Sunday, March 20, 2016

Act 10 "savings" Macivered, while economic damage not mentioned

I've noticed that Gov Walker has been running around the state (at taxpayer expense) claiming that 5 years after the passing of Act 10, it has saved $5 billion. I was trying to figure out where that number came from, so I hit the Google machine, and here's what I found out. The number was MacIvered by the WisGOP propoaganda machine.

As in the Maciver "news" service, a Bradley Foundation chop shop that has been a front for right-wing oligarchs in Wisconsin. They created an "analysis", and here's what they "discovered." Also note the framing of their statements.
The analysis found that Wisconsin saved $3.36 billion by requiring government employees contribute a reasonable amount to their own retirement. The analysis also estimates local units of governments saved an additional $404.8 million total by taking common sense steps like opening their employees' health insurance to competitive bidding. Milwaukee Public Schools saved $1.3 billion in long-term pension liabilities, and Neenah saved $97 million in long-term pension liabilities in addition to other savings.
There is a kernel of truth in this. Act 10 shifted a larger amounts of the costs to go from government (and the general taxpayer) to the workers (a smaller group of taxpayers). Now some might call that THEFT, but technically this is an overall reduction of taxpayer dollars spent for these benefits, and that part should be acknowledged. However, that doesn't answer the question of "Was this a good thing for Wisconsin's economy, and its communities?", an analysis that Walker and his fellow rightie rarely tend to bring up. This breakdown of our communities and cohesion is certainly something that can be felt throughout the state due to the scapegoating of public employees, and that reason alone will make some think Act 10 is still a horrible law (I'll get to the economic performance of the state in a bit).

I also want to discuss the next claims that MacIver make, because this is a common right-wing lie that needs to be countered at all turns.
Medford officials were able to make that cost-saving choice [of bidding on insurance] because of Act 10.

Similarly, the Appleton Area School District switched health insurance providers last October and local taxpayers will see up to $3 million in savings in the first year alone.
One problem with that statement. School districts could always bid out their health insurance providers, and did before 2011. Saying Act 10 is what allowed this is a flat-out lie.

What Act 10 did is allow the districts to shift that cost onto teachers, staff, and other workers at the school district, without giving those workers a say through their union on how much they would have to pay for those benefits. All Act 10's "tools" were really a power shift that funneled money out of the pockets of public employees, by keeping them from having input in how those benefits were distributed and paid for. That in itself is bad, but let's never forget that the state employee unions would have agreed to the financial concessions as a last-ditch effort to keep their collective bargaining rights for benfits (an offer Walker turned down, revealing Act 10 as the union bust it really was), so while it was a serious hit to workers, it was one they were willing to take with their backs up against the wall.

If those savings were used to raise pay or maintain and increase public services, then maybe some of the Act 10 acrimony could be considered worthwhile. And MacIver tries to slide that argument in its "analysis."
$5.24 billion in savings works out to $910 in savings for every man, woman and child in Wisconsin, or $2,291 for every household in Wisconsin. The DOT could build 2,912 more roundabouts. The savings could fund over 68,000 four-year degrees at UW-Madison, or install 42 separate Milwaukee-style streetcar systems throughout the entire state. Thankfully, however, Walker and the legislature have used the Act 10 savings to provide more than $2 billion in direct tax relief for Wisconsinites.
But here's the problem with that claim. THAT DIDN'T HAPPEN. And the reason it didn't happen is because Walker and WisGOP cut state aids over the same time period, preventing the possibility of these enhanced services from happening. That's what can't be emphasized enough, the money concessions that were taken from workers weren't reinvested back into public services, but instead blown on those $2 billion in tax cuts and other government spending was shifted to support GOP special interests like WEDC and voucher schools.

Let's look at the funding that was going to the UW System when Walker took over, and what those figures look like today (all budget numbers courtesy of the Wisconsin Legislative Fiscal Bureau).

UW System GPR funding, 2010-2017
2010-11 budget base doubled $2,299,026,600
2011-13 budget $2,095,251,600 (-$203.775 mil)
2013-15 budget $2,247,320,900 (-$51.706 mil vs. 10-11)
2015-17 budget $2,078,356,200 (-$220.670 mil vs. 10-11)
TOTAL CUT FROM 2010-11 BASE $476,150,900

And how much did MacIver claim the UW System "saved" with Act 10 on benefit costs? Just over $527 million. Factor in inflation over the last 5 years, and the UW actually has less state funding to pay for its operations than it did before Act 10 came into being. So UW got no fiscal benefit whatsoever from the reduced take-home pay that their employees got, and now are less competitive when it comes to keeping and attracting talent, reducing the quality of the state's education and work force. Fuck that.

The same pattern repeats with K-12 education funding, where the Act 10 "tools" may have saved some money, but that's little solace when schools are receiving less funding from the state, and not being able to improve services as a result.

K-12 public education funding from state- all state sources
2010-11 $5.325 billion
2011-12 $4.893 billion (-$431.6 million vs 2010-11)
2012-13 $4.964 billion (-$360.6 million vs '10-'11)
2013-14 $5.039 billion (-$285.8 million vs '10-'11)
2014-15 $5.242 billion (-$83.4 million vs '10-'11)
2015-16 $5.245 billion (-$80.5 million vs '10-'11)

Again, that figure is before inflation, making the real cut even higher, and so much for the "savings" MacIver claims schools got for their retirement savings (PS- "unfunded liability" is largely a bogus measure as it is, because all employees are not going to retire at once from a district). It is likely that many school districts at best have broken even despite the Act 10 measures, because they were offset by cuts in state aid.

But that's not all on K-12 funding, because while overall K-12 dollars are down, the amount of tax dollars going to voucher and charter schools has gone up at the same time. This is a result of the Walker/WisGOP crew taking its orders from ALEC and the MacIver-funding Bradley Foundation, and funneling money away from public schools.

Change in state GPR $ to voucher/charter schools
2011-13 budget +$43,683,500 vs 2010-11
2013-15 budget +$77,866,700 vs 2011-13
2015-17 budget +$79,665,100 vs 2013-15
TOTAL $201,216,300 above 2010-11

Maybe if public schools had more than $200 million put into them, instead of taken to the voucher schools, maybe we might have a chance of seeing those improved services that MacIver claims Act 10 allows for. Funny how that reality never comes up in their "analysis" of Walker/WisGOP policies. So now the cuts to public schools are up to $1.44 billion over the 5-year Age of Fitzwalkerstan.

The fact that Act 10 wasn't a cure-all for local schools' budget issues is common sense when you look around. If Act 10's tools have magically made Wisconsin's school districts solvent, why have so many of them needed to have referenda to raise property taxes just to keep the buildings from falling down and to keep the lights on? And why are schools like Madison cutting 50 staff and teachers and why is Oshkosh facing the prospect of closing a middle school and cutting $3.4 million 5 years later?

I'm not even bringing up the cuts in state shared revenues to municipalities, which also meant that the "savings" MacIver props to those counties, cities, villages and towns never had a chance to be realized into better opportunities and services at that level. It helps explain why the U.S. DOT says Wisconsin has the 3rd-worst roads in the country, and why numerous state legislators from both sides of the aisle were asking for the chance to raise sales taxes to pay for needed repairs (a request turned down by the ALEC-owned state Legislature, meaning at least another year of deterioration).

Then add in the worst job growth in the Midwest in the years since Act 10, and I don't care how much money MacIver claims Act10 saved, there is no way an honest person can say these anti-worker, austerity policies in the Age of Fitzwalkerstan can be considered successful for anyone. Well, anyone except the politically-connected few who have seen resources sent their way instead of the Wisconsin communities and workers that used to make this a great state to live in. And shifting money and power to their political allies and campaign contributors has always been the only priority of Scott Walker and the Wrecking Crew, and they don't care that they have set Wisconsin back decades in the process.

Had enough of this? It only stops when we make them stop, through the ballot box, or other means.


  1. (I'll get to the economic performance of the state in a bit).
    Heck, you've been doing that every week and I thank you for it.
    Vos was the in the STATE JOURNAL today trying to crow to the editorial board about the State's economy. I decided to save my teeth enamel rather than grind my teeth as I read the Q&A.
    Both he and Fitzgerald have recently been laying groundwork to try and say what a great job they have done.

    1. Thanks for the kindness, and for rightfully predicting the BS this crew will try to slip over in the coming months. We gotta be there to call out the BS and make the media have to react

  2. Ive made this very point many times going all the way back to my 2012 primary race for 25th Assembly. All those "savings" didnt save Joe Taxpayer a bloody penny! It was all trucked off to special interests which to a large extent out of state investors.
    Meanwhile my primary Opponent, a local Faux Democrat and city alderman kept saying that "Act 10 was good for the City of Manitowoc." He lost by over 4000 votes to the actual Republican.

    1. Yep, it's amazing how many don't see the shell game that is going on. And now there's no money left to fill in the holes, with taxes being cut, no real job growth, and the one-time bullet of Act 10 being used up.