authority to sell state assets as he deems necessary and can do it without a bid if he so chooses. To be granted the power to sell off state assets with little to no oversight and bust the union which isn't the problem is a rape of the taxpayers of Wisconsin.
Any short-term gain garnered from selling the state power and heating plants to private companies will come back and bite us in the rear end pretty darn quickly when the state no longer has any control over how much they will be charged for electricity that we currently produce. And you can bet that once the first contract for providing power or heat expires the succeeding contracts will be much more expensive than public employees could have provided the same services. All we need to do is look at some of the towns where their local utilities have joined Wisconsin Public Power Institute. About 18 months ago Bellvue, Iowa joined WPPI and their rates in some cases went up 25- 65% in one month. Once those assets are sold off the State of Wisconsin will never have the money to replace them.
In the end this whole budget situation has been contrived by Scott Walker to further his personal political agenda of union busting and pitting one group of people against another in order to hide his true agenda, looking out for his plantationist pals who will toss Walker under the bus the minute he has no value for them.