Saturday, August 19, 2017

Trump-Feingold voters? Sure seems like it

I saw this map get tweeted out yesterday, and found it very telling.

That map is comparing the vote totals, so the bluer something is, the better Trump did compared to Johnson, and vice versa for the red part of the map. As the tweet implies, Trump generally did better than Johnson in the 608 and 715 area codes, and Johnson did better than Trump in the 414, 262 (especially) and the 920.

So what can we learn from this? I think that Dems have a chance for a strong bounce-back in the Western part of the state in 2018, since a common thread in a voter's mind with Trump and Feingold could be related to an anti-establishment, anti-big money mentality. Yes, I know it's silly to think of Trump as anti-big money these days, but vs Hillary Clinton, that was the image being presented to casual and low-info voters in November 2016. We have seen more than a few articles since the election that indicated part of the reason these places flipped to Trump was out of fear and frustration with a political, economic and social system that they felt was leaving them behind.

With Trump now being exposed as a racist, ineffective moron as president, with little changing in the economy (especially in rural Wisconsin), you would think that a strong message of real economic populism against big money and Big Ag would resonate well with those Trump-Feingold voters. And I would bet more than a few of those low-info Trump voters have been shamed by Trump's open welcoming of white supremacists into the White House, and a unifying message of "THIS IS NOT WHAT THIS STATE AND THIS COUNTRY IS ABOUT" should be a central message of Dems in Wisconsin in all corners of 2018.

A quick sidelight- this map also shows the fallacy that "Clinton did better than Feingold in November." She didn't. It was more a reflection of people being more likely to vote 3rd party in the presidential race. Take a look at these final figures from the 2016 election.

Total votes
Clinton 1,382,536 46.5%
Feingold 1,380,335 46.8%

This is the base that Dems should start from, and try to work up from. Interesting how it's not much different than the 46-47% they've consistently gotten against Scott Walker, is it?

Back to the map. Let's go over to the red eastern half of the state is a strong indicator of the influence of "never Trump" voters that get their orders from AM talk radio. These are individuals who got upset that Trump's vicious tone and ignorance was in their face, and they turned away from it (they prefer the more subtle dog-whistles of Ron Johnson, Paul Ryan or Scott Walker).

These people were never with Trump to begin with, and followed along with Walker and his AM radio spokespeople in April 2016, when they voted for Ted f'ing Cruz over Trump. But also note where Trump won, and how it matches up with the blue parts that he overperformed in for the first map.

This is where Dem candidates for Congress can win big with a message of "I am the only candidate that will stop Trump's madness." It also could be a good place for Dems to win downticket, as the general idiocy and two-facedness of Walker has become apparent, as Scotty has kissed up to Trump for the past year, and is now refusing to call out Drumpf for his racism and false equivalencies after the events in Charlottesville. This would also have a good byproduct of driving up anger and resentment with Dem voting constituencies that will be needed next year.

Also, a strong message against corporate handouts like the Fox-con could also be a winning argument in the eastern half, as the resources being funneled down to the SE corner of the state will result in some funds being taken away from road projects and other services in the Milwaukee and Fox Cities areas.

Lastly, Trump's lagging results in eastern Wisconsin also shows an opportunity to attack RW talk radio itself, as a dishonest broker that isn't telling people the full story. The dummies who still listen to KLAN radio 1130 and Bader and other cynical AM slime might not listen, but a lot of casual bystanders and low-info voters might, and once you can start breaking the Bubble of Bullshit that exists in the 262 and 920 as a result of corrosive talk radio and other obnoxious GOP partisans, then the GOP's ability to run up the margins they need in those areas goes down greatly.

Those are my musings, and I'm sure I'm missing a lot of angles. But the fact that there were a sizable amount of Trump-Feingold and Clinton/3rd Party-Johnson voters is something that Dem leaders in Wisconsin should think about, learn from, and utilize to win in 2018.

Friday, August 18, 2017

Wisconsin still far behind in jobs, and Foxconn won't change that

The state-by-state jobs report came out this afternoon, and it made Wisconsin's recent swoon in job growth look even worse.

A stat that immediately jumps out at you is that most Midwestern states continued to gain jobs in recent months, but not Wisconsin.

April 2017 – July 2017
All jobs
Ohio +29,000
Ill. +19,800
Minn +14,100
Iowa +10,700
Ind. +4,300
Mich +3,400
Wis. - 5,500

Private sector
Ill. +20,300
Minn +13,600
Ohio +12,800
Iowa +10,500
Ind. +10,000
Wis. -1,200
Mich -3,300

Yes, the Illinois stats surprised me, especially given that it spans their fiscal crisis. But 3 months is a small sample size, and could simply be a regression to the norm from Illinois underperforming in the seasonally-adjusted stats earlier in the year. Likewise, Wisconsin's job growth was allegedly strong between January and April, but has fallen back since then.

If you widen it out to the last 12 months, Wisconsin ends up mediocre at best- 4th out 7 for total jobs and 5th of 7 for private-sector jobs. Even worse, take a look at who is lapping the field at the top.

July 2016-July 2017 job growth
All jobs
Minn +2.08%
U.S. +1.49%
Mich +1.44%
Iowa +1.01%
Wis. +0.90%
Ind. +0.88%
Ohio +0.87%
Ill. +0.55%

Private sector
Minn +2.24%
U.S. +1.68%
Mich +1.49%
Iowa +1.39%
Ind. +1.01%
Wis. +0.99%
Ohio +0.91%
Ill. +0.68%

UW professor Menzie Chinn has more on how Minnesota has continually kicked Wisconsin's ass for job growth over the 6 1/2 years in the Age of Fitzwalkerstan. And even more remarkable, July 2017 marks the first time that Minnesota has more total jobs than Wisconsin, likely for the first time ever.

Ok, so we’re not Illinois. But as I have said numerous times, we wouldn’t base the Packers’ success over whether they finished ahead of a 3-13 Bears team. So why are we accepting not being the complete governmental train wreck that Illinois is….for the time being.

By the way, take a look at how another tax-cutting ALEC experiment has been doing on the jobs front over the last year.

July 2016-July 2017 job growth
All jobs
Kansas -0.76% (-10,800 jobs)

Private sector
Kansas -1.05% (-12,100 jobs)

No other state is close to this bad for total job loss over the last 12 months, and only the small petro-states of Alaska and Wyoming have lost jobs AT ALL in that time period (-1,100 for Alaska, -3,000 for Wyoming).

Given Wisconsin’s declining budget situation, we are getting more like Kansas by the year, and the Fox-con will speed up that wreck, given that the majority of the tax handouts will occur before most of the jobs even start at the facility.

Is that what you want, to become a wasteland like Kansas? Or do you want to be like Minnesota, which is creating jobs twice as fast as we are, and with a much healthier financial situation on top of it. Funny how that happens when you don’t give away the store to the rich and corporate, and actually invest in education and quality of life, isn’t it?

Thursday, August 17, 2017

Wisconsin falls further behind with a mediocre July jobs report

As the State Assembly debated the Foxconn package today, the state’s Department of Workforce Development dropped the July jobs report for Wisconsin. And on the top level, it looks like a lot of “Meh.”
Place of work data: Based on preliminary data, the state added 26,500 total non-farm jobs and 25,000 private-sector jobs from July 2016 to July 2017, with a significant year-over-year gain of 9,600 manufacturing jobs. The state added 3,600 total non-farm and 100 private sector jobs over the month.

Place of residence data: A preliminary seasonally adjusted unemployment rate of 3.2 percent in July 2017, up slightly from 3.1 percent in June. The rate remains lower than the national unemployment rate of 4.3 percent in July 2017. Wisconsin's labor force participation rate decreased slightly to 68.8 percent and continues to outpace the U.S. rate of 62.9 percent in July.
Mediocre numbers for July, but the bigger news hit with revisions to June’s figures, and not to the good side.

June 2017 Wisconsin jobs revisions
All jobs -4,100
Private sector jobs -2,300

So you combine with July’s figures, and that adds up to LOSSES of 500 jobs overall and 2,200 in the private sector. Not the right direction. Combined with job losses in May, this means that Wisconsin is reporting fewer jobs now than they were back in April.

And the DWD’s happy talk of “26,500 total jobs and 25,000 private sector jobs” over the last year also sucks. Last month those 12-month figures were 38,400 and 35,700, respectively, and it now puts the state’s job growth rate under 1% for the last 12 months, which is well below the US rate over the last year.

Rate of job growth, July 2016 – July 2017
All jobs
US +1.49%
Wis. +0.90%

Private Sector
US +1.68%
Wis. +0.99%

And the Walker jobs gap has grown larger as a result, now over 115,000 jobs for both private sector and total jobs.

Also, take a look at what happened on the other side of the St. Croix River while we were stagnating in July.
Minnesota employers added 7,700 jobs in July, according to seasonally adjusted figures released today by the Minnesota Department of Employment and Economic Development (DEED).

In addition, June’s employment figures were revised upward by 4,900 jobs to bring total gains that month to 9,300 jobs. Minnesota has added 66,701 jobs in the past year, an increase of 2.3 percent, compared with a national growth rate of 1.5 percent during that period.
That's 2 1/2 times the job growth that Wisconsin has had since July 2016. And Minnesota isn’t destroying their budget to hand out $3 billion to a foreign corporation and carving up environmental standards in the process. Why aren’t we looking at the places that are actually succeeding in 2017, instead of doubling down on the same failed giveaways?

And with even more evidence today that the Walker/WisGOP Way is continuing to leave this state behind, why would anyone trust the claims of this Governor, WEDC and the GOP-puppets in the Legislature? This is true not only in how Robbin’ Vos and other WisGOP crooks making the laughable claim that their “reforms” have improved the state’s economic situation (the reality is more like “Thanks, Obama!”), but also when it comes to thinking that the Fox-con development will somehow change things for the better for the entire state.

This Reign of Error has gotta end, or else we aren’t ever going to be economically competitive with the rest of the country for decades, if ever.

Wednesday, August 16, 2017

GOP budget dysfunction means K-12 schools will likely struggle again

The largest part of the delayed Wisconsin state budget is aids to K-12 schools, and with Milwaukee Public Schools already opening up this week, and other most public schools following in 2 weeks, these districts are dealing with some serious uncertainty.

Molly Beck of the State Journal had an in-depth breakdown of the difficulties many districts are having in trying to pinpoint how much money they will have available for the start of the school year, and how some schools might have to take out a loan to pay the bills until the budget is finalized.
The leaders of the state Senate have said lawmakers on the state’s budget-writing committee could resume work on the budget Aug. 23. But if a budget is not in place eight days later, schools in rural areas will miss state payments they usually get in September to subsidize school operations, according to a memo from the Department of Public Instruction sent to budget-writing committee members this month.

“(The delay) may cause some districts to have to short-term borrow to cover this deficit,” said Kim Kaukl, executive director of the Wisconsin Rural Schools Alliance. “The majority of our districts are already working with very tight budgets and any aid delay in payments can have a serious impact.”

DPI spokesman Tom McCarthy said the department could push back the rural school payment deadline if lawmakers gave DPI a “clear signal” that the budget was going to be passed quickly.
A couple of large complications in figuring out the final amount of school aids is whether the Fox-con becomes law in the next 2 weeks, as that might restrict the amount of revenue available, and it is unknown how much voucher money will be funneled away from schools, and this caused many districts to back off on hiring and improvements for this year. This means that the start of the school year could be quite a mess.
...[Since] Republican lawmakers in the Senate and Assembly have each proposed separate education spending plans. Kaukl said a number of rural school districts have delayed hiring and purchasing until they know what is included in the state budget.

“This may mean classes may begin with substitute teachers covering a class, classrooms being overloaded or, worse case, courses being dropped,” Kaukl said.
That is NOT what Governor Walker wanted when he put in a proposed increase in K-12 school spending in this pre-election budget. But all Scotty seems to care about these days is selling and shoving through the Fox-con instead of giving a damn about what happens with the budget. And Walker and the Legislature have no one to blame but themselves, because it is their dysfunction, corruption (especially on vouchers) and no-tax gimmickry that prevented them from coming up with a sensible solution in a K-12 budget that should have been relatively easy to figure out.

It's completely unacceptable, and it's yet another example of why these self-absorbed WisGOP clowns at the Capitol need to be kicked to the curb ASAP.

Will Wisconsin even have the people to pull off the Fox-con?

As the Foxconn package comes up for a vote in the full Assembly tomorrow, more discussions of the project and what might actually happen if the multi-billion dollar giveaway incentive package becomes law. What hasn't been brought up much is the question about how the Foxconn package fits into the overall state economy.

State Rep. Gordon Hintz put that other factor in play when it comes to questioning the Fox-con - can a state with a stagnant and aging population even handle a massive project like this?
The important statistic when considering the availability of labor is the “prime working age” population, which economists classify as people between 25 and 54 years old. Wisconsin had 105,000 fewer prime working age people in 2015 than it did in 2010. Some of the sharpest decreases occurred in Jefferson, Kenosha, Ozaukee, Racine, Walworth, Washington and Waukesha counties. As the state with the 15th oldest population in the U.S., Wisconsin’s prime working age population is expected to continue to shrink through 2040 to just 33% of its total population. This is down from 41% in 2010.

Looking at 2016 census estimates for Racine and Kenosha counties, Racine lost 6,709 (8.3%) of its prime working age population in just the past 6 years. Kenosha lost 2,998 (4.3%) since 2010. So the very region being counted on to fill as many as 35,000 jobs has a smaller number of working aged people, and that number is continuing to decrease….

In addition to the lost workforce due to the retirements of baby boomers, more than 27,000 people left Wisconsin between 2010 and 2014, according to a study from the Wisconsin Taxpayers Alliance (WISTAX). According to Todd Berry, WISTAX president, Wisconsin lost people “at a faster rate than we should, and this means not only are we not going to grow the workforce, we’re going to see a shrinking workforce if we keep that up.”

Hintz goes on to note that Wisconsin takes in a smaller amount of immigrants than much of the country (4.8% foreign-born vs 13.5% nationwide), so there’s no help in the state’s demographic issues there, and while the low amount of people in the working-age population could mean a labor shortage that drives up wages (which would be good if it happens), Hintz adds that this will increase the incentive for Foxconn to turn to robots and other automation faster.
Not sure I agree with the “higher wages” part of the hypothesis from Rep. Hintz, as I think Wisconsin’s low manufacturing wages are something that won’t change with the Fox-con, but I agree with the point about Foxconn automation being a real possibility (especially over 25 years) and lessening the payoff in terms of jobs and income taxes. But there are two other more factors that also are in play.

A generic job making $12-$15 an hour at Foxconn isn’t going to be something that makes a person pack up and leave for Racine or Kenosha County on his/her own. That area is going to have to offer quality schools, decent roads and services, and a good quality of life in order to encourage the labor pool that will be needed for such a large project. Given the future budget cuts and environmental degradation that will accompany this Fox-con, that will not happen. It exposes what a rushed, desperate gimmick the Fox-con is, as there is no larger strategy coming from Gov Walker or the WisGOP Legislature beyond trying to cut taxes on the rich and corporate, and funnel taxpayer dollars to campaign contributors.

Do the white guys in this pic have a clue?

In addition, if people actually do choose Foxconn over other employers, what happens to other businesses that aren’t getting a state handout? There is already displacement going on in the state’s economy due to legislative buffoonery in the WisGOP-run Capitol. Take a look at this article that floated out near the end of last week from the Daily Reporter, and these words from Terry McGowan, the head of the International Union of Operating Engineers.
WisDOT officials have seen the state’s highway money dwindle in recent weeks as lawmakers struggle to pass a new two-year budget. Wisconsin’s previous spending plan expired on June 30. Without a new budget in place, the state continues to run on a “base-level” of funding that does not include the sort of new bonding that many road projects depend on.

McGowan said the budget struggles are having real consequences for the union members he represents. At a Local 139 meeting in Pewaukee on Wednesday evening, he was told by several people that they had “migrated” from road jobs to working on buildings and underground utilities.

“The road industry has been unreliable,” he said.

McGowan also mentioned that operating engineers are disheartened when they hear that some lawmakers want to repeal what remains of the state’s prevailing-wage laws. Uncertain that they will be able to continue making a decent wage on public jobs, many have decided to try their luck in the private sector.
There are only so many construction workers to go around, and if the ALEC-GOP Legislature continues to support wage suppression laws that discourage workers from choosing Wisconsin as a place to work, what happens when Foxconn sucks up most work in that area? Do costs go through the roof, and/or are businesses not able to afford to hire contractors because Foxconn takes up too much of the work?

Now add in the pothole-filled roads in other parts of the state that become even less likely to be fixed, and the likelihood of budget deficits leading to cuts that affect jobs and services in all parts of the state, and you can see where funneling so many resources toward Foxconn could hurt the economy in many other parts of the state.

This displacement of spending and economic activity isn’t mentioned in the Legislative Fiscal Bureau’s analysis of the Fox-con, but maybe it should. Because without a reversal of the recent trend of people leaving and/or growing old in Wisconsin, there will inevitably be problems in trying to find workers to do the work needed. This is true not only for Foxconn, but for other parts of the state’s economy. And I don’t see the ALEC-GOPs passing anything that’ll make the casual person want to come to Wisconsin - on either the “pay and work conditions” side, or in the “quality of life” side.

Well, there is one way to increase the likelihood of workers being available for jobs on the Fox-con - a recession with sizable unemployment. But if that's the case, wouldn't a New Deal-style public works package do a lot more good for Wisconsin than using all of those tax dollars on one corporation (and allow a lot more Wisconsinites to reap benefits from those projects)? And oh yeah, a recession would collapse the state’s house-of-cards finances faster than the Fox-con will.

So barring some kind of unforeseen "Escape to Wisconsin" by people who don't live here now, we're pretty screwed if this Fox-con package becomes law.

Tuesday, August 15, 2017

While WisDems call out Trumpist hate, Walker's silence is deafening

As President Trump digs a deeper hole by sympathizing with Nazis and other white supremacists, some of the disgust is soothed by media and Democrats have generally been pushing back on this racist garbage, and calling out half-assed statements and false equivalencies.

A good example was this response from the Democratic Party of Wisconsin from the event in Charlottesville over the weekend. DPW Chair Martha Laning had a decent statement that both said neo-Nazism had no place in America and that Dems will "continue to build bridges, not walls. We will continue to advocate for communities of color, for our LGBT brothers and sisters, and for those of every faith."

Then Vice-chair and State Rep. David Bowen laid the lumber.
"We must recognize the connection between the words and policies of Alt-Right and Tea Party leaders who have infiltrated the Republican Party. The stakes are too high to pretend otherwise. When President Trump began his campaign by calling Mexicans rapists and criminals, neo-Nazis heard his words and knew they had a candidate they could support. President Trump took it a step further by hiring many top officials in the White House with direct ties to white supremacy groups. Those actions legitimized and set precedent for the actions that occurred in Charlottesville.

"If you want proof of this connection, look at the statements and actions put out by President Trump, and his colleagues like Governor Walker. Neither were willing to name white supremacists as the cause of violence and death in Charlottesville. Neither is willing to label the perpetrators as domestic terrorists. Instead, President Trump condemned the “many sides” involved in this violence, and Scott Walker responded by putting out one tepid, generic tweet.

"These are not the actions of strong leaders or those seeking a swift end to xenophobia and bigotry. They are the actions of cowards who fail in the call for accountability and then aim to use hatred to win elections while further dividing this country.

"President Trump and Governor Walker have shown the world their true colors. When they are next on the ballot, we’ll show them ours.
-State Rep. David Bowen

That's how you do it, Dems, and they must continue to remind voters that the Republicans and their spokespeople on AM radio are more than happy to pander to the gut instincts of racists. Dems must make the voters choose sides, because sides must be chosen after the disgraceful events in Charlottesville and the pathetic minimizations that have been done by this Fascist-friendly president.

The Giovernor made his side not choosing. Take a look at Scotty's Twitter feed in the last 3 days, since his pathetic non-statement against "violence and hate" in Charlottesville. A whole lot of "job photo ops" with campaign contributors and BS spin about the Fox-con. Oh, and this thing.

Pence has generally taken the "both sides are to blame" tact and whined that "the media spent more time criticizing the president's words" than discussing the violence itself. I would guess Scotty's in the same boat, as I can't remember Walker saying one bad word against Trump since the Donald took the GOP nomination over a year ago.

And I bet he won't have the guts to say anything now, because Walker will pander to and take money from anyone, if it improves his chances of winning. As I mentioned on Sunday, race-baiting and stirring up resentment among mediocre white people has been central to this grifter's career, and I am convinced there is no bottom that Scotty wouldn't explore. Walker's deafening silence in this time of a crisis of leadership in the White House confirms that instinct that I have about him.

He and his WisGOP backers need to put out into the political wilderness. They honestly deserve worse than that, but that's the least they must get in the next 15 months. Or else this state is done and likely not worth saving.

Monday, August 14, 2017

No tax revenues + no Trump Boom = more Wis budget problems

With all of the Foxconn talk in Wisconsin, it’s also worth remembering that we still don’t have a state budget for the next two years. And an article today from the Milwaukee Journal-Sentinel’s Jason Stein mentioned that the budget picture is starting to concern Senate GOP Leader Scott Fitzgerald and others in WisGOP leadership, because the house of cards that this pre-election, gimmick-filled budget was based on may be starting to collapse.

The reason? One we should be used to in GOP-controlled Wisconsin - lower-than-projected tax revenues.
In May, the nonpartisan Legislative Fiscal Bureau projected state revenue growth of 2.7% for the fiscal year that ended in June.

Final tax collection numbers including the month of June have not yet been released by the Walker administration. But as of the end of May state revenues were at 2.5% growth for the year.

That modest difference — if sustained through June — could amount to up to a few hundred million dollars of smaller than expected growth. What's more, lower tax collections for last year would drive down estimates for each of the next two years within the next state budget, compounding the effect.
Actually, a 0.2% shortfall would only be around $34 million, but the point about the effect of driving down future year revenues is the real problem. And that shortfall for the net 2 years would be likely become larger if the predicted “Trump Boom” that LFB and other economists were counting on in January doesn’t happen.

Back in January, the Legislative Fiscal Bureau was basing its rosy revenue outlook on a strong GDP growth outlook on a "Trump Boom" that would include tax cuts and big increases in infrastructure.

Jan 2017 LFB estimates of real GDP growth
2017 +2.3%
2018 +2.6%
2019 +2.3%

But so far in 2017, we’ve seen real GDP growth come in at 1.2% in the 1st quarter and 2.6% for the 2nd quarter, which means growth would have to speed up to 2.7% in both the 3rd and 4th quarters of 2017 – the fastest pace in 2 ½ years. And the tax cuts and infrastructure package hasn't even gotten off the ground, and the uncertainties in health care will also hold down the economy in the coming months.

Don't bet on it, Scotty

This stagnation contributed the International Monetary Fund downgrading projected US growth in 2018 to 2.1% last month. Instead of economic stimulus, what’s now more likely to come out of DC is a fiscal crisis, as the debt ceiling and a new federal budget both have to be figured out in the next 7 weeks. Good luck getting either of these items passed in any sort of smooth manner, given the buffoons running Congress and the White House these days.

With the economic and fiscal picture getting dimmer, State Rep. Gordon Hintz noted how absurd it was for Republicans to talk about giving away massive amounts of money in corporate tax cuts while there may be less money to go around.
Hintz said that Republicans are considering cutting the personal property tax assessed on some businesses in the state and committing to up to $2.85 billion in cash payments to Foxconn Technology Group of Taiwan in exchange for a liquid crystal display plant. Both actions could make it harder to balance future state budgets, he said.

In light of the uncertainty, Hintz said he was considering asking the fiscal bureau to revisit its revenue estimates prior to the update that is currently scheduled for January.
Maybe the reality that things are going to get worse is exactly why Governor Walker and other WisGOPs are trying so hard to jam through the Fox-con, to distract people from the mediocre present and lousy outlook for both Wisconsin’s economy and its (still not-completed) budget. Why else would they lie and overpromise about what the Fox-con is about?

With another Wisconsin jobs report coming up later this week and the final 2016-17 revenue numbers likely coming out by the end of this month, what I see between the lines is a lot of concern from WisGOPs who fear that they will finally be held accountable for how Wisconsin keeps lagging behind our Midwestern neighbors and the rest of the country after 6 ½ years of the Age of Fitzwalkerstan, and an Obama Recovery that has gone on through that entire time period.

And they should be afraid.

Walker Admin goes on Mke TV, J'ville paper to deceive on Fox-Con

It sure seems like the Walker Administration and other GOP hacks are getting desperate when it comes to selling the Foxconn package to voters. This weekend, Walker Administration Secretary Scott Neitzel and WEDC Chair Mark Hogan went on Mike Gousha’s show to try to promote how great Foxconn is going to be.

In the process, the Walker appointees claimed that the state’s Legislative Fiscal Bureau wasn’t giving Wisconsinites a full picture of Foxconn’s impact.
But the limits of the analysis also hide the potential of the deal, Scott Neitzel, secretary of the Department of Administration said on “UpFront.” Neitzel appeared on a segment with Mark Hogan, CEO of the Wisconsin Economic Development Corporation. Both men were involved in crafting the deal.

The breakeven analysis accounts for the 13,000 Foxconn jobs, but not for the “indirect and induced jobs across the whole state” or a “whole new high tech manufacturing ecosystem.”

“There are going to be benefits beyond what is just in that report that are very hard to quantify using historic models,” Neitzel said.
Well, let’s go to pages 15 and 16 of the LFB’s analysis of the Foxconn project, which includes assumptions on added employment from the Foxconn project. And what you will find is that LFB took the best-case scenario for the Walker Administration and other Fox-con supporters.
The estimates assume that the project will require an average annual employment of approximately 10,200 construction workers and equipment suppliers earning an average total compensation of approximately $59,600 (including benefits) per year during the four- year construction period (from 2018 through 2021). Total income for these individuals is estimated at $2.4 billion. In addition, it is assumed that nearly 6,000 indirect and induced jobs will be created during the construction period, with an average total compensation of $48,900.

It is estimated that the additional construction-period jobs would generate increased state tax revenues (primarily income and sales taxes) equal to approximately 6.3% of the additional gross wages. The total increased state taxes associated with the construction period are estimated at $186.9 million.

As noted, permanent staff at the Foxconn facility are estimated to increase from about 1,000 in the second half of 2017 to 13,000 beginning in calendar year 2021. The average annual wage for these employees is estimated at $53,875, based on a headcount distribution, by job type, provided to EY by Foxconn and median wages for each occupation from the Economic Research Institute. Total ongoing payroll at the company is projected to be $13.8 million for the remainder of this year and increase to approximately $700 million annually beginning in 2021. State tax revenues associated with the additional employees and wages are estimated to increase from about $900,000 this year to $44 million annually beginning in 2021.
And this report proves Neitzel and Hogan to be either lying or ignorant when they went on Gusha’s show and claimed the LFB didn’t look at “indirect or induced jobs.”
Indirect and induced jobs associated with the project are estimated to total 22,000 beginning in 2021, based on a multiplier of 2.7. Average annual wages for these individuals are estimated at approximately $51,000. Total ongoing wages are estimated at $1.12 billion annually, and related state taxes are estimated at $71 million per year. Smaller impacts are estimated in calendar years 2017 through 2020 as the project ramps up.
The LFB assumes $115 million in additional income tax revenues in each year of their analysis starting with 2021, and they assume that Foxconn will not lower headcount below 13,000 people in the next 20 years, even with changes in technology, consumer tasters, and productivity. That’s pretty damn lenient to the Walker Admin’s case, if you ask me.

So all the Walker Admin hacks have to promote Foxconn is vague promises of good things that are “very hard to quantify using historic models.” I have no idea what these are, as the Foxconn facility is projected to be making LCD screens for TVs and iPhones, and doesn’t seem to be involved in chip design or other technology development.

Which circles us back to this point- if there were no handouts, then manufacturing those things in Wisconsin may well be a good thing vs manufacturing them overseas. But why would we give away hundreds of millions of dollars in cash to a corporation to do it in a time when the state can’t adequate fix its roads and bridges, and has a $1 billion budget deficit looming before we even account for the Fox-con?

Let me also address another attempt to assuage concerns about the Fox-con by a Walker appointee. This one comes from Department of Revenue Secretary Rick Chandler, who claims that Wisconsinites shouldn’t worry too much if Illinois residents go across the border to get jobs at Foxconn, because of the state’s reciprocity agreement with our neighbors to the south.
In the case of Illinois, we have an income tax reciprocity agreement so that Wisconsin residents who work in Illinois do not have to file income tax returns there, and Illinois residents who work in Wisconsin do not have to file tax returns here.

Instead, they only file returns in their home state. We then calculate how much the Illinois residents would have paid in Wisconsin taxes, and how much the Wisconsin residents would have paid in Illinois taxes, and the states agree to pay those amounts to each other at the end of each tax year.

This means that Illinois residents who work in Wisconsin are paying income taxes to Wisconsin through the income tax reciprocity mechanism, even though they file their returns in Illinois. Illinois collects taxes from them and then sends us the amount they owe on their Wisconsin earnings.
Chandler accurately is describing how his works- to a point. However, if someone is still living in Illinois, they are still paying local property taxes and likely buying more items out of state than a Wisconsin resident would. And they are not likely to be affected by cuts to Wisconsin schools and services that will result from us giving away hundreds of millions of dollars a year to Foxconn.

Furthermore, as we found out when the LFB mentioned last month that Wisconsin would owe an extra $51 million in 2017-19 to Illinois under this reciprocity agreement, the taxes that Illinois resident would pay on assets or other business income would stay in Springfield, and not head up to Madison.

Bottom line, while our reciprocity payment would likely go down if Foxconn hired a sizable amount of FIBs, we wouldn’t feel as much of a benefit to our budget as we would if that job was taken by a Wisconsinite, so give Chandler a “Half true” for that article in the Janesville Gazette (of course, this assumes the Illinois resident would take a job in lower-paying “work-for-less” Wisconsin in the first place).

The bigger story is that the Walker Administration felt a need to trot out their cabinet members and other appointees to try to sell Foxconn further, which is a clear tell that the average Wisconsinite isn’t buying the Fox-con as they find out about it. If Dems are smart, they’ll come out strong against this scam as it goes through the Legislature in the coming weeks, and tie it around the necks of any Republican who dares to sign off on this pre-election corporate welfare.

Sunday, August 13, 2017

How Trumpism and Walkerism helped to build 2017's racist ugliness

I've had the better part of a day to reflect on the disgusting murder and actions in Charlottesville, Virginia, and the emotions are all over the board for me on this.

First of all, if you didn't think Donald F'ing Trump wasn't unfit for office before this, there isn't much doubt that he is unfit after this pathetic pile of nothing that he spat out yesterday.
"We condemn in the strongest possible terms this egregious display of hatred, bigotry and violence on many sides, on many sides," Trump said during a short statement from his private golf club in New Jersey. "It has been going on for a long time in our country -- not Donald Trump, not Barack Obama. It has been going on for a long, long time. It has no place in America." - Donald Trump
"On many sides"? No Donny, it was WHITE SUPREMACISTS that did this, and they chose Charlottesville because they were getting rid of monuments to the white supremacist society known as the Confederacy.

"It has been going on for a long time"? What's been "going on," Drumpf? We didn't get a response to that, because scared little Donny ran off the stage without taking follow-up questions. And a famous Wisconsinite called out Trump for coming up so small in such a big moment.

But one group heard Trump's false equivalency loud and clear.

On a related note, former KKK Grand Wizard David Duke told reporters his fellow white supremacists would "fulfull the promises of Donald Trump", and told the dirty secret behind Trump's non-statement in public soon after.

This is the bigger story coming out of the events of Charlottesville. Trump was far from the only Republican who gave out a non-statement on this. Take a look at what the top Wisconsinite in Congress and Wisconsin's Governor didn't say yesterday.

You see the words "white supremacy" or "Nazis" in there? Me neither. Now, to be fair to Lyin' Ryan he did call out white supremacy in a tweet...7 HOURS LATER (after the public blowback became apparent). I'm still not counting on the Spineless Speaker to do anything beyond the bare minimum that is politically required in order to keep from losing too many votes from the racist segment of the GOP vote.

On the other hand, Walker gave out 4 tweets on the Brewer game he was (allegedly) at last night, but NOTHING ELSE ON CHARLOTTESVILLE or the white racism that led to those incidents. That shouldn't be surprising, because Scott Walker's career has been advanced by racist dog-whistles to make people look the other way on his regressive and failed right-wing polices. Let's go back to perhaps the best article on this topic- "The Unelectable Whiteness of Scott Walker", by Alec MacGillis in 2014.

You built this, you amoral slime

MacGillis' article begins with AM radio host Mark Belling giving a race-tinged take belittling African-American Congresswoman Gwen Moore. That's hardly unusual for Belling or other hosts on KLAN Radio 1130, but it's something that might make a respectable politician decide he/she doesn't want to be associated with. Not Scotty.
In any case, the riff did not keep the state’s governor, Scott Walker, from appearing on the show a few days later. Belling’s treatment of Walker was notably more deferential. “Have you,” he asked, “sat back and thought about what has been accomplished by yourself and the Republican legislature? Has it really sunk in that you’ve transformed a fiscally reckless state into perhaps the most fiscally sound state in the nation? Has it sunk in, I guess is what I’m saying, do you realize what’s been accomplished?” Walker replied that no, his achievement had not sunk in, because he had been “so busy doing it.” (we'll leave aside the fact that Belling's take on "fiscally sound" is a blatant lie).

That accomplishment—effectively eliminating collective bargaining for most public employees in the state, facing down the angry protests that followed, surviving a rancorous recall election—has vaulted Walker into the top tier of Republican presidential contenders for 2016. He is the closest person the party has to an early favorite, and not simply because of Chris Christie’s nosedive from grace or because Jeb Bush is still waffling about his intentions. Walker has implemented an impeccably conservative agenda in a state that has gone Democratic in seven straight presidential elections. Unlike Mitt Romney, or, for that matter, John McCain, he is beloved by the conservative base, but he has the mien of a mainstream candidate, not a favorite of the fringe. His boosters, who include numerous greenroom conservatives in Washington and major donors around the country, such as the Koch brothers, see him as the rare Republican who could muster broad national support without yielding a millimeter on doctrine.

This interpretation of Walker’s appeal could hardly be more flawed. He has succeeded in the sort of environment least conducive to producing a candidate capable of winning a national majority. Over the past few decades, Walker’s home turf of metropolitan Milwaukee has developed into the most bitterly divided political ground in the country—“the most polarized part of a polarized state in a polarized nation,” as a recent series by Craig Gilbert in the Milwaukee Journal Sentinel put it. Thanks to a quirk of twentieth-century history, the region encompasses a heavily Democratic and African American urban center, and suburbs that are far more uniformly white and Republican than those in any other Northern city, with a moat of resentment running between the two zones. As a result, the area has given rise to some of the most worrisome trends in American political life in supercharged form: profound racial inequality, extreme political segregation, a parallel-universe news media. These trends predate Walker, but they have enabled his ascent, and his tenure in government has only served to intensify them. Anyone who believes that he is the Republican to save his party—let alone win a presidential election—needs to understand the toxic and ruptured landscape he will leave behind.
While MacGillis was wrong in the sense that Walker was out-Klanned in the 2016 GOP primary by Trump, and looked comparably feckless and cynical to the lowlifes who supported those types of things, MacGillis was right in that Walker gained and stayed in power in Wisconsin because of his race-tinged and anti-intellectual policies.

Look at the list of things that have become law in Wisconsin under Walker.

1. A voter ID law and restrictions on early voting that was pushed through after years of lies about alleged "voter fraud" perpetuated by minorities - lies that we now know were pushed to AM radio by WisGOP operatives like Steve Baas and former Assembly Speaker/voucher money-man Scott Jensen. Portions of those voter restrictions were thrown out 1 year ago on the basis that it constructed excessive barriers, particularly to minorities in Wisconsin.
“The Wisconsin experience demonstrates that a preoccupation with mostly phantom election fraud leads to real incidents of disenfranchisement, which undermine rather than enhance confidence in elections, particularly in minority communities,” U.S. District Judge James Peterson wrote.

In his ruling, Peterson wrote that he could not overturn Wisconsin’s entire voter ID law, unlike recent decisions in North Carolina and Texas, as a federal appeals court had already found Wisconsin’s restrictions to be constitutional. However, he ordered that the state quickly issue valid voting credentials to anyone trying to obtain free photo IDs, calling the current system for issuing IDs a “wretched failure” that overwhelmingly cut out black and Hispanic citizens.

“To put it bluntly, Wisconsin’s strict version of voter ID law is a cure worse than the disease,” Peterson wrote in his opinion.
2. In addition, the same governor promoted by radio hosts that called the former First Lady "Moochelle Obama" (hi, Charlie Sykes!) is now trying to force the (disproportionately minority) recipients of food stamps to take a drug test before receiving benefits, while not requiring the same of the corporates who get hundreds of millions of dollars in handouts through WEDC and other corporate welfare. And the drug-testing proposal is far from the only barriers Walker and WisGOP have put up in the last 6 years trying to prevent the unemployed and poor from getting benefits they are entitled to, frequently resorting to "hammock" language to imply these people are lazy and undeserving.

3. Let's add in Walker's opposition to fully paid-for high-speed rail in Wisconsin, much of which was based out of code words claiming "those people" would be using the train. And Walker infamously said to outstate audiences during the recall elections of 2012 that Walker didn't want Wisconsin to be like Milwaukee. You know, the majority-minority city that has a lot of THOSE PEOPLE, while conveniently leaving out the fact that Milwaukee has been actively defunded by GOP politicians like Walker via cuts in shared revenue, while giving the city no way to make up the difference.

This is merely the surface of my anger with this. Much of my post-Charlottesville seething also has to do with the state's voters who have been taken in by this racist garbage, choosing resentment over good policy because it keeps them from making the hard choices in life. The incentives for GOP politicians is not to be a decent human being, but instead play "divide and conquer", because it appeals to the GOP primary electorate, and encourages enough dopes to ignore the backwards policies that come with the GOP because it sticks a finger in the eye of "those people" that aren't like the white mediocrities that dominate GOP-voting areas.

That's what's despairing and frustrated for me about a lot of this. Sure, I have a sense of decency, and most of my fellow college-educated friends in Madison do as well, but it feels there is little I can do about this other than vent and display my feelings in this blog. My town and my county didn't vote for regressive fuckheads like Scott Walker and Donald Trump. So the rest of the people of Wisconsin have to step up, make racist dog-whistles a loser for Republicans in an election, and make that mentality DISQUALIFYING FOR OFFICE.

The bottom line is that the race-baiting GOP won't change until the voting habits of their rural and suburban constituents change. So will those of you living in areas "represented" by Republicans get a clue, and make these bastards pay a price for their hate-stirring and evil talk? We'd like to use legal, non-destructive methods to change for the better, and Charlottesville shows that we can't wait much longer.

Saturday, August 12, 2017

On Great Taste Day, craft brewing still going well in 2017

On this beautiful Saturday, Madison is hosting the 31st annual Great Taste of the Midwest. I'm sitting this one out after going last year - $60 is getting a bit rich for my blood to go through the effort I need to get tickets - but I did take plenty of part in Great Taste Eve at numerous Madison establishments last night, so it is all good.

I sometimes worry that the craft beer boom of the last 10-15 years is starting to level off, and that there will be an inevitable cutback/correction. But new ones still keep popping up, and the Brewers Association said last week that the industry is still in a growth mode.
Small and independent craft brewers demonstrated continued, but slowed, growth, according to new mid-year metrics released by the Brewers Association (BA)—the not-for-profit trade association dedicated to small and independent American brewers. American craft beer production volume increased five percent during the first half of 2017.

“The growth pace for small and independent brewers has stabilized at a rate that still reflects progress but in a more mature market. Although more difficult to realize, growth still exists,” said Bart Watson, chief economist, Brewers Association. “The beer world is highly competitive and there is certainly a mixed bag in terms of performance. Some breweries are continuing to grow, whereas others are having to evolve their position and nurture new opportunities to ensure they keep pace. Many brewers are benefiting from on-premises and taproom sales, and recent state-based reforms have the potential to help brewers in new regions capitalize on this growth.”

As of June 30, there were 5,562 operating breweries in the U.S., an increase of 906 from the same time period the previous year. Additionally, there were approximately 2,739 breweries in planning. Craft brewers currently employ an estimated 128,768 full-time and part-time workers in a variety of roles including numerous manufacturing jobs, all of which contribute significantly to the U.S. economy.
You may have also seen a few stories in the news relating to beer distribution, and the possibility of new limits and restrictions on who you can sell and distrubte beer and other alcoholic beverages in Wisconsin. The Brewers Guild of Wisconsin chimed in on that issue a couple of months ago, and warned against the State Legislature messing up something that the Brewers Guild says the makers of the beer need to be listened to.
I am writing on behalf of The Wisconsin Brewers Guild in opposition to a proposed bill currently being circulated by Tavern League of Wisconsin, Wisconsin Beer Distributors Association, and Wisconsin Wine and Spirits Institute. These organizations are using this proposed bill in an attempt to limit the growth of Wisconsin’s beverage industry by tightening the definition of the current three-tier system. In addition, the aforementioned parties seek to create additional restrictions and barriers to market through the creation of an Office of Alcohol Beverages Enforcement. This additional level of bureaucracy is, simply put, a solution in search of a problem. Furthermore, as proposed, there is no method of paying for its creation, nor its maintenance, and is thus an example of wasteful government spending.

This proposed bill is yet another example of a dysfunctional three-tier system wherein two of the tiers attempt to speak on behalf of the third. In this instance we, the manufacturing tier, have been intentionally left out of any discussion regarding the construction, management, and enforcement of our industry’s three-tier system. This proposal, and the notion that changes should be made to Wisconsin Chapter 125 without the input of all the affected parties is unacceptable.

We, as Wisconsin’s independent craft brewers, are not three-tier abolitionists; rather we are simply looking for an equitable relationship and an even playing field within our industry. The vast majority of Wisconsin’s independent craft breweries rely on the relationships we have with our wholesale partners to move product to market efficiently. Additionally, without the retail tier’s participation, we would not be witnessing the craft beer renaissance taking place today in all corners of our great state. Meanwhile, not a day passes where there isn’t a new example of one of our small businesses trying to grow, or even get off the ground, being stifled by prohibition era laws. In Wisconsin our production breweries have the ability to cross the three-tier system by self-distribution of up to 300,000 barrels of beer (Ch. 125.29(3M)(6)) and to operate two retail locations within the state (Ch. 125.29(3)(f)). Despite our ability to cross the tiers and effectively operate as manufacturer, wholesaler, and retailer, our commitment to the responsible trade practices and adherence to Chapter 125 has never wavered. Along with Wisconsin’s wholesalers and retailers we stand firm in our commitment to the responsible sale of alcohol within the State of Wisconsin.

That being said, Wisconsin has unfortunately fallen behind the curve when it comes to the opening of new breweries, the growth of existing breweries, and the subsequent addition of well-paid manufacturing jobs that come with that growth. Brewpubs, for example, are held back from growth due to arbitrary caps on their production levels and the number of brewery restaurants they can legally operate. We believe there needs to be action taken to modernize Chapter 125, but we firmly believe that this process should take place in an open discussion that includes all three tiers within our industry. The Wisconsin Brewers Guild strongly opposes any and all changes to Chapter 125 without all parties having a seat at the table.
Of course, back in June the thought was that these changes would be slipped into the budget bill at the last minute, but now with the budget being held up and 6 weeks overdue, it's hard to tell if it's still in play.

But in the meantime, things continue to do well for the craft beer industry in Wisconsin and around much of the country. Plus, it's one of those industries that's difficult to outsource to another country, no matter how much technology improves, and many of these brewers are the type of small-business entrepreneurs that are worth getting behind, as opposed to corporates who lobby to take more and more from the rest of us.

And it couldn't be a better weather week for the big events this weekend in Madison (I've suffered through quite a few humid and/or rainy Great Taste weeks). So get back to the fun, wherever you are.

Friday, August 11, 2017

Fitz and Vos try to put lipstick on the Fox-con's pigs

Looks like Senate GOP Leader Scott Fitzgerald is starting to feel the heat from all sides on the Fox-con. Not only did Scotty Fitz feel the need to do multiple interviews on AM 1130 this week to try stay on the good side of the mouth-breathers, but it is obvious that the public isn’t buying the claims of Governor Walker and Foxconn that the development will actually yield a lot of jobs.

That blowback is clearly reaching GOP senators, so now Fitz would like to see “jobs” actually be central to the Foxconn deal.
"What if later on, a year from now nothing’s happened? Two years from now, still nothing’s happened and the jobs aren’t coming?" Senate Majority Leader Scott Fitzgerald (R-Juneau) said on WISN-AM.

In comments to WISN and to Green Bay-area conservative radio host Jerry Bader, Fitzgerald said he would like to ensure Foxconn creates a certain number of jobs by certain deadlines.

But after meeting later Thursday with top appointees of Gov. Scott Walker, Fitzgerald said he believes that those additional job creation requirements could be handled through contract negotiations between Foxconn and the Walker administration. Lawmakers wouldn't need to put those benchmarks into the Foxconn legislation, which Fitzgerald said would likely pass his house.
As I’ve said before, if there’s nothing in writing that requires a minimum amount of jobs, what’s stopping Foxconn from automating most if not all of the whole plant after getting $1.5 billion in write-offs to build their campus? This has to be included in writing in the final bill.

Except that Marley and Stein’s article indicates that neither Walker nor the state’s GOP slush fund economic development organization want to put in minimum requirements for jobs with Foxconn.
Spokesmen for both Walker and the Wisconsin Economic Development Corp. argued Thursday against putting those requirements in the legislation, saying it would leave the state jobs agency with less flexibility in its talks with the company. WEDC is negotiating a contract with Foxconn to flesh out the memorandum of understanding that Walker and company chairman Terry Gou signed last month.

"It would weaken the state’s negotiating position to comment on the contract at this stage because it is not finalized," said Tom Evenson, a spokesman for the governor.
Major problem- why should we trust the Walker Administration and WEDC (who both are promoting the hell out of the Fox-con) to peform any oversight actions that might make themselves and Foxconn look bad in the near future? So they can’t be counted on to do anything to protect taxpayers’ dollars, and therefore WEDC needs to be taken out of the oversight equation when it comes to the Foxconn enterprise zone.

In another twist, Wispolitics says Fitz is changing his tactics from what he was indicating earlier this week, and now wants to run the Fox-con and the long-delayed state budget through the Joint Finance Committee in the next 2 weeks!
“I guess I’m moving more [from the] budget needs to get done first to: If we can get both of these things done simultaneously and get this stuff kicked out of the Finance Committee then we’d be in a good position,” he said.

Fitzgerald said again Thursday that he hasn’t yet asked Senate Republicans where they stand on the Foxconn bill and therefore isn’t sure whether there’s enough support for it. He said he wants senators to evaluate the bill after the “outstanding two hours” that they had Thursday to ask the Walker administration questions on it.
In a positive sign, Marley and Stein reported that Fitz wants to set some money aside in the 2017-19 budget to cover the revenue losses that will be coming with the Fox-con, and also to deal with the reality that the “Trump Boom” that was projected in January’s revenue figures isn’t likely to happen outside of Wall Street.

But in a bad sign, thee are increasing indications that Assembly Speaker Robbin’ Vos wants to shove through the Fox-con next week, and likely for selfish reasons. And says Fitz might not offer much formal resistance or modifications to the Fox-con in the Senate.

Fitzgerald said he sat down with Rep. Adam Neylon, R-Pewaukee, who chairs the Assembly committee that’s working on the Foxconn bill, to go over amendments that the Assembly is working on ahead of a likely executive session next week.

He said Senate Republicans have decided to go through them individually and possibly offer some of their own, though he said he doesn’t expect the Senate to offer many amendments.

One of the Assembly amendments, he said, would locate Foxconn’s facility in Racine County, where Vos’ district is, but Fitzgerald said that he didn’t know the details.
Combined with the $252 million in borrowing for I-94 South related to the Foxconn site, and it’s becoming obvious that a big motivation behind the Fox-con is that it’s a major pork and kickback project for Robbin’ Vos. “Fiscal conservative” MY ASS!

If Robbin' is going to insist that this thing be in Racine County, then Assembly Dem Leader Peter Barca should get a clue and drop any help he might give for this, and not give these guys cover (if he does, the Dems should look for a new Assembly Leader).

Now it looks like an amendment package for Monday's committee meeting has now come out this Friday afternoon. At first glance, I'm not seeing a lot different than the original Fox-con other than some technical things on how local governments can use their TIF money, and these 3 budget-related items.

1. The $252 million in borrowing must be accompanied by federal money "awarded" to the project, and has to be approved by the Joint Finance Committee before it's released.

2. There would be $20 million set aside in the 2019-21 budget to work with local universities, colleges, technical schools and non-profits to come up with a plan on how to facilitate worker training and employment for suppliers, vendors and those companies impacted by the employment at Foxconn.

3. It requires WEDC to revoke certification for tax credits if Foxconn moves out in a certain amount of time. I'm not certain if that means they can't get further tax credits, or if they try to claw back up to $1.35 billion that had been sent out for "jobs" tax credits. This would still cause major financial problems for the state short-term, and it still doesn't say anything about minimum number of jobs or automation. And the window dressing aboutn"DNR oversight" is a joke as long as Walker and his Koch buddies are in charge.

But it's clear that Vos and the Assembly GOPs are also recognzing the polling which shows the public isn’t buying the Fox-con, and it’s obvious that they are scared that this thing is going to sink them in 2018, which is why they're going to try to put a face of "compromise" on this scam in the coming weeks.

Keep pounding them with the facts, and make them pay a price if they vote to approve this reckless giveaway.

Thursday, August 10, 2017

It was 20 years ago today...the music was awful

It's the lead up to Great Taste weekend, and I have already had 3 splendid limited release choices from Founders tonight. In addition, the Minnesota baseball team is crushing the Brewers' hopes this week as badly as Minnesota crushes Walker's Wisconsin economically, so no heavy stuff here.

Instead, I will forward you to a fun article from The Onion's AV Club, which asks "Did 1997 contain the worst two weeks in music history?" Yes, it's funny to hear Millenial-aged writers try to describe it as "sophisticated" music critics, but sadly, a lot of it feels spot-on.
[ Sean O'Neil]Let’s start with the most innocuous: Smash Mouth’s “Walkin’ On The Sun” is a great song, and the band’s Shrek-fueled fall into viral punching bag since then has only obscured how that cool Farfisa riff cut through all the Counting Crows-esque simpering that was all over alternative radio at the time. Of course, nothing else on Fush Yu Mang sounds like “Walkin’ On The Sun,” and Smash Mouth quickly went on to become a grown-ass-man version of Kidz Bop, which—along with the band’s complete inability to laugh about itself—sort of retroactively ruins it. Still, I suppose if the worst thing we got out of it was a bunch of would-be ska-punk musicians picking up vintage organs instead of the trombone, plus a thousand “All Star” memes, it’s hard to be too mad at it.

Contemporary critics used to say the same thing about Sugar Ray—that the funk-punk-alt-metal-lite-FM-pop mishmash the band produced was just too breezy and silly to hate, and besides, their self-deprecation negates all criticism anyway. But fuck that and fuck them: I will spread my wings right here and say that “Fly” is one of the worst songs to ever suffocate the radio, a pandering, Sublime-aping, reggaeton ragbag that spent the summer of ’97 sprawling across the national consciousness like a frat bro dripping his ultimate-frisbee ball sweat into your futon. I was a college sophomore at the time, and I recall how Mark McGrath’s voice seemed to seep out of every surface within five square miles of campus. Worse, the massive popularity of “Fly” spurred the band to basically release the same damn song two years later, ensuring that no kegger nor future CVS Pharmacy line would ever go without a chill sing-along moment.

And finally, it’s way, way too easy to rip on Limp Bizkit, so let’s do it. With its major-label debut Three Dollar Bill, Y’all, the musical manifestation of the state of Florida took the agitprop of Rage Against The Machine and the alienation of Korn and finally turned it into something backwards-ball-cap-rocking mooks could pound SoCo to while doing donuts in the Hardee’s parking lot. The proliferation of mouth-breathing rap-metal that Limp Bizkit’s popularity inspired, all the misogyny and violence and Woodstock riots it instigated, all the dumb fucking songs that were still yet to issue from Fred Durst’s mouth—there’s no need to reiterate it, especially when Durst said it best himself: “For years I looked into the crowd and saw a bunch of bullies and assholes who tortured me and ruined my life,” he told Rolling Stone in 2009, adding, “I don’t even listen to any type of music that’s like Limp Bizkit at all.” If only he’d come to this conclusion in 1997.

Instead, Durst formed a questionably goateed trinity with Sugar Ray’s McGrath and Smash Mouth’s Steve Harwell—three dudes whose combined efforts made rock radio an unbearable place in 1997 and for most of the rest of the 20th century. And somehow it all emanated from this one, incredibly brief period in American culture. Honestly, Clayton, is there a worse two weeks on record? You’re the internet guy. You tell me.

Clayton Purdom: While it’s easy to look at that unholy trio—plus Insane Clown Posse—and just say “no” on gut instinct, I spent a few hours scrolling through Wikipedia looking for challengers. It’s somewhat encouraging that you need to look for whole bad eras to compete. New wave, hip-hop, early indie rock, and a lot of good mainstream pop keeps the ’80s afloat. The early ’70s still have the vestiges of the late ’60s, and artists were more prolific then; the late ’70s are so rich with good funk, jazz, disco, fusion, and punk that they’re out of contention. The early ’90s have golden-age hip-hop and canonical alt-rock. So I finally settled on a stretch from 1996 to 2005 as the likeliest to yield competition.
Yeah, I gotta agree with that. The late '90s post-grunge era was awful, even though it was a great time to be 22-26. There wasn't Youtube or file sharing or a lot of satellite music where you could discover stuff, and all you could get was CDs and mass-marketed yuppieness. The mid-2000s was a nice bounce-back, (not coincidentally, around the time DirecTV was turning me on to better stuff that I could find on radio) and then I got too old to make much of a judgment. Seriously, I know little of alternative-pop after about 2008-09 (like that didn't happen to you in your mid-30s).

But that being said, I'll differ from the authors on one point- the 3rd Eye Blind album from 1997 is still pretty sweet. Few things sum up being an out-of-school 23-year-old low-income dope coming back from the bars than this.

Although 1997 did have this outstanding album, from a group of guys who are still kicking ass today.

Wednesday, August 9, 2017

WisGOP dysfunction on budget now complicated by unpopular Fox-con

Well, looks like the plans of Governor Scott Walker and Assembly Speaker Robbin’ Vos to slam through the Fox-con as fast as possible is hitting a bit of a roadblock. Jesse Opoien of the Capital Times reports today that Senate GOP leader Scott Fitzgerald says perhaps the state should finish its work on the state budget (which is now 40 days overdue), before it gives away more money with the Fox-con.
Assembly Republican leaders said Wednesday they expect to vote next week to approve a $3 billion incentive package for Foxconn, which plans to open a massive manufacturing facility in southeastern Wisconsin. Meanwhile, Senate Majority Leader Scott Fitzgerald, R-Juneau, told reporters it is "absolutely" his plan to delay action on the Foxconn bill until work on the state budget is complete. The two-year spending plan is now more than a month overdue.

"I'm not doing it just to do it," Fitzgerald said. "I think it's a necessity to try and get the state budget in a good place."
Molly Beck in the Wisconsin State Journal then went further into Fitzgerald’s statements to the press, where Fitzgerald said the Senate is being shut out of discussions about the Fox-con
Assembly members who are making changes to that package have not involved Senate Republicans, Fitzgerald said.

"It's not something we're working together on right now, that's for sure," he said, adding that the bill's passage "absolutely" could be delayed without the Senate's participation now. "It certainly creates a different process than otherwise we're typically used to working (with), especially on a bill this size."
Those amendments and other proposed modifications on the Fox-con haven’t come out yet, but the Senate and Assembly would eventually have to agree to all of the changes for the Foxconn package to pass.

Also telling in Opoien’s article is why Fitzgerald wants the budget cleared up first - because the Fox-con could prove too costly to fit under the 2017-19 budget. Fitz even reopened the possibility that the Senate would do its own budget bill without an agreement in place with the Assembly.
"We're getting closer, but I feel like I'm kind of negotiating with myself [on the budget] at this point, just trying to get the caucus to a position on (eliminating the) personal property tax, how much cash we should have in the balance after this budget is completed, some of the transportation projects that would have a direct effect on the level of bonding, and how all of this relates to Foxconn," Fitzgerald said.

Fitzgerald said he is hopeful the Joint Finance Committee will meet later this month. It would be a "last resort" for the Senate to take action on the budget on its own, but Fitzgerald said he wouldn't rule it out.
If the Senate did eventually say “screw you”, and go ahead with passing the budget on their own, it would likely differ from what the Assembly would come up with, leading to a Conference Committee, and even more delays.

With the budget, you’re seeing where the GOP’s promises to multiple puppetmasters are landing them in a pickle. The $239 million-a-year exemption for the personal property tax is something that the GOP promised for the oligarchs at Wisconsin Manufacturers and Commerce, but Fitzgerald and Gov Walker have previously ruled out tax increases to fix the roads because they don’t want to get on the wrong side of the Kochs and DC lobbyist Grover Norquist. But cutbacks on road projects will put the GOP on the bad side of the Road Builders, so instead the Senate GOP wanted to borrow into oblivion in their budget, which is something that the Vos and the rest of the Assembly GOP don’t want.

And some of those puppetmasters are clearly counting on the Fox-con as well, no matter what damage it does to the rest of the state. Look at what happened when Fitz decided to go on Mark Belling's radio show to explain himself this afternoon.

Followed very quickly by this.

Something really stinks with those 2 statements. That was clearly a hit job being carried out by Belling, and it makes me wonder who would hand out the "hell to pay" if WisGOP doesn't get the Fox-con into law by Labor Day. And which GOP donor/cronies/politicians stand to get massive kickbacks from the Fox-con? You know there are some of them, just who and why is what we need to find out.

It's not like Wisconsinites with real jobs and lives are falling for the Fox-con, as shown by these awful numbers from a PPP poll that was done last weekend.

Poll answers from Wisconsinites, August 2017
Fast-track Foxconn package? 24% yes, 69% no
Change enviro protections for Foxconn? 25-68
Do you believe Walker’s claim that environment will be protected? 33-57

In addition to Wisconsinites’ desire to go “slow and smart” on the Fox-con, the budget mess and the arrogance and cynicism of the WisGOPs in charge seems to be ticking off an increasing number of people.

Do you approve of Wis Legislature? 33% yes, 51% no
Do you approve of Gov Walker’s performance? 41% yes, 53% no

I guess that explains why Scotty Walker and Scotty Fitzgerald and other right-wingers are going into the cocoon of right-wing GOPper-ganda in the last few days to try to hang on to the dwindling amount of supporters that the Fox-con has. They always do this when they can't win the argument on merit.

Regardless of the wants to Walker and Robbin' Vos, the dual messes of the state budget and the Fox-con don’t look like they will be resolved any time soon. Even while Assembly leaders planned a full floor vote for next week, a committee meeting that was supposed to happen tomorrow has been pushed back to next week to look at more ways the Fox-con can be made more palatable. On the other side, the state’s Joint Finance Committee hasn’t met to discuss the budget for over a month, and no meetings seem to be slated for next week.

Maybe these WisGOP “leaders” need to head to the sidelines for a while and maybe we should put some people in charge that actually will deal with the needs of the real world, and not wreck the state’s finances through giveaways to donors and other selfish interests. Just a thought.

Tuesday, August 8, 2017

LFB and Foxconn pt. 2- Best case, the jobs still won't be worth it

This afternoon, the Legislative Fiscal Bureau gave their 28-page analysis of the Foxconn package, including economic benefits and the taxpayer costs associated with the intiatives over the coming decades. Compared to my last post, where I discussed the cost side, I want to talk about the jobs side here.

To come up with a net cost and payback period, the LFB uses the Wisconsin Department of Revenue’s jobs scenario, which includes the best-case situation of 13,000 jobs added and kept at the Foxconn facility starting in 2021. The LFB also assumes increased economic activity, which gives a payback in increased state tax revenues.
The estimates assume that the project will require an average annual employment of approximately 10,200 construction workers and equipment suppliers earning an average total compensation of approximately $59,600 (including benefits) per year during the four-year construction period (from 2018 through 2021). Total income for these individuals is estimated at $2.4 billion. In addition, it is assumed that nearly 6,000 indirect and induced jobs will be created during the construction period, with an average total compensation of $48,900.

It is estimated that the additional construction-period jobs would generate increased state tax revenues (primarily income and sales taxes) equal to approximately 6.3% of the additional gross wages. The total increased state taxes associated with the construction period are estimated at $186.9 million.

As noted, permanent staff at the Foxconn facility are estimated to increase from about 1,000 in the second half of 2017 to 13,000 beginning in calendar year 2021. The average annual wage for these employees is estimated at $53,875, based on a headcount distribution, by job type, provided to EY by Foxconn and median wages for each occupation from the Economic Research Institute. Total ongoing payroll at the company is projected to be $13.8 million for the remainder of this year and increase to approximately $700 million annually beginning in 2021. State tax revenues associated with the additional employees and wages are estimated to increase from about $900,000 this year to $44 million annually beginning in 2021.

Indirect and induced jobs associated with the project are estimated to total 22,000 beginning in 2021, based on a multiplier of 2.7. Average annual wages for these individuals are estimated at approximately $51,000. Total ongoing wages are estimated at $1.12 billion annually, and related state taxes are estimated at $71 million per year. Smaller impacts are estimated in calendar years 2017 through 2020 as the project ramps up.
But even with all of those positive economic impacts, the LFB says the huge cost of the Fox-con means that it would take 25 years to get back to a break-even point.

We should also be skeptical that there will be 13,000 jobs at Foxconn and 22,000 additional indirect jobs, starting with the assumption that headcount will stay at 13,000 for 20+ years after the Foxconn campus is opened (remember that Chairman Gou himself said originally it would be 3,000) and consumer tastes change over time. If the 13,000 jobs do not materialize, the lower headcount will reduce the amount of the $1.5 billion jobs credits that are ultimately handed out (assuming total salaries are lower), but it also will lower the $115 million a year in extra tax revenues that the LFB estimates would come in if the rosy jobs scenario will come to pass. That lack of extra tax revenue would make it near impossible to dig out of the $1 billion hole Wisconsin taxpayers would be in for this project by 2026.

On top of that, State Rep. Mark Spreitzer (D-Beloit) rightfully asks "Why would Foxconn stop at $3 billion?"

Another thing the LFB doesn’t take into consideration is the possibility the Fox-con may hinder economic activity in other parts of Wisconsin's economy. The Foxconn development could lead to displacement of other construction that would have happened in the area, and the environmental degradation could make parts of Southeastern Wisconsin undesirable in the process. And if the labor force shrinks in other parts of the state to take Foxconn jobs, what happens to employers and businesses in that part of the state? Does their economic activity decline because some of that is funneled off to Foxconn?

And even though the yearly price tag goes down once the FoxConn facility is opened and the capital expense credits are written off, we are still tied up with several years in the near future that state government will have to operate at significantly lower funds that will have to be made up for in some way. Explain to me how the state is going to be able to pay for services and other investments around the state when we have less money to go around? The obvious answer is “It won’t,” which means significant budget cuts and/or higher taxes in other areas.

Not only will budget cuts and higher taxes on real people hurt Wisconsin's economy, but if the schools, infrastructure and quality of life suffer throughout the state because funding has been diverted to Foxconn, what is going to make people want to locate to Wisconsin to raise their families in the future? Even under the Walker Administration's rosy scenario, the Fox-con can only work long-term if it encourages people to locate to the state and grow the economy in a manner that otherwise would not have happened. Instead, Walker and WisGOP’s lack of investments in other key areas will likely limit any positive economic impact Foxconn may have.

So no, I don't see where the Fox-con will lead to major stimulative growth, and it could even take away from other areas in the state that would have otherwise succeeded. And from a fiscal side, it certainly isn't worth it, and might lead to cuts that slow things down instead of speed it up. There are many other ways that the state can spend less money than the Fox-con, get more bang for the buck, and not degrade the state's quality of life in the process.


Foxcon costs keep rising- over $600 mil in next budget

You may have seen reports like this one that came out today, which discuss state agencies releasing their fiscal reports for the Foxconn incentive package.
Foxconn’s state tax credits would max out at $312.4 million annually from 2023 to 2026 before tailing off, according to a Department of Revenue analysis of the $3 billion special session bill now before lawmakers.

The agency’s projections show Foxconn would get more than 40 percent of the nearly $3 billion in state tax breaks over that four-year period if it builds a planned $10 billion facility in Wisconsin and hits 13,000 employees.

The Taiwanese electronics manufacturer is in line for $1.5 billion in payroll credits for $9.5 billion in payroll over 16 years plus $1.35 billion for capital expenditures projected to be $10.7 billion over five years, according to an agency analysis on the package’s fiscal impact.
That Wispolitics story gets the topline numbers correct, and most media analysis has fallen along those lines. But it fails to mention that the price tag in the short term could be even higher than that before we hit 2023.

If you go inside the Department of Revenue’s analysis (which deals with the tax writeoff part of the Foxconn package), you’ll see a few other details that aren’t mentioned in the Wispolitics article, and a few other items that are worthy of deeper discussion.

1. Given the structure of the Foxconn incentives, up to $1.5 billion of the $3 billion in writeoffs could come through construction of the campus's buildings and related activities, and would come in two forms. The first is a 15% credit for all “significant capital expenditures” in the new Foxconn enterprise zone. The DOR estimates that the tax credits for Foxconn will start to be submitted in Fiscal Year 2019-2020, reflecting construction in 2018 and 2019, and that Foxconn would take $192.85 million a year in each of the next 7 years (keep that assumption in mind).

In addition, the Foxconn package has an additional write-off for sales taxes on building materials, supplies and equipment that would be part of the construction of the Foxconn facility. The DOR estimates this to total $139 million over the 4 years spent building the facility. Using the construction expense schedule in the DOR’s document, the breakdown by year would be roughly 10% in Calendar Years 2018, 40% in 2019 and 2020, and the last 10% in 2021. This means that around 70% of this sales tax exemption would happen during the 2019-2021 budget cycle, which comes to $97.3 million for that time period.

As a side note, in the Legislative Fiscal Bureau’s analysis of the deal, they say the net effect of the sales tax exemption on the state’s bottom line is $0, because it’s specifically for the Foxconn development, and if it doesn’t happen, there’s no writeoff to be had. But for now, I am looking at the total amount the state is paying toward the development, so we’ll leave that total in there (and the LFB would definitely count the cost if you were putting up a new building at UW-Madison, so what's the difference if we're giving a tax break for certain activities related to other subsidized construction).

2. For the jobs part, the DOR goes along with the Walker spin of “13,000 jobs at $53,000+ average” once the Foxconn facility is fully running. But it takes a while to get there.

Estimated Foxconn-related employment at $53,000 average salary
2017 256
2018 2,600
2019 6,500
2020 10,400
2021 and beyond 13,000

My guess is that the earlier jobs are managerial oversight and the plan would be to slowly work in the number of Foxconn hiring until all the materials and infrastructure are set and ready to go. What this will have the effect of doing is delaying the full effect of this jobs credit until 2023- out of the range of the 2019-21 budget. But there still would be plenty of money handed out in those 2 years - $23.8 million in 2019-20 and $59.5 million in 2020-21.

3. In addition to the Foxconn enterprise zone, the bill creates a new targeted giveaway to Brookfield’s Fiserv Corporation, to try to make sure they keep their headquarters in the Milwaukee area. That would be $2 million a year in the next budget (up to $10 million over 5 years). Also, the bill allows for another 5 enterprise zones to be created throughout the state, which would raise the amount paid out by all enterprise zones by $24.75 million in the 2019-21 budget (the LFB and DOR do not say where those sites are).

4. In addition, the state’s General Fund would pay the additional work on I-94 south of Milwaukee, and LFB describes the payoff schedule this way.
It is expected that, if partially issued in May, 2018, estimated debt service on the $252,400,000 in contingent GPR-supported bonds that would be provided under the bill would increase by $2,942,000 GPR in 2018-19. If fully issued, estimated general fund-supported debt service payments on these bonds would increase to $8.91 million GPR in 2019-20, $15.67 million GPR in 2020-21, and $19.5 million in 2021-22, before plateauing at $20.3 million in 2022-23 through 2037-38. Debt service on these bonds would begin to decline in 2038-39 and would be fully repaid by 2042. Total estimated debt service during this period would be equal to $408.3 million. These estimates and the repayment schedule assume a 5% interest rate and 20-year bond maturities.
So add another $24.6 million to the bill for the 2019-21 budget, and let’s add it up for the 2019-21 budget for the Foxconn project, based on these estimates from the DOR.

Capital expenditures $385.7 million
Sales tax exemption $97.3 million
Jobs exemption $82.3 million
FiServ, other new enterprise zones $28.75 million
I-94 debt service $24.6 million
TOTAL COSTS 2019-21 $618.65 MILLION

Even scarier is that this cost could go even higher than that, and if anything, Walker's DOR is soft-pedaling what could happen as the Foxconn facility is being built. There is no mention of limitations on tax credits for either capital expenses or job write-offs in a given year. It gives time limits of 15 years for the jobs tax credit and 7 years for the capital expenditures credit. But it doesn’t give limits on how much can be taken in a given year, outside of the total amount Foxconn can get.
(a) The corporation may not issue certifications to claim tax benefits under [Foxconn jobs tax credit] that total more than $1,500,000,000.

(b) The corporation may not issue certifications to claim tax benefits under [capital expenditures] that total more than $1,350,000,000.
That makes DOR’s assumption that Foxconn would spread these credits out over the maximum amount of years very risky. What’s stopping from Foxconn from taking all of the $1.35 billion that it can write off as soon as it can, which would be by 2022 or 2023 (if we assume the campus is basically done by 2021)? This would make the hole in the 2019-21 and 2021-23 budgets even larger than DOR's analysis assumes.

Now maybe the Foxconn gamble pays off, and there ends up being enough added jobs and population to make this massive giveaway pay off in the long run (I’ll talk about that part and the LFB’s predictions on it in a future post). But it seems more likely to me that the Fox-con would send a state that already has a $1 billion structural deficit for the 2019-21 budget closer to a fiscal crisis, which could lead to job-limiting austerity in much of the rest Wisconsin. That's before we even account for the likelihood of some kind of recession hitting in the next 4 years, which would drive the deficit even higher.

The more we learn, the more we see that this Fox-con isn’t worth the large price that much of the state will have to pay. It doesn’t work fiscally, and people who care about Wisconsin's future should JUST SAY NO unless the near-term price tag is massively reduced. And even then, it's still an iffy proposition at best.