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August 05, 2009

The Wednesday Update

August 5, 2009  Volume 3, Number 30   IN THIS ISSUE:  The Great Train Robbery; Milwaukee Firm Railroaded
Wisconsin club For Growth

August 5, 2009
Vol. 3, Number 30

Wednesday Update

In This Issue:


1. The Great Train
    Robbery

2. Milwaukee Firm 
    Railroaded

3. Unsustainable Spain

4. Unelected Boards

 

 

The Great Train Robbery


Shortly after he introduced his disastrous state budget, Governor Jim Doyle left for a trade mission to Spain. As noted in previous Club for Growth updates, Doyle has a history of fleeing the country to avoid bad press.

The Governor and his top aides were lured overseas by the Spanish government that was kind enough to pay for their trip. In exchange, Doyle agreed to give a no bid contract to Spanish train manufacturer, Talgo. Doyle recently touted the $47.5 million purchase of Talgo assembly sets as a way to create 80 jobs at a cost of nearly $600,000 each, not including interest on the money borrowed from future generations. Both Governor Doyle and State Senator Judy Robson have hyped train building as an opportunity to utilize the defunct GM Janesville plant.

Thanks to Governor Doyle, over-taxed Wisconsinites are now spending their hard earned money to help bail out Spain's distressed economy, an economy that is distressed in large part because it is far too reliant on government subsidized jobs.

Milwaukee Firm Railroaded

Last week, Milwaukee area officials made a desperate plea to allow Super Steel in Milwaukee to assemble the train sets purchased by the state from Talgo. Super Steel, founded in Milwaukee in 1923, is a leading manufacturing and assembly operation for commuter and freight rail systems in the United States.

The same day, talk radio show host Mark Belling reported that Super Steel was in jeopardy of losing its biggest contract for assembly work with the train manufacturer Nippon Shayro, because the firm was furious that it was not allowed to bid on the project Doyle awarded to Talgo on a no-bid basis.

A recent article posted on Spainbusiness.com tells the story:

Wisconsin Department of Transportation Secretary, Frank Busalacchi recently noted that this is only the beginning of a long partnership that could apply to many other corridors in the United States.

Truth be told, Mr. Busalacchi has been doing the Talgo Tango for quite some time. In fact, Doyle’s Transportation Secretary headlined a live webinar entitled, Speeding Forward with Talgo President Antonio Pérez and Spanish Trade Commissioner, José Luis Briceño. Simply put: the no bid contract awarded after Doyle’s Spanish holiday was the consummation of long-term love affair with the Spanish train maker.

Despite a February 18th email from the Department of Transportation saying the state would use a competitive bidding process for the train purchase, Super Steel’s client and two other companies who asked for an opportunity to bid on the project, never stood a chance.

Unsustainable Spain

In addition to the fear that billions of dollars in federal stimulus money may otherwise burn a hole in Governor Doyle’s pocket, one of the main justifications for building more rail lines in Wisconsin is the creation of so-called “green” jobs. Rail construction will put people to work and get people out of their automobiles and onto more “eco-conscious” rail cars, or so the story goes.


Yet a closer look at the Spanish model dispels the myth of the green economy.

Once touted as the fastest rising economy in the world, Spain is now struggling to recover from the economic downturn, largely due to its over-reliance on subsidized “green jobs.” So when Jim Doyle and his liberal allies try to accuse you of being anti-jobs for opposing the next big government boondoggle, be it increasing ethanol mandates or purchasing expensive new trains that nobody wants, remind them that trading existing, long- term, private sector jobs for taxpayer subsidized green jobs will sink Wisconsin’s economy faster than all of Jim’s Doyles other bad economic policies combined.

According to a study from the Universidad Rey Juan Carlos in Spain, the “green jobs” movement isn’t working for Spain and it won’t work for Wisconsin:

Therefore, while it is not possible to directly translate Spain’s experience with exactitude to claim that the U.S. could lose at least 6.6 million to 11 million jobs, as a direct consequence were it to actually create 3 to 5 million “green jobs” as promised (in addition to the jobs lost due to the opportunity cost of private capital employed in renewable energy), the study clearly reveals a tendency that means the U.S. should expect such an outcome.

 
Further, the study warns:

This study is important for several reasons. First is that the Spanish experience is considered a leading example to be followed by many policy advocates and politicians. This study marks the very first time a critical analysis of the actual performance and impact has been made. Most important, it demonstrates that the Spanish/EU-style “green jobs” agenda now being promoted in the U.S. in fact destroys jobs, detailing this in terms of jobs destroyed per job created and the net destruction per installed MW. The study’s results demonstrate how such “green jobs” policy clearly hinders Spain’s way out of the current economic crisis, even while U.S. politicians insist that rushing into such a scheme will ease their own emergence from the turmoil.

So in his zeal to replicate a floundering Spanish economy, Governor Doyle is wrapping another millstone around Wisconsin's neck.

Unelected Boards - The Final Insult

The next phase of Doyle and Company’s brave new world will be to abdicate power to unelected boards, allowing for more, graft, corruption and mismanagement.

Many of the proposed new rail systems will be run by unelected boards, with the ability to impose taxes on citizens without their approval. Two such taxing boards are described by articles in the recent “WI Magazine,” with Deb Jordahl taking on the issue of unelected RTAs (Regional Transit Authorities) and Mike Nichols exposing the dysfunctional inner workings of the Milwaukee Area Technical College (MATC) Board.

Jordahl writes:

Enter the regional transit authorities the Democrats slipped into the state budget. These unelected boards will be empowered to raise taxes, issue debt and even seize private property. At the same time, RTA members have been completely insulated from an angry electorate. You can’t throw these bums out, because you didn’t hire them! Proponents say Regional Transit Authorities (RTAs) give local governments a mechanism for replacing declining federal and state aid without increasing property taxes. What’s more, they say, RTAs allow regions to invest in long-term improvements to the transportation infrastructure.

 
Further, Nichols points out:

The board has raised MATC’s property tax levy 57% since 2001, and tax rates were already far higher than in most other districts. Indeed they were 66% higher than in the neighboring Waukesha County Technical Institute district. That translated to hundreds of dollars in extra taxes for many MATC taxpayers—enough, in the weeks prior to that September board meeting, to prompt some residents to try to secede.

 
In both cases, we’re stuck with enormous tax increases and no opportunity for public input. It’s just the newest way liberals railroad the public into forking over more of their money.



 


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