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November 26, 2008

The Wednesday Update

November 26, 2008   Volume 2, Number 48   In This Issue: So Many Special Interests, So Little Revenue

November 26, 2008 Volume 2, Number 48	Wednesday Update
In This Issue: 1. So Many Special     Interests 2. Doyle: I Feel My Pain 3. Send Us Your Tired	So Many Special Interests, So Little Revenue No matter how ridiculous your opinion happens to be, if that opinion is shared by the Milwaukee Journal Sentinel editorial board, they will find you and ask you to write a column for the Sunday paper.  A case in point is an editorial that appeared this weekend, in which three liberals put their tin-foil covered heads together to conclude that Wisconsin taxes just aren’t high enough. With the state facing a $5.4 billion deficit, Dennis Collier, Jack Norman and Jon Peacock explain what the Milwaukee Journal Sentinel has said all along, the problem is not that government spends too much, but that it taxes us too little.  The tax happy trio attempt to convince readers that taxes in Wisconsin aren’t really that high since the state’s fees are relatively low.  Consequently, they lay out a laundry list of increased taxes to keep us from "deteriorating" any further. (Or at least enable school districts like MPS to buy more iPods for their students.) The cornerstone of their plan is a 20% increase in the state sales tax, from 5% to 6%.  Of course, the sales tax is our most regressive tax, hitting lower income families the hardest.  Apparently helping the poor means taking more money from them. Raising the sales tax from 5% to 6% may not be enough to devastate our economy, so they advocate extending the sales taxes to a variety of services that are currently exempt.  Naturally, that would increase the cost of each of these services for consumers and small businesses alike. Under this scenario, Wisconsin will lose even more jobs (and revenue) as companies continue moving to more tax friendly states. Next, the three amigos then set their sights on “the wealthy” and senior citizens, raising the highest income tax bracket by 14.8% and raising income taxes on social security benefits for seniors making over $32,000.  Just to be sure that no Wisconsin business is permitted to thrive, they further advocate raising corporate income taxes and requiring businesses to pay taxes on income earned in other states. Ah, but think of that nostalgic feeling you'll get when you once again see billboards at our borders asking the last business leaving Wisconsin to please turn out the lights.   Doyle to State Employees: "I Feel My Pain" This week, Governor Doyle announced he would suspend discretionary pay increases and bonuses for over 1,500 state employees to help balance the state budget.  In his announcement, he explained how much he struggled with the decision. "Frankly, it really pains me to do this because this is one way that you do recognize and reward people who go above and beyond," Doyle said.  "There are many people in state government who are working long hours on very difficult projects and that's the purpose for these kinds of bonuses, to recognize that." Of course, taxpayers should be asking: why does anyone in the famously incompetent Doyle administration think they actually deserve a bonus?  Governor Doyle and his team have dug the state into an impressive $5.4 billion budget hole with no rope left to climb back out.  The Doyle deficit means state taxpayers will be forced pay more for gas, food and health care to cover his budget mismanagement and lack of leadership.  Doyle argues the state deficit is a result of a failing national economy, but the record tells a very different story.  Doyle has created large deficits that have come home to roost after years of raiding segregated funds, one time budgeting gimmicks and chronically underbudgeting his expensive new programs and intiatives.  Team Doyle has wasted millions on computer projects that have never materialized, exposed the social security numbers of thousands of state taxpayers, grossly under-estimated the cost of implementing the BadgerCare Plus health care program, failed to implement a legally required state voter file, and provoked a costly legal challenge from the State Medical Society for continually raiding the patient compensation fund.  The state Railroad Commissioner recently complained that a 10% cut to his already worthless department would reduce it to a “dog and pony show.”  Does that sound like an administration that deserves a bonus? There are hard working people in the private sector who will be lucky to just hang on to their jobs in the upcoming year.  Doyle might want to consider feeling the “pain” of those who have lost their jobs instead of wringing his hands over bonuses for government employees whose job security doesn’t depend on their performance, or even on the health of the state economy. Send Us your Tired, Your Welfare Recepients For nearly two years, business and taxpayer groups have warned that the proposed $15.2 billion government-run Healthy Wisconsin plan would attract the uninsured, non-workers and even illegal immigrants from all over the nation, with Wisconsin taxpayers picking up the tab. There is a historical basis for their concern. Most of us recall the late 1980’s and early 1990s, when Illinois welfare administrators put welfare recipients on buses with a one way ticket to Milwaukee – reducing costs to their taxpayers while providing recipients with Wisconsin’s more generous benefits. Well, it turns out that even after substantial welfare reforms in the mid ‘90s, excessive welfare benefits are continuing to draw people across the border. According to a Princeton University report issued in September: Wisconsin had one of the five worst migration patterns in the United States from 2000 to 2006. Higher income individuals left Wisconsin. Individuals on the lowest rung of the economic ladder migrated to Wisconsin. The Princeton report concludes, "Wisconsin is more attractive to low income individuals than high wage earners." And yet during the upcoming budget, you will hear agency heads rail on about how the state budget is already cut to the bone.  In order to turn the economy around, they'll argue we will need to tax more. That'll be great for the economy of Illinois. We can send them our wage earners in return for their welfare recipients.  Sound like a fair trade?