Tuesday, July 12, 2016

Walker still ignores reality on how invest in, create jobs

Interesting article in the Capital Times today, which follows up on last month’s decision by the Wisconsin GOP members of the Joint Finance Commmittee to move $8 million from the Wisconsin Economic Development Corporation’s [WEDC] fund for start-ups, and instead use it for giveaways incentives to existing companies (I discussed that action in this post).

In the article, author Erik Lorenzsonn talked to entrepreneurs and academics in addition to WEDC officials to give a wider view of the issue, and he found that actual job creators say they don’t need tax credits to grow. Instead, they’d rather have policies that grow human and physical capital.
Max Lynch is the co-founder of Ionic Framework, a Madison startup that's created a mobile developer platform. He says that for his own company, the shifting of tax credits really doesn't matter — such incentives have been irrelevant to Ionic. He believes there are other actions the state could take that would be more effective at nurturing the entrepreneurial environment.

"We as a company want to see more tax money going into public infrastructure and the university," he said. "We want smart people to come work for us."

University of Wisconsin economist Steve Deller said that research by and large supports the idea that tax credits aren't great tools for promoting growth.

"People aren't really that susceptive to small changes in tax code," he said. "Businesses are the exact same way. If they're offered a tax break, it won't change things all that much."
And you’re even starting to see versions of these statements coming out of the mouths of the audience at Gov Scott Walker’s hand-picked “listening sessions.” Take a look at what’s buried at the end of this report on Scotty’s trip to the Eau Claire area yesterday.
Throughout his speech, Walker portrayed the shortage of talented workers to fill available jobs as the No. 1 challenge facing Wisconsin….

Among the diverse topics raised by participants in Altoona were UW System funding, the worker shortage, schools, technology, broadband, roads, water quality, the state’s wolf population and government efficiency, said [Eau Claire Area Chamber of Commerce president Bob] McCoy, who noted the link between education funding and the skills gap.

“If you don’t have a good educational system, you don’t have a basis to create a good workforce,” he said.
Scotty must be seeing a similar result from polls, because even he is talking some game about increasing aid to the UW System in the next budget. But naturally, instead of admitting that this year’s cuts may have gone too far, Scotty can’t just do the right thing and reinvest in higher education. Instead, the governor mentioned that any UW increase would come with strings attached.
The governor slashed UW System funding in each of his previous three budget bills, with a controversial $250 million reduction approved as part of the 2015-17 budget. The cuts have resulted in program and employment cuts at campuses across the state, including the loss of 179 full-time-equivalent positions at UW-Eau Claire and 55 at UW-Stout.

Walker cautioned that any increase in funding would be tied to performance and efforts to prepare graduates for high-demand fields. He cited UW-Eau Claire’s efforts to increase its four-year graduation rate and UW-Stout’s 97.3 percent placement rate as examples of strong performance that can result in more quality workers for Wisconsin employers.

Such efforts send an important message to students, Walker said, adding, “We want you to get a great education, but we also want you to get employed so you can use those skills not only to support yourself and your family, but to support our economy, to support our communities.”
You can see how that contrasts with what the real job creator in Madison and the Chamber of Commerce guy in Eau Claire were saying. The Walker Administration’s economic strategy continues to be based around the wants of established businesses and campaign donor oligarchs instead of increasing Wisconsin’s economic competitiveness through improving the talent pool and boosting start-ups. Does anyone doubt that this “performance-based” aid for the UW would be given with a heavy amount of input from Wisconsin Manufacturers and Commerce and Koch-related organizations, and that they’d be more interested in generating head-nodding worker drones instead of dealing with increased competition from entrepreneurs and innovators?

So ignore the election-season “moderate” talk from ALEC/GOP- these guys either still don’t get how to add jobs in the 21st Century, or they’re too paid off to want to get it. If you want the strategy to change in Wisconsin, you need to change the decision-makers and the politicians.

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