Wisconsin's increasing reliance on context-free politics and spending cuts -- enjoy your mostly imaginary tax break, though. | WisCommunity

Wisconsin's increasing reliance on context-free politics and spending cuts -- enjoy your mostly imaginary tax break, though.

Scott Walker is out there yet again, with a new ad plying the airwaves. And today comes Politifact Wisconsin to judge whether the ad is truthful. 

Walker's ad claims that his income tax cuts and property tax relief, signed into law by the Republican-dominated legislature, will result in savings of $322 for an "average family." That's for the 2014 tax-filing year.

Politifact asked Walker aides to back up the figure and was largely satiisfied with the response (you can read the whole column by clicking on the link below). Politifact gave Walker a "mostly true" rather than a "true" based on certain missing information. 

The Walker claim, Politifact said, is based on an "average family" defined as four people with a median household income of $81,000. How many families do you know making that much every year? Is that an "average" Wisconsin family? Yes, according to Politifact: "U.S. Census figures show that a family of four in Wisconsin has a median income of that amount, or slightly higher. A family of four is a common measuring stick. About one in five family households in Wisconsin is that size." Ah, well, maybe 20 percent of us are going to get that $322 tax break, then.

But Politifact went on to note that two-person families are much more common in the state, along with three-person households. And, said Politifact, the median income across all family sizes in the state was much lower -- $65,618. That, Politifact said, is arguably a more representative "average family" income.

Okay. So far, so good. But there's a lot more missing yet contextually important information than that regarding this supposedly swell gift from Walker. And in light of that information, his ad actually looks even less truthful.

For example, prior analysis has suggested that Walker's wider range of economically impactful moves -- especially his union-busting law for most public employees -- would drive down buying power and thus consumer spending across the state by as much as $3 billion. Walker's anti-union law imposed serious fiscal constraints on public employees, based on his ideological but inaccurate argument that public sector workers were impeding the state’s economic performance.

Well, he "fixed" that imaginary problem, and here we are, dealing with the negative side effects. That $3 billion is the calculated, multiplier-effect result of Walker's fiscal decisions on the statewide economy, where public employees already earned less than their private-sector counterparts, in many cases. Now, with Walker's further stinginess, those workers are forced to trim their spending and in some cases they even qualify to apply for food stamps. Thei smaller wallets hit state merchants and service providers, too. 

Wisconsin is way behind the (that word again) average performance of all states in private-sector job creation, and lags many states on the basis of per capita income, too, receding from our formerly competitive position against places like neighboring Minnesota.

Indeed, when bean counters say that during Walker's tenure the state has added around 100,000 jobs -- well less than half of what Walker promised thanks to his "bold" policies -- they neglect to figure in the net loss in Wisconsin's total number of public-sector jobs.That loss is highly unusual, compared to many other states, where public employment is growing again now that the Great Recession has eased financial burdens on governments. According to a dispatch last March:

Wisconsin has its leanest public sector in nearly 20 years, according to new figures from the U.S. Census Bureau.

An  of the recently-released Census Bureau data shows that Wisconsin had 5.4 percent fewer state and local government employees per capita in 2011 than the national average, ranking 40th among the states. State and local employees include a wide variety of workers, including teachers, highway workers, corrections guards, firefighters, and police officers.

Only 10 other states had a leaner public sector than Wisconsin in 2011. While that might surprise some state residents, Wisconsin has had fewer state and local employees per capita than the national average for most of the last two decades.  Wisconsin had 49.6 state and local full-time equivalent positions (FTEs) per 1,000 residents in 2011, compared to a national average of 52.5 FTE ... .

In a later report, the Budget Project also noted that public employees in Wisconsin earn less than the national average. Public employees earn an average of $3,174 a month in Wisconsin, compared to $3,689 a month nationally. Over the course of a year, that difference means that Wisconsin public sector employees earn an average of $6,200 less than the national average. "Part of the reason that Wisconsin public sector employees earn less is that they are more likely to work part-time than in other states, but even the full-time employees in Wisconsin earn slightly less than their full-time equivalents in other states."

And, there are fewer of those workers among us. Indeed, in just the first three months of 2012, a federal census showed a huge drop of 9,364 public-sector jobs in Wisconsin. An increasing number of those departees, fed up with working conditions and declining compensation, retired early or left for greener pastures. Other positions were eliminated. And when those people couldn't find other jobs and applied for unemployment compensation, the benefits ran out too early for many of them. Others simply retired early.

But those public workers weren't really the drain on the state's economy that Walker pretended.In fact they were a key component of our once-healthy economy. But in recent years, beginning even before Walker's term and accelerating thereafter, a Wisconsin household with one breadwinner who's a public employee earning the average public employee salary listed earlier wouldn't come close to the state's overall "average family" income, or gain all if any of the tax relief cited by Walker. Beyond policies that have significantly cut public employment, Walker's made things worse by forcing compensation claw-backs on remaining public employees ranging on up to 18 percent.

But it gets even worse. Because by cutting state support for public education, Walker basically forced localities and local governments across the state to come up with new revenues or make further cuts in their own budgets. And often those cuts have been in salaries and benefits or further reductions in staffing and program levels. Included is an increasing move toward part-time employment, which often lacks basic benefits and offers lower pay. And then of course there's inflation, which, combined with lagging salaries, has resulted in an 8 percent decline in the average worker's buying power since 2000, on top of stagnant or declining compensation. 

Beyond that, Walker's borrowed more heavily, and the state still faces a multi-billion-dollar deficit projection by the time Walker has to produce his next budget, if he's still governor. So will you be able to have a fling on that $322 claimed "savings"? More likely, even if you get that full amount, you'll need it and more to more fully pay your increasing expenses, like housing, utilities, food and gas. But most Wisconsin residents won't get that $322. Indeed, they'll only approach that level of savings if they own a house and have two full-time working adults, and that's no guarantee. Besides, fewer state residents can afford to buy and maintain a home, now, and no property tax break will help them. Many still labor under Walker's reductions in the Earned Income Tax Credit for low-wage workers.

And beyond even that, Walker's preference toward government deconstruction means you get less services. Maybe you can live without some of them, but if fewer road repairs mean you end up needing an axle job after hitting a pothole, that's a hidden cost of Walker's "savings." So be sure not to spend that $322 all in one place this year, even if you are among the small percentage of state residents who actually get that much.

There's your fuller context. You're welcome. Sort of. 


September 28, 2014 - 12:31pm