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May 14, 2008

Wednesday Update


Wisconsin Club for Growth 

May 14, 2008
Volume 2, Number 21

The Wednesday Update 

In This Issue

1. The Doyle Years
    Prove Costly

2. Bad Budget Made
    Worse


3. Dr. Millionaires 
    Meaningless Gesture


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The Doyle Years Prove Costly


Five years ago, Governor Jim Doyle promised to eliminate an immediate budget shortfall of over $400 million (and a structural deficit of $3.2 billion), by cutting spending, eliminating 10,000 taxpayer funded jobs, making government more efficient, and putting an end to borrowing against our future.

Today, Wisconsin faces an immediate budget shortfall of over $500 million and an ongoing structural deficit of 1.7 billion more.  So what happened? Are high gas prices and an otherwise sluggish national economy to blame for the perpetuation of Wisconsin's budget woes, despite the Governor's best efforts?  Or has the Doyle Administration's reckless, incompetent and unethical management of state government caused the budget mess we have today?

We thought it might be useful to examine excerpts from Doyle's 2003 State of the State Address, and use the Governors own yardstick to measure his rhetoric against the brutal reality of Wisconsin's current budget fiasco.

"Now it is time for us to lead. To say we should cut spending thoroughly is not to say we should do so thoughtlessly."

In 2003 Governor Doyle promised to eliminate 10,000 state jobs.  The 2003-2005 state budget only reduced the total number of state jobs from 68,091 to 66,719. Doyle's most recent state budget included funding for 68,085 state employees. So basically he's cut seven jobs in 5 years.

"And we will review every program to ensure it still makes sense -- not just its proposed increase, but the base level of funding too."

Not only has Doyle failed to eliminate any agencies, programs, boards or commissions, he has created new agencies and expensive new programs like the Wisconsin Covenant and Badger Care Plus programs for which there are no stable or permanent funding sources.

"Ultimately, what we owe our citizens is a government we can afford -- and a government that works. We can make state government more efficient, and we should."

Doyle's promise to save the state hundreds of millions by streamlining state contracts, selling state property and upgrading information technology never materialized.  In fact, according to the Wisconsin State Journal, "The state has spent more than $190 million in state and federal money on computer projects that have either had to be scrapped or vastly exceeded their budgets."

The state spent nearly $80 million alone on three now abandoned projects and one project exceeded its highest cost estimate by 29%,

"Going forward, my mind will be open to every solution -- except one. We should not -- we must not -- and I will not -- raise taxes."


Apparently he wasn't counting property taxes, real estate sales, tobacco taxes, internet sales taxes, gas taxes, hospital taxes and a bevy of other "user fees."

"Wisconsin is already one of the nation's most heavily taxed states. Adding to the burden would make it virtually impossible to attract new jobs while destroying more than 50,000 of the ones we already have."

Doyle's words proved to be prophetic.  Last year the number of good paying manufacturing jobs fell to its lowest level in 17 years.  Adding to Wisconsin's woes this year, Miller Brewing announced that it is likely to move its corporate headquarters out of Milwaukee and General Motors will lay off 750 people from its plant in Janesville. 

"Finally, let's solve this problem once -- and let's solve it right.
For too long, Wisconsin has budgeted for today without thinking about tomorrow. We've allowed structural problems to accumulate that make each budget more difficult than the one before. In the past, government resorted to easy, cosmetic fixes rather than making the tough calls."


We doubt even Governor Doyle is cynical enough to suggest that "solving it right" means stealing hundreds of millions from the transportation fund with his veto pen in order to increase education spending, while at the same time borrowing hundreds of millions more to fund road projects, but that's exactly what Doyle did.

The Wisconsin Policy Research Institute reported, "By the end of the 2007-09 budgets, Wisconsin taxpayers will have had to pay $332 million in interest on the bonds used to replenish the transportation fund.  When these replacement bonds are retired, they will have cost taxpayers an extra $1.1 billion in debt service."

"And we can restore integrity to state government."

We're still waiting.  Meanwhile Wisconsin taxpayers continue to pick up the tab for reckless agency spending, and investigations and legal settlements involving tainted contracting and hiring, botched computer projects and faulty budget and revenue projections.  The state was just ordered to pay $346,000 because a top Doyle official passed up two qualified state employees for a less qualified candidate with political connections.

Governor Doyle's five year tenure has been marked by incompetence, mismanagement and corruption that have proven extremely costly for Wisconsin taxpayers.  If Doyle had lived up to even half of his promises, the state would be in much better fiscal shape today.
 
 

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A Bad Budget Made Worse

While Governor Doyle was off in Europe slugging pints of Guinness and negotiating environmental accords with the British government, state legislative leaders battled the half billion dollar budget hole, one largely resulting from Doyle's own irresponsible and incompetent administration.

The budget fix agreed to by the Democrat State Senate and the narrow Republican Majority in the State Assembly is not something to celebrate, but considering the proposals offered by Doyle and the State Senate, it certainly could have been much worse.

Assembly Republicans again fought back Doyle's $416 million hospital tax, along with the Senate Democrat's plan for a $130 million tax on multi-state corporations, and a 650% car rental tax increase to fund KRM commuter rail, as well as negotiating a smaller raid on the transportation fund than the $293 million Doyle proposed.

The following are lowlights of the plan that passed the State Senate yesterday by a 17-16 vote.

• Lapses $69 million from unencumbered balances

• Raids $50 million from Transportation Fund and replaces it
  with bonding

• Prohibits $21 million appropriation to implement federally
  mandated Real ID Act

• Creates $28 million Transportation Fund deficit to be
  replaced with bonds

• Delays $125 million school aid payments

• Takes $57 million from the state's "Rainy Day Fund"

• Changes the Tobacco Securitization Funds to capture $209
  million

• Increases the non-resident snowmobile trail use sticker from
  $18 to $35

• Creates a $15 million tax increase by eliminating a tax
  deduction for rental payments and interest payments for
  some corporations

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Dr. Millionaires Meaningless Gesture

In a bold gesture of self-sacrifice, Congressman Steve Kagan, the millionaire Doctor from Appleton has said he won't enroll in the federally funded health care plan available to members of Congress until the same coverage is made available to all of his constituents.

"I have no health conditions and am pretty darn healthy." And if he gets sick? "Id be just like the 47 [million] to 50 million American citizens who don't have coverage," he says, "and I'd have to negotiate with hospitals and doctors for the best-priced coverage."

Of course Dr. Kagan is just like everyone else, except really rich, medically knowledgeable and well connected.  It means so much that the same millionaire Doctor who refused to treat Medicaid and Medicare patients because the government didn't pay him enough, is now refusing the House health care plan.  If Dr. Kagan should find himself in need of expensive care during his average Joe phase, perhaps his children will be willing to help him with his bills.

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