Tuesday, October 31, 2017

Just in time for GOP tax reveal- let's look at our current tax rates!

Given that Republicans are scheduled to finally reveal actual details of their tax plan tomorrow, I wanted to go over where we are now when it comes to individual tax rates, and some of the possible changes in light of today's situation.

And the timing is interesting, since the new inflation-adjusted tax brackets for 2018 came out in the last couple of weeks. Kelly Phillips at Forbes has a good rundown of the changes, and the article also includes easy-to-understand charts like this.

Those are good charts to keep in mind, as we still don't know where the Trump/Ryan plans would have their tax brackets cut off, nor do we know how many of the 7 brackets would remain. The original Trump/Ryan framework that came out in late September said there would be only 3 brackets, at 12%, 25% and 35%, but the man with Wisconsin's most punchable face said a couple of weeks ago that there should be a 4th, higher rate for the richest people.

Another part of the "Tax reform" framework involved increasing the standard deduction, which theoretically could make up for the end of some individual deductions. Interestingly, Phillips notes that even if nothing gets passed, the standard deduction is going up in 2018.
The standard deduction for single taxpayers and married couples filing separately is $6,500 in 2018, up from $6,350 in 2017; for married couples filing jointly, the standard deduction is $13,000, up from $12,700 in the prior year; and for heads of households, the standard deduction is $9,550 for 2018, up from $9,350.

Another question with the GOP tax package is whether the personal exemption will stay, or if it'll be removed to make up for the larger standard deduction. That's quite a big deal, since the personal exemption is also significant.
The personal exemption amount for 2018 is $4,150. However, the exemption is subject to a phase-out for married taxpayers with an adjusted gross income (AGI) beginning at $266,700 ($320,000 for married couples filing jointly) and phasing out completely at $389,200 ($442,500 for married couples filing jointly).
Here's another different threshold for 2018, one which affects yours truly and a number of others who went back for more education and furthered our incomes.
Student Loan Interest Deduction. For 2018, the maximum amount that you can take as a deduction for interest paid on student loans remains at $2,500. Phaseouts apply for taxpayers with modified adjusted gross income (MAGI) in excess of $65,000 ($135,000 for joint returns) and is completely phased out for taxpayers with modified adjusted gross income (MAGI) of $80,000 or more ($165,000 or more for joint returns).
Keep in mind that the student loan interest deduction is among those that may be taken away in the GOP's "tax reform", and you can see that it would only affect people in the upper middle-class or below. And it would be far from the only "reform" that would end up raising taxing on certain Americans. The largest of those potential raises comes from the proposed framework's plan to get rid of the State and Local Tax (SALT) deduction.

Apparently, getting rid of SALT hasn't gone over well, because over last weekend we found out that the GOP plan will have at least one major change from its original framework. House Ways and Means Committee Chair Kevin Brady said that the GOP now plans to allow property taxes to be written off under the updated tax plan.
Brady's concession on property taxes may help some of the moderate-income people who benefit from the deduction today.

The majority of the SALT deductions claimed by those who make less than $50,000 come from property taxes, according to a report from the Government Finance Officers Association. By contrast more than 70% of the SALT deductions from those making more than $200,000 are due to income.

But it's not clear from Brady's statement if there would be any limits on who may take the property tax deduction. For instance, if it's available only to people who itemize, then chances are many wouldn't take it. That's because his bill would nearly double the standard deduction. And that would drastically reduce the number of itemizers, since you only itemize if your deductions combined exceed your standard deduction.
That standardized deduction would go to $24,000 for taxpayers filing jointly and $12,000 for single filers.

Which yet again means that we need to be able to see an actual bill before we can figure out where all of these parts fit together. Given how the Republicans continue to put back in the most popular deductions, it leads me to wonder where they’re going to find the money to keep the deficit from blowing sky-high with this scam plan.

And if GOPs claim that "economic growth" coming from our already full-employment and aging country is the answer to fill in those revenue gaps? Republican Ben Stein would like to remind you that it isn't true.

Even Racine County residents are recognizing the scam of the Fox-con

We are just over a week away from a potential vote by the WEDC Board to sign off on the state's agreement with Foxconn, and the longer the deliberations go on, the more it becomes obvious that there are a lot of problems with this massive handout. And that's even becoming obvious in the corner of SE Wisconsin where the massive plant is supposed to be built.

Madison-based writer Lawrence Tabak went down to Racine County to see what the locals were saying about the Foxconn development, and his first stop was at the Apple Holler orchard in Sturtevant. There he met Gail Knapp, who works at the orchard and has lived in the area for several years, and she says that the Fox-con isn’t going over as well as Milwaukee corporate media wants us to believe.
“We all hate it, the neighbors around here especially. All the local two-lane roads are going to be expanded to four lanes. Taxes are going to go up and there’ll be no benefits for us for at least 20 years,” says Knapp. “And in 20 years the technology could be so different. In 20 years they could be gone. In the meantime, they’re not going to be hiring locals. They can’t even get enough people to staff Amazon.”

The mention of Amazon points to another Wisconsin issue, in which employers are finding it challenging to fill low-wage jobs. The nearby Amazon distribution center, opened in 2015, is currently advertising multiple positions paying $12.25 to 13.25 an hour. For many struggling Wisconsinites, a low-wage job would mean the loss of government benefits, leaving them in a worse financial situation, not a better one.

But Knapp also believes that, even if they could, Foxconn doesn’t intend to hire locals. With an expression of the proud possessor of inside information she lowers her voice and says that her two sons work construction and that their company is currently bidding on an excavation project. “They’re putting in a housing complex, an entire village, for the Chinese.” Meanwhile, she says, a neighbor down the road just a short distance outside of the Foxconn industrial quadrant has been approached to sell land for a condo project. If Foxconn’s past behavior is any indication, the additional housing is presumably for mid-career engineers from Asia who demand less than the average starting salary available to a fresh University of Wisconsin engineering graduate.

Yeah, this isn't going to turn things around.

Tabak also observes and speaks to many local people who have received eminent domain letters allowing the state to take over their land as long as they receive “fair market value.” In addition to the obvious disruption of having to move before they wanted to, there’s a legitimate question about how much these homeowners are going to get, and who is deciding that amount.

So if the wages suck and there is going to be a large amount of displacement, then just who IS going to be helped by the Fox-con? Tabak’s answer should not be a shock- a handful of corporations and the GOP political machine that they pay off. And they’re being backed up by millions in taxpayer-funded write-offs and infrastructure. One of Tabak’s examples comes from Pitts and Brothers real estate, whose owners gave sizable donations to Assembly Republicans in 2016.
Gov. Scott Walker has promised that the Foxconn development will benefit all Wisconsinites. What is certainly true is how the benefits are already reaching north, deep into Milwaukee, where most of the first round of contractors are based. For instance, should Pitts & Brothers get contracts on most of the farmland, they will be seeing a windfall of some $5,000,000 in commissions. Keep in mind that the basic source of the money to purchase land and pay contractors is the village and county’s bond issuance, which will raise money now on the promise of payback in future property tax levies on the Foxconn complex. It’s public funding. For the 30-year life of the Tax Increment Financing (TIF) deal, all property tax revenue in excess of current collections will flow not to the municipalities, but to the TIF, producing a multi-million-dollar discretionary fund under the direction of Mt. Pleasant and Racine County. In order to float such a massive fund, the Foxconn TIF had to receive special legislative authorization, since state law had previously limited TIF funding to 12% of the assessed value of the municipality, a figure which would have limited the Foxconn TIF to about half of its announced value.

Mt. Pleasant, population 26,000, has already committed $20,000 a month for a project manager from the Milwaukee construction outfit, Kapur & Associates. The firm’s founder, Ramesh Kapur, gave the maximum personal contribution of $10,000 to Gov. Walker in 2010; other Kapur associates kicked in at least $6,000.

Kapur’s project manager will present a list of contractors for approval to the Mt. Pleasant Board of Supervisors, which is headed by Village President Dave DeGroot, self-identified with the Tea Party and politically aligned with the Walker camp. Despite DeGroot’s campaign slogan of transparency, he has become known for announcing or changing public meeting times at the last minute, conducting major business such as the Foxconn deal and the hiring of the project manager behind closed doors, and championing one of the largest local government-sponsored business initiatives in American history, the $764 million Foxconn TIF deal. It’s certainly the largest on a per capita basis, with a debt of $3,800 for each person in Racine County, with the 26,000 residents of Mt. Pleasant at particular risk.
And some people are shameless lucky enough to be hooked up with both the business and political side of Foxconn’s development, as One Wisconsin Now reminded us as the Fox-con was being debated in the Legislature.
Any doubt campaign politics is the driving force behind Gov. Scott Walker gambling $3 billion on a subsidy for Taiwanese electronics manufacturer Foxconn has been dispelled by the creation of a single job. According to a report from Wispolitics.com, the lobbying firm hired by Foxconn has brought on Keith Gilkes, Walker’s longtime campaign manager and the head of the Unintimidated PAC that supported his presidential ambitions, to do “public affairs and communications.”…

Campaign finance reports for Walker’s gubernatorial campaign show he has paid the consulting firm run by Gilkes nearly $90,000 in just the first six months of 2017. Between Walker’s campaigns and the Republican Party of Wisconsin, Gilkes has been paid hundreds of thousands of dollars for his work on Walker’s 2010, 2012 and 2014 gubernatorial elections and as the head of the PAC supporting Walker’s failed run for President.
And hey, look at who was just announced as a key member of Scott Walker’s 2018 re-election campaign, along with the typical group of old-money Milwaukee oligarchs!
Keith Gilkes, who has managed or overseen all of the governor’s successful races – including his historic 2012 recall victory – will again serve as General Consultant. Gilkes is founder of political consulting firm The Champion Group and president and CEO of Platform Communications.

Good for them. Not for you.

The grift and the revolving door never stops with these guys, does it?

I also noted real estate mogul Jon Hammes is back on the Walker crew, you don’t think that guy and some fellow asset-flipping slime are looking to get a nice payoff with the Fox-con, are they? After all, it looks like Hammes anticipated a nice kickback from the taxpayer-funded Bucks arena, so why wouldn’t he want the same from the Fox-con?

The more you know about the Fox-con, the more of an obvious scam it appears to be. This is true whether you look at it in terms of Wisconsin taxpayers improving their job prospects, or in getting their tax dollars back from the WEDC slush fund that will hand them out. We deserve a voice in this, and an ability to read the fine print before we sign it all away.

But that’s not what Fitzwalkerstanis or their corporate cronies believe in, and all we can do is remove these crooks ASAP, before they mess things up beyond the point of repair or recovery.

Monday, October 30, 2017

Trump Campaign indictments are a simple "follow the money" story

Well, today was interesting, wasn't it? Let me give a few observations.

First of all, in the Manafort and Gates indictments, the real keys that connect back to the Trump Administration and Russian influence aren't at the topline, but come in later in the federal criminal complaint. Both Manafort and Gates sent letters to the US Department of Justice in November 2016 and Feburuary 2017 claiming that they were not working for two foreign companies, and “had merely served as a means of introduction of Company A and Company B" to the European Centre for a Modern Ukraine- a pro-Putin front group.

Instead, the US government alleges Manafort and Gates were main participants in this effort, and also
…communicated directly with United States officials in connection with this work; and paid the lobbying firms over $2 million from offshore accounts they controlled, among other things. In addition, court-authorized searches of MANAFORT and GATES’ DMI email accounts and MANAFORT’s Virginia residence in July 2017 revealed numerous documents, including documents related to lobbying, which were more than thirty-days old at the time of the November 2016 letter to the Department of Justice.
Gee, why would they lie about working with pro-Putin front groups to lobby the newly-installed Trump Administration? And as a side note, remember this note about our Fair Governor?

Let's keep that one in mind as this develops, shall we?

Manafort is also accused of “funnel[ing] millions of dollars in payments into foreign nominee companies and bank accounts, opened by them and their accomplices in nominee names and in various foreign counntries, including Cyprus, Saint Vincent & the Grenadines (Grenadines) and the Seychelles.” Why does that matter? Let’s go back to March and this article in the Guardian.
Wilbur Ross, the Trump administration’s new commerce secretary, presided over a deal with a Russian businessman with ties to Vladimir Putin while serving in his previous role as vice-chairman of the Bank of Cyprus.

The transaction raises questions about Ross’s tenure at the Cypriot bank and his ties to politically connected Russian oligarchs. It comes amid confirmation by the FBI that it is investigating possible collusion between the Trump campaign and Moscow to influence the outcome of the presidential election.

In 2015, while he served as vice-chairman of the Bank of Cyprus, the bank’s Russia-based businesses were sold to a Russian banker and consultant, Artem Avetisyan, who had ties to both the Russian president and Russia’s largest bank, Sberbank. At the time, Sberbank was under US and EU sanctions following Russia’s annexation of Crimea. Avetisyan had earlier been selected by Putin to head a new business branch of the Russian president’s strategic initiative agency, which was tasked with improving business and government ties.
The criminal complaint says Manafort and Gates were laundering money through Cyprus from 2008 to 2013. This predates Ross’s purchase of the bank in 2014, but it’s noteworthy that Ross worked with Russian oligarch Viktor Vekselberg when he ran the Bank of Cyprus, as David Corn described last December in Mother Jones.

Now add in the guilty plea of Trump advisor George Papadopolous after getting caught lying to investigators about being part of the Trump Administration when he met with Russian officials to try to get dirt on Hillary Clinton and Democrats. You know what Papadopolous's role with Trump's campaign was? Let's allow Trump himself to tell you, as part of his interview with the Washington Post editorial board in March 2016.
TRUMP: Well, I hadn’t thought of doing it, but if you want I can give you some of the names… Walid Phares, who you probably know, PhD, adviser to the House of Representatives caucus, and counter-terrorism expert; Carter Page, PhD; George Papadopoulos, he’s an energy and oil consultant, excellent guy; the Honorable Joe Schmitz, [former] inspector general at the Department of Defense; [retired] Lt. Gen. Keith Kellogg; and I have quite a few more. But that’s a group of some of the people that we are dealing with. We have many other people in different aspects of what we do, but that’s a representative group.

Much like as we saw with Scott Walker's John Doe case in Wisconsin, this is an easy "follow the money" situation, as it often is when we talk about corruption. And it's pretty obvious that the Russians and Ukranians wanted to get sanctions removed and felt they could get a whole lot back from these amoral mokes in TrumpWorld, so they used their pay-to-play status to get a foothold into the Trump campaign and the Trump Administration.

Now it's simply a matter of finding who knew about the pay-for-play, and what was being offered by both sides. And because the WMC-bought crooks at the Wisconsin Supreme Court aren't "judging" this case, today's
events are only the first shoes to drop, and there will be much more as the connections become more obvious.

Sunday, October 29, 2017

3rd Quarter GDP good, but no game-changer

I was thinking Friday's first release of 3rd Quarter real GDP might be mediocre, especially in light of the heavy storms of August and September and some tepid consumer spending figures. But we got a surprise to the upside instead.
The U.S. economy unexpectedly maintained a brisk pace of growth in the third quarter as an increase in inventory investment and a smaller trade deficit offset a hurricane-related slowdown in consumer spending and a decline in construction.

Gross domestic product increased at a 3.0 percent annual rate in the July-September period after expanding at a 3.1 percent pace in the second quarter, the Commerce Department said on Friday…

Economists polled by Reuters had forecast the economy growing at a 2.5 percent pace in the third quarter. Excluding inventory investment, the economy grew at a 2.3 percent rate, slowing from the second quarter's 2.9 percent pace.
This is the first time in 3 years that we’ve had 2 straight quarters of 3% growth. So let’s look at the GDP report and see where it came from.

As the article hints, a lot of it was due to the inventory growth, as the economy’s actual final sales were the lowest of the 3 quarters of 2017. This graph from Econbrowser showcases how most segments outside of residential construction grew in relatively small but steady ways between July and September.

Interestingly, rising inflation did pull down growth a bit.
Current-dollar GDP increased 5.2 percent, or $245.5 billion, in the third quarter to a level of $19,495.5 billion. In the second quarter, current-dollar GDP increased 4.1 percent, or $192.3 billion (table 1 and table 3).

The price index for gross domestic purchases increased 1.8 percent in the third quarter, compared with an increase of 0.9 percent in the second quarter (table 4). The PCE price index increased 1.5 percent, compared with an increase of 0.3 percent. Excluding food and energy prices, the PCE price index increased 1.3 percent, compared with an increase of 0.9 percent.
I suppose that makes the figures a little more impressive, although I doubt you’re getting a nominal bump of 5% in total pay or quality of life these days.

Bottom line, we are still in the realm of the steady and decent growth that we have been in for most of the 8 years of the Obama Recovery. And the recent resumption of low unemployment claims after some hurricane-related spikes seems to indicate we won’t go into recession very soon.

The concerns I see are the declining rate of job growth over the last year (indicating we may be maxing out in our aging country) and a decline in real wages for the last 2 months. But that’s a gradual adjustment that likely wouldn’t cause a sudden economic decline that should make you panic.

What should concern us is the possibility of the senile fool in the White House and Koched-up GOP slugs in Congress making disastrous decisions on taxes and health care that would put our already crippling inequality on steroids. If that happens in the next few months, then we will are likely to lose our cruising altitude a lot faster than we are currently slated to do.

Saturday, October 28, 2017

In Wisconsin, Air BnB's helping, but big-box retailers are taking

Because I am a budget and policy geek, this little bit of data raised my eyebrows.
Taxes collected by Airbnb for the first three months under an agreement with the state of Wisconsin has far exceeded expectations, company officials said.

Airbnb sent about $550,000 in tax revenue for July, August and September to the Wisconsin Department of Revenue, a number Airbnb said "dwarfed even the most aggressive initial projections."

When the deal with the state was announced in June, the Department of Revenue said if the agreement had been in place for all of 2016, the state would have gotten about $700,000.

The agreement calls for Airbnb to collect sales taxes, use taxes and local resort/exposition taxes on behalf of the home owners in the Airbnb system.
Which puts an interesting light onto the 1st Quarter of Wisconsin State Revenues for Fiscal Year 2018, which was released last Friday. The topline numbers were a bit below projections, although not enough to be alarmed about (yet), but sales taxes were only up 1.6% even with the bump in Air BnB remissions.

Granted, we’re only talking about $375,000 extra or so out of $884 million in sales taxes for those three months, but it does underscore consumer weakness in other parts of the state’s economy. And we didn’t have the hurricanes to hold back spending like there was in other segments of America in those months. Could be worth keeping an eye on.

Another item to keep an eye on is how Wisconsin businesses are increasingly able to get favorable court decisions on property assessments, which will likely mean higher taxes for homeowners. Lou Kaye at Rock Netroots has a good list of nearly $850,000 that has been paid back so far this year in Janesville (including a combined $730,000 to Blain’s Farm and Fleet and Menard’s). And as a Madison homeowner, seeing this story today didn’t make me feel great.
After getting new information, Madison is cutting millions of dollars — and in five cases, more than $10 million — from the assessments of hotels that saw huge increases in property values this year.

After initial assessments were announced in April, city officials had said hotels and big apartment buildings had been undervalued and that increases were appropriate and warranted….

The latest changes will add $9.67 to the tax bill for the average home for next year, bringing the increase to $75.60 and the total bill to $2,493.19. Madison’s average home is valued at $269,377. The city’s Finance Committee approved a $314.3 million operating budget on Monday, and the City Council will make final budget decisions the week of Nov. 13….

Overall, “it shows we were on the right track,” city assessor Mark Hanson said. “We knew this class of property needed some adjustment. They hadn’t been looked at since the recession.”

The hotel assessments initially came in far too high because assessors had to rely on assumptions based on available occupancy and room rates and didn’t have actual income and expense information, Hanson said. In the appeal process, hotels provided actual data, he said.
In all, 26 hotels got a total of $97 million knocked off of their assessments, and that means that homeowners make up more of the total tax base, which is why I’ll be paying that extra $10. It helps when you’re a company with big dollars, and the ability to have the time, effort and money to get information to lawyers who can make the City back down and lower your bill.

Which led me back to wondering where the State Legislature was in discussing the “dark store” bill that has been introduced in both houses with numerous sponsors from both parties. This legislation would keep companies like Menard’s and Farm and Fleet from having their property taxes drastically lowered by basing their assessed values on empty stores instead of the active ones in use, and keep homeowners from getting jacked in the process.

Huh, doesn't look empty.

I’m glad to report that the Senate bill for dark stores made it unanimously out of committee earlier this month, and is ready to be voted on by the full Senate. The Assembly dark store bill has had a hearing, but is currently languishing in the Ways and Means Committee - aka the “WMC” Committee. Ironically, Wisconsin Manufacturers and Commerce is actually trying to stop the dark store legislation, apparently because they lack any shame in their greed. And the WMC angle is what makes me wonder if that’s what has kept this bill from a final vote in Robbin’ Vos’s Assembly.

Both the air BnB tax and the dark store bills may seem like small little accounting measures, but they are intriguing changes in policy and they could result in significant impacts on our fiscal situation. It’ll be worth keeping an eye on it as we go into property tax season, and as we get a better idea about what fiscal year 2018 is going to look like.

Friday, October 27, 2017

Weekend reading- Clueless Coastals head to WIsconsin to figure out the 2016 election

Wanted to tell you about a brilliant article that came out this week in The Atlantic by Molly Ball. It’s titled “On Safari in Trump’s America”, where Ball travels to Western Wisconsin to look in on what locals had to say in the aftermath of the November 2016 elections.

Ball goes along with Nancy Hale and a few other members of Third Way, a DC-based think tank that wants “solutions that are not defined by ideological orthodoxy or narrow interests.” Hale was one of the founders Third Way 12 years ago, and their solutions generally involve the calculated, corporate-friendly centrism that defined Bill and Hillary Clinton’s career with a side order of social liberalism and tolerance.

Hillary’s defeat in 2016 to the divisive, race-baiting and policy-thin Donald Trump was a massive jolt to the Third Way crowd. Few places had more of a shift than Western Wisconsin, which went from giving Barack Obama a sizable advantage in 2012 to giving a majority of their votes to Trump in 2016

Ball said that Third Way’s visit to Wisconsin is part of a $20 million effort to figure out why voters in swing areas of the country backed Trump, and what messages they need to hear in order to keep it from happening again.
Open-mindedness was the sworn commitment of the Third Way team. The researchers were determined to approach rural Wisconsin with humility and respect. After the election, Hale told me, “You heard people saying, ‘These people aren’t smart enough to vote, they’re so stupid, if that’s what they want, they deserve what they get.’ That hit us, on every level, as wrong.” They wanted to open their hearts and their minds and simply listen. They were certain that, in doing so, they would find what they believed was true: a bunch of reasonable, thoughtful, patriotic Americans. A nation of people who really wanted to get along.
If you’ve lived in “divide and conquer” Fitzwalkerstan in the 2010s, I think you know that Hale is in for quite the surprise.

They first come across a number of farmers and other “hard workers” in Pierce County. They complain about “leeches” in bureaucracy, a lack of desire among young people to work certain jobs, lament the effect of women working outside of the home, and general dismay at the dead-end life that exists in towns like Ellsworth.

Hale finds this a bit disturbing, but it’s only her first focus group, She then heads off down I-94 to another focus group of workers.
At the Labor Temple Lounge in Eau Claire, nine gruff, tough-looking union men sat around a table. One had the acronym of his guild, the Laborers International Union of North America, tattooed on a bulging bicep. The men pinned the blame for most of their problems squarely on Republicans, from Trump to Governor Scott Walker. School funding, the minimum wage, college debt, income inequality, gerrymandering, health care, union rights: It was all, in their view, the GOP’s fault. A member of the bricklayers’ union lamented Walker’s cuts to public services: “If we can’t help each other,” he said, “what are we, a pack of wolves—we eat the weakest one? It’s shameful.”

But their negativity toward Republicans didn’t translate to rosy feelings for the Democrats, who, they said, too frequently ignored working-class people. And some of the blame, they said, fell on their fellow workers, many of whom supported Republicans against their own interests. “The membership”—the union rank-and-file—“voted for these Republicans because of them damn guns,” a Laborers Union official said. “You cannot push it out of their head. A lot of ‘em loved it when Walker kicked our ass.”
This type of bluntness and bleak outlook concerns Hale and her associated Third Wayers, who want to believe all Americans are rational, decent human beings that are all striving for the same outcomes, and assumes that America’s problems can be solved by reaching some kind of mushy middle-of-the-road consensus that is “good enough” for all parties involved.

The Third Way mentality might make sense if you were financially comfortable and lived in a high-educated, diverse area on the coasts with the prospect of a better tomorrow. In that circumstance, you have enough of a cushion in your life to worry about deeper issues, and can afford to walk away with half a loaf.

But that is not close to the reality for many in the left-behind parts of the Midwest. What finally sends the well-connected Boomer from Cali over the edge is when a café owner in a Viroqua focus group calls into question the entire political game and the limited outcomes that are being considered these days.
The cafe owner—a bearded man in a North Face fleece—had recently attended a town hall held by the local Democratic congressman, Ron Kind, a Third Way stalwart and former chair of the House’s centrist New Democrat Coalition. “I’m not, like, a jumping-up-and-down Berniecrat,” the man said. “But what you see in these congressional meetings is a refusal to even play ball” with ideas considered too extreme, like single-payer health care. “All these centrist ideals,” he said, “are just perpetuating a broken system.”
Hale ends up telling author Ball that it disturbs her that people aren’t willing to work with people that had a different opinion, and that many of the people involved had a “fuck you” mentality to many of those who opposed them. It’s almost like the small-towners didn’t want to debate the great issues of the day, and had been turned off by what America was offering in economic and political outcomes.

Naturally, Hale hides this reality in her final report for Third Way (admit that neoliberal American policy lets middle America down? No way!). Instead she says that us salt-of-the-earth Wisconsinites are turned off by all of the arguing they see (without mentioning the issues being argued about), and ultimately just want to get along.
According to the report, the community’s “biggest frustrations” are “laggard government and partisan squabbling.” “The idea that such bickering can be tolerated in D.C. is appalling to most,” it states. The good people of western Wisconsin, Third Way found, wanted nothing so much as a society where people could put aside their differences. The report quotes a man who said, “We come together on projects and solve problems together.” It doesn’t quote any of the Wisconsinites we met who expressed partisan sentiments or questioned the prospect of consensus.
Ball knows better than that, and gives you the real truth about what people were saying in the Heartland.
In Wisconsin, I had seen and heard everything the Third Way researchers did—and eaten at the same restaurants, and slept at the same Hampton Inn in Eau Claire, and watched the same landscape roll by the windows of the same SUV. I heard all the optimism they did, but I also heard its opposite: that one side was right and that the other was the enemy; that other Americans, not just the government, were to blame for the country’s problems. There’s plenty of fellow-feeling in the heartland for those who want to see it, but there’s plenty of division, too. And not every problem can be solved in a way that splits the difference.
This final note from Ball in the article is especially concerning, because it seems to indicate that the reality of the “Real America” isn’t seeping in to the Coastal elites that define groups like Third Way.
The researchers I rode with had dived into the heart of America with the best of intentions and the openest of minds. They believed that their only goal was to emerge with a better understanding of their country.

And yet the conclusions they drew from what they heard corresponded only roughly to what I heard. Instead, they seemed to revert to their preconceptions, squeezing their findings into the same old mold. It seems possible, if not likely, that all the other delegations of earnest listeners are returning with similarly comforting, selective lessons. If the aim of such tours is to find new ways to bring the country together, or new political messages for a changed electorate, the chances of success seem remote as long as even the sharpest researchers are only capable of seeing what they want to see.
If the DNC and the DPW are wasting time thinking that the key to electoral victory is to follow what well-connected Coastals in their Bubble want to believe, then they won't break the Bubble of destructive right-wing BS that distracts and fools a lot of Midwestern voters that are dealing with real problems.

And last I checked, voters decide elections, not Coastal insiders and party hacks. So maybe we should recognize the realities that voters face and not try to adjust it to what we wish it was. Just a thought.

Here’s another link to Molly Ball’s great article. Read it, and share with your friends.

Thursday, October 26, 2017

Illinois may suck, but sorry Scotty, Wisconsin ain't close to "on fire"

While Wisconsin youth prisons are having uprisings and flaws in the Fox-con are being covered up from the public, our Fair Governor decided to deal with something really important recently.
Gov. Scott Walker, along with fellow Republican governors Eric Greitens of Missouri and Eric Holcomb of Indiana, have cut a television ad for Illinois Gov. Bruce Rauner’s re-election campaign.

In the ad, the three governors thank Illinois House Speaker Mike Madigan, a Democrat, for passing a state budget that includes a dramatic tax increase. Rauner vetoed the spending bill but the state legislature overrode that veto.

The three governors say the troubles in Illinois have created new jobs in Wisconsin, Indiana and Missouri. The ad debuted Tuesday, October 24th.

“Our economy’s on fire…so we owe you,” Walker says. “Cheeseheads love you, Madigan.”
Really Scotty? Sure, we’re definitely doing better than Illinois over the last 3 months- but that’s not because we’re “on fire.” Our job growth has been lame, especially in the private sector, and the real reason we look better is because Illinois has gone down.

Total job change, June 2017 – Sept 2017
All jobs
Wis. +7,300
Ill -12,800

Private Sector
Wis +2,900
Ill -14,700

But that gap is almost entirely due to September’s jobs report, where Illinois lost 10,800 jobs (11,000 private sector) and Wisconsin gained 8,600 (5,900 private sector). It’s a typically sleazy Walker move to cherry-pick and try to BS an out-of-state audience.

Throw out that one-month survey (which could be a seasonally-adjusted fluke), and go back to the 4 months prior to that, and the story is the exact opposite.

Total job change, April 2017- Aug 2017
All jobs
Ill +14,700
Wis. -10,400

Private Sector
Ill +15,500
Wis -4,300

Bottom line is that we both have been sucking, as shown by yesterday's release of the Federal Reserve Bank of Philadelphia’s coincident index of economic activity.

But see that light green state of Minnesota to our west? That’s a place that’s doing pretty well, especially when compared to Scott Walker’s Wisconsin.

Job growth, April 2017-Sept 2017
All jobs
Minn +9,600
Wis. -1,800

Private Sector
Minn +6,600
Wis +2,400

It’s even more the case when you look at the past year.

Job growth, Sept 2016-Sept 2017
All jobs
Minn +52,200
Wis. +34,600

Private Sector
Minn +47,200
Wis +28,800

Hmm, maybe the Minnesota and Wisconsin Dems should team up on ads thanking Scott Walker for driving Wisconsin’s talent off to Minnesota, and helping Minnesota to thrive? And especially play those ads in the Duluth, Minneapolis, and La Crosse markets, where Wisconsin voters can see them.

Once again, Gov Dropout only tries to land a short-term cheap shot to impress low-info rubes, and leaves himself wide open for a haymaker from the big picture. And he wonders why his approval is underwater these days.

Another school year, and more money being sent to vouchers

With the third week in October finishing up, the Wisconsin Department of Public Instruction finalized their allocations for the state's school voucher program. And to no one's surprise, the voucher program keeps getting bigger, and more expensive.
Student enrollment in the various programs is determined by counts that take place on the third Friday in September. Across the three programs, 36,249 students received a voucher to attend one of the 238 participating private schools. This is an increase of 2,684 students and 29 schools across the three programs compared to the prior school year. The 2017-18 enrollment for the three voucher programs is 35,176.0 full-time equivalent (FTE) students, an increase of 2,620.9 FTE from 2016-17. In most cases, one student counts as one FTE. However, in certain cases, the FTE can be less. For example, depending on services provided, a 4-year-old kindergarten (K4) student may be counted as 0.5 FTE or 0.6 FTE.

For the 2017-18 school year, each participating private school may receive a voucher payment of $7,530 per FTE in grades kindergarten through eight and $8,176 per FTE for students enrolled in grades nine through 12. The cost of the three programs combined is estimated at $269.7 million for the 2017-18 school year, which is an increase of about $25.5 million from the prior year.
Actually, that “$25.5 million increase” is based on the budgeted amount in 2016-17. If we go to the actual expenses reported in the state's Annual Fiscal Report, it would be an increase of $28.7 million (11.9%) compared to last year, and $39 million compared to 2 years ago.

The statewide voucher program is one that’s had a significant effect in recent years, as not only did vouchers break out past the Racine and Milwaukee school districts, but it has a direct effect on the amount of aid those public schools receive.
The statewide private school choice program is paid for in two ways, dependent upon when a student first received a voucher. General purpose revenue (GPR) pays for students who first participated in the program prior to 2015-16 on a sum sufficient basis. Incoming pupils, those who first participated in the 2015-16 school year or after, are paid for through a deduction in state aid from the public school district where the student resides.

Incoming pupils in the WPCP are included in the resident public school district’s membership for state general aid purposes, but the district may not levy to backfill the aid reduction. The district instead receives a non-recurring revenue limit exemption, which the school board may include when setting its 2018 school taxes. The exemption is equal to a given district’s reduction in aid.
Another trend that is continuing in 2017-18 is that less than 1 in 6 students receiving vouchers are transferring from public schools.

2016-17 enrollment of 2017-18 voucher students (headcount)
Private School 75.0%
Public School 15.8%
Not in School 5.5%
Homeschooled 3.6%
Out of state 0.1%

And this reveals one of the biggest scams in a voucher program riddled with them. Taxpayers are subsidizing private school students that were already attending the schools, and were already having tuition taken care of (either by the parents of the student or through scholarships/aid from the school). This allows the private school to get an extra source of revenue and an ability to reinvest their tuition/aid funds, a double-gain for these overwhelmingly religious schools.

On the flip side, the local public school gets money TAKEN AWAY FROM IT, even though that voucher student may never have spent a day in a public school classroom in that community. And it’s at a level that is higher than the average amount of state aid per student, while forcing a cut in school spending per student for the local district.

If you look at the stats for which public school districts had the most residents receiving vouchers (and losing state aid in the process), you’ll see a lot of medium-size cities and a couple of Milwaukee suburbs. I am leaving Racine out of this analysis as they are under a different system that allows for more vouchers and higher income levels.

Most students “lost” to vouchers, 2017-18, by FTE
Green Bay 402.50
Kenosha 221.50
Appleton 207.00
West Allis-West Milwaukee 166.40
Oshkosh 147.00
Waukesha 144.60
Sheboygan 141.00
Eau Claire 125.00
Fond du Lac 111.10
Wausau 100.00

An organization called School Funding Reform for Wisconsin has created a nice graphic which shows the State Senate districts having the most tax dollars funneled out of their public schools and into vouchers.

My area isn't losing much. Yours may be very different

I’ll leave out the Racine-area stats again, and not surprisingly, the two senators from Green Bay have the most funds being sent away. But you’ll notice that a whole lot of GOP districts are next on that list.

Total voucher payments, Wis Senate districts, 2017-18
Cowles (R) $4.039 million
Hansen (D) $3.087 million
LeMahieu (R) $2.139 million
Roth (R) $2.130 million
Feyen (R) $1.968 million
Vukmir (R) $1.906 million
Kapenga (R) $1.437 million

Oh, and did you know that other than Feyen (elected with help from Bradley/DeVos voucher money last November), the last 5 Republicans on the list are all up for re-election in 2018? This includes the seat of ALEC Queen Vukmir, who abandoned the 5th district to run for US Senate (fellow voucher whore Dale (Koo-Koo) Kooyenga is trying to replace her).

Interestingly, the areas represented by Roth, LeMahieu and Feyen are right in the heart of Congressman Glenn Grothman’s district. Not only is Grothman publically saying he is in a dogfight to keep his seat in Congress against Dan Kohl next year, but Grothman also backed every voucher expansion this state put in from 2011-2015, and was the lead author of a 2013 budget provision allowing richer Wisconsinites to deduct their private school tuition from their taxes.

Maybe 2018 would be a good time for you in Eastern and Central Wisconsin to pay back Grothman and other WisGOPs for all the money they have stolen away from your public schools and the higher taxes you have had to pay as a result of their Bradley/DeVos-based scam. Just a thought.

Wednesday, October 25, 2017

Bad cops + bad GOP handcuffs = bad Milwaukee budget situation

As local budget season heats up, many are looking at what happens in the City of Milwaukee, where Mayor Tom Barrett has proposed reducing the number of police and fire fighters through attrition. This understandably has many people concerned over staffing levels for emergencies, and whether the City will become less safe as a result. But if you look into the actual reasons behind the fiscal issues, you’ll see that many of the issues are the result of politically-motivated actions and budget cuts at the GOP-controlled State Capitol in Madison, and they either need to step up, or be pushed out in favor of some people who will actually try to improve things for the state’s largest city.

We know that the union-busting Act 10 was bad enough for the state’s economy and ability to attract quality candidates to public service due to the take-home pay cuts and lack of bargaining power. But Bruce Murphy of Urban Milwaukee notes it’s even worse for the City of Milwaukee, because of a Walker/WisGOP loophole that rewarded Milwaukee cops and firefighters for their political support in 2010.
Pretty much every employee of school districts saw their benefits cut and most have lost their collective bargaining rights. But cities were an entirely different story because Walker exempted his political allies, the fire fighters and police, from Act 10. Suddenly all his justifications for the law didn’t apply. That squeezed every city, which had to live with constraints on property tax increases but was still left with rising wages and benefits for police and fire, who continued to use collective bargaining to drive hard bargains.

And no city was more squeezed than Milwaukee, because it is the state’s biggest city, with the most poverty and crime, and the most need for police. And that is part of the back story to the city’s current dilemma, with the Public Policy Forum declaring the Milwaukee’s revenue structure “is broken”, and Barrett proposing a draconian 2018 budget that cuts the number of fire fighters (by 75) and police (by 33). A “primary culprit” for these budget cuts, the PPF concluded in its latest report, “is a spike in the employer pension contribution, which increases from $61 million to $83 million.”

And it’s the police and fire pensions that have caused this spike. Back in 2011, before Act 10 went into effect, police and fire fighters accounted for 62 percent of the cost of the city employee benefits, according to figures provided by the city’s office of budget management. By 2017 they accounted for 70 percent of the cost of city benefits.

This is despite the fact the number of police and fire fighters declined slightly, by four percent, during these six years. Meanwhile the number of other city employees actually grew — by less than one percent. Yet the cost of police and fire benefits ballooned by 50 percent during this period, from $86.8 million to $130.2 million, while the cost of benefits for all other city employees rose by just 3.9 percent, rising from $53.3 million to just $55.4 million.

Meanwhile, Milwaukee Police are costing City taxpayers and squeezing the city budget in another way beyond their rising special benefit costs, as we saw in this Journal-Sentinel article today.
Police misconduct has cost Milwaukee taxpayers at least $17.5 million in legal settlements since 2015, forcing the city to borrow money to make the payouts amid an ever-tightening budget.

That amount jumps to at least $21.4 million when interest paid on the borrowing and fees paid to outside attorneys are factored in, a Milwaukee Journal Sentinel analysis found. …

[A $2 million] pending wrongful imprisonment settlement could push the total payouts to settle lawsuits so far this year to $9.4 million. That would be the most the city has paid out in a single year since at least 2008, according to the Journal Sentinel analysis.

The city is self-insured, meaning taxpayers bear the costs of any settlement.

Because the city only budgets $1.2 million a year for claims and lawsuits, it has resorted to borrowing to pay for the large settlements. Aldermen have approved borrowing $16.3 million to settle four lawsuits, and will soon vote on whether to borrow another $2 million to pay a fifth.
And of course, that borrowing has to be paid back over time, which adds another expense for the city to deal with in future years. As non-PC as this sounds, if bad cops are leading to budget difficulties, then why shouldn’t the Police Department be responsible for some of the cuts that would result?

But the larger problem is the lack of money that’s available for the City to pay these extra bills that come from needing such a large amount of police and fire services. As Milwaukee’s Public Policy Forum mentioned, the State of Wisconsin has continually cut the amount of money it sends back to communities in the form of shared revenues, and this is especially true for Wisconsin’s largest city.
In recent decades, the shared revenue program has diminished in force and focus as ad hoc aid has replaced formula funding methodologies. In 1985, the State eliminated automatic shared revenue aid and in 2001 it discontinued the main components of the funding formula. Since 2004, except for one year, annual funding for shared revenue either has remained essentially the same, or has been reduced. In fact, the combined amount of municipal aid and utility payments declined from $719 million in 2005 to $666 million in 2015, and their share of the State’s general fund budget fell from 13% in 1995 to 6% in 2015.

The drop in shared revenue has had a substantial impact on the City of Milwaukee’s finances. In Making Ends Meet, we noted that if Milwaukee’s intergovernmental revenue (of which shared revenue is by far the largest component) had increased at the rate of inflation from 1995 to 2015, then its revenue total would have been 58% higher ($415 million versus the $264 million it actually received). Property tax increases made up for less than 20% of the inflation-adjusted decline in intergovernmental funds during that time.
And this isn’t going to get much better in the next 2 years. Sure, the recently-signed state budget and had a one-time 8.5% increase in local road aids after being frozen for several years, but it added virtually no money for shared revenues to counties and municipalities for general services,

This can't go on.

And before GOP rubes yap about “the trolley”, Jeremy Jannene of Urban Milwaukee noted that loudmouth Alder Tony Zielinski is talking out his backside when he says he wants to use streetcar money to add more cops.
After spending the last press conference attacking Mayor Tom Barrett and two streetcar-related positions in the budget, Zielinski spent this press conference attacking the mayor and a $315,000 budget allocation from the parking fund to operate the streetcar. The catch? Because of the $10 million, 12-year Potawatomi Hotel & Casino sponsorship deal, these streetcar costs are completely offset by the incoming streetcar sponsorship.

Zielinski will propose amendments to eliminate the streetcar budget items, a move he says will result in only 26, not 33 police officer positions being eliminated. The math on that doesn’t check out though, as eliminating the streetcar-related items would presumably force the project to stop, end the Potawatomi sponsorship and cause the federal government to demand the return of its grant for the streetcar…

What are these streetcar budget items? The budget includes $208,000 for the creation of two positions related to the city’s management of the streetcar. In addition, $315,000 is included that is required as a 20 percent match for a grant provided by the federal government to operate the streetcar.

The city will eventually need to pay $3.6 million a year to private operator Transdev to operate and maintain the streetcar. That cost will be offset by farebox revenue, the federal grant and sponsorships. The city isn’t anticipating a budget impact from the streetcar until at least 2021, some three years after it begins operations (and Barrett has said the city is still seeking other sponsors). The streetcar, now known as The Hop, is scheduled to begin operation in November 2018.
The City budget assumes no funding from the state either, so if you’re bitching about the streetcar’s “costs” and saying it’s causing budget problems in Milwaukee, you are either blatantly dishonest, or you have been SUCKERED.

If suburba-GOPs truly give a damn about making sure Milwaukee has enough funding for police and fire fighters, and they’re not going to send more shared revenues to the City because they’d rather their campaign contributors get another tax cut, then the solution is simple – LET MILWAUKEE RAISE ITS OWN MONEY THROUGH A SALES TAX. I’ve said this before, but Milwaukee County is by far the largest generator of tourism dollars for the State of Wisconsin, with nearly $2 billion in direct visitor spending last year.

People like coming here. So why don't they pay some of the bills?

It makes perfect sense for those visitors to pay back some of the extra costs and needs that they cause for the City they want to visit. Why should residents of Milwaukee have to pay higher taxes to pay for added needs that they didn’t cause? If suburba-GOPs and others in the state won’t allow the handcuffs to be taken off of Milwaukee to pay for the increased fire and police costs that Scott Walker and WisGOP have imposed on them, then it proves that they really do want to wreck the state’s largest city.

And for what? To say your mediocre selves are better than “those people” and score political points with racist rube voters? That strangling mentality is exactly why Milwaukee and Wisconsin continue to lag behind the rest of the country, and will continue to fail as long as Walker and the WisGOPs are in charge. These anti-urban policies and the “we are immune from the problems we cause” mentality from WisGOP have to be ended.

WEDC arrogance sets stage for more unchecked taxpayer theft with Fox-con

You’d think the Wisconsin Economic Development Corporation (WEDC) would be on its best behavior these days. WEDC had a hearing before the Joint Audit Committee this week to see if they had made any progress with their bad track record regarding taxpayer-funded handouts to GOP campaign contributors businesses. The meeting also came as there were a number of open questions lingering about a $3 billion incentive deal the state has with Foxconn, which WEDC is in charge of overseeing and signing a final contract with.

But instead, WEDC decided they didn’t need to answer any of those questions yesterday, and will continue to negotiate the details of the massive deal in secret.
Wisconsin's jobs agency will not alter its policies to make public a contract between the state and Foxconn before the deal is signed, Wisconsin Economic Development Corporation CEO Mark Hogan said Tuesday.

"We won’t be changing our process relative to when the contracts are available," Hogan told members of the Legislature's audit committee. "Any contract that WEDC signs is available to the public (once it is signed)."
Translation- that’s on a “need-to-know” basis, and you don’t need to know.

I happened to be watching some of the Joint Audit Committee meeting while I was racked up with a bit of a cold on Tuesday, and Hogan’s arrogance was obvious. When State Sen. Kathleen Vinehout brought up the recent headlines about millions that state taxpayers lost in a WEDC scam with Kestrel Aircraft in Superior, Hogan basically blew her off and said “That was five years ago, things are different now.”

Stop asking what we're doing with your money

Except that the LAB auditors said that things weren’t that different.
The committee met to discuss an audit released in May that found WEDC had improved its administration of grants, loans and tax credits but still could not accurately measure how many jobs it has created.

WEDC "cannot be certain about the numbers of jobs created or retained as a result of its awards," the nonpartisan Legislative Audit Bureau reported in the biennial review.

State auditor Joe Chrisman said Tuesday the primary areas in which WEDC has not complied with recommendations have been in verification and accuracy.

A member of the Jount Finance Committee noted the damning findings from yesterday.

There’s no way an honest person can defend the WEDC slush fund as a legitimate economic development organization anymore, and the fact that they and WisGOP refuse to reveal what caused the delay in getting the WEDC Board to approve a contract with Foxconn is a massive red flag. For crying out loud, they won’t even allow State Sen. Tim Carpenter to see the proposed contract ahead of time, and he’s one of the WEDC Board members that has to vote it!

Carpenter explained to the Wisconsin State Journal that the proposed WEDC contract could have left taxpayers on the hook for those billions if Foxconn didn’t live up to their end of the bargain.
WEDC board member Sen. Tim Carpenter, D-Milwaukee, declined last week in an interview with the Wisconsin State Journal to disclose details of why a scheduled vote on the contract was delayed. But he told the newspaper the issue was a “nuclear bomb” that would have left taxpayers exposed.

In an interview Tuesday with the State Journal, Carpenter offered more detail, saying Hogan told board members last week that the way the deal was structured the agency couldn’t guarantee it could protect taxpayers if the company violated the agreement.

“We could have given them all this money and we wouldn’t have been able to get it back,” Carpenter said.

If the Fox-con was legitimate, Walker and WEDC would be transparent with the taxpayers (who are paying these incentives), and letting them know the details every step of the way before they become law. In addition, they would allow the Joint Finance Committee the chance to ask questions and potentially change the terms of the incentive deal with Foxconn based on the changes in details that may come from this contract.

But instead, Walker, WEDC, and their WisGOP enablers feel that they are above public accountability, and don’t have to give the public any information about a Fox-con that the public could be left holding an empty bag on. It is a disgusting mentality, and the mark of a crony-driven Banana Republic, instead of a democracy that works for the average citizen.

When it comes to discussing WEDC and the Fox-con, I feel like doing a Joe Biden voice to sum things up.

“Come on folks, these are the same idiots that have lost tens of millions of dollars on deals that didn’t work, they can’t tell you how many jobs have been created, and they can’t tell you what the money went for. Why in the world would you trust them with handing out $3 billion of your tax dollars to a Chinese company with a history of lying about what they’re going to do? It makes absolutely no sense, people!”

Tuesday, October 24, 2017

Lincoln Hills disaster a natural outcome of Act 10, other Walker incompetence

You may recall this Summer that a federal judge ordered staff at the youth prisons at Lincoln Hills and Copper Hills in northern Wisconsin to cut back on the use of pepper spray, shackles and solitary confinement following information about assaults and injuries to prisoners in recent years.

Recently, the violence has been turning the other way at those facilities, including a report out today that 5 staff members at the juvenile prison complex at Lincoln Hills and Copper Hills had to be hospitalized after an uprising over the weekend. Combine that, along with the federal judge ordering an update from the state next month, and Governor Scott Walker decided to spring into action.

In typical Walker fashion, Scotty blamed the court order and the media for the recent violence perpetrated by inmates at these facilities, and ordered Corrections Secretary Jon Litscher to carry out steps to get things under control.
As you are aware, juveniles at CLS/LHS are guilty of the most serious offenses in our criminal justice system. Juveniles who are convicted as adults are housed at CLS/LHS and have committed crimes such as first-degree intentional homicide, first-degree reckless homicide, first-degree reckless injury, second-degree sexual assault, battery, battery to an unborn child, robbery, and possession of a dangerous weapon. Moreover, violent individuals in these institutions have become emboldened following repeated media reports and court-ordered operational changes.

Last week, [Secretary Litscher] provided me with an update of the situation at CLS/LHS, including an update on attacks on staff. Clearly, the men and women who staff these facilities have challenging jobs, and we value their hard work and dedication. To support and further the reforms at CLS/LHS you have implemented, I am requesting that you appoint an interim superintendent of CLS/LHS while the Department completes the recruitment of a new permanent superintendent. I am requesting you select a person, with input from the administrators of the Division of Juvenile Corrections, who has an outstanding set of administrative skills gained by working in the Department. This person selected will work on-site, ensuring the court-imposed changes are met while protecting the safety of staff and juveniles.

We cannot allow individuals convicted of battery, armed robbery, and even murder to feel empowered to attack staff and each other in these institutions. No matter the challenges, we must provide the men and women working in CLS/LHS with the tools they need to maintain order in the facilities and protect themselves and to protect the offenders held at these institutions.

2 quick observations

1. Scott Walker talking about "tools"? That sounds familiar. Keep that code word in mind as we proceed.

2. WE HAVEN'T HAD AN ON-SITE SUPERINTENDENT AT LINCOLN HILLS? That kind of seems like your burying the lead here, isn't it?

It's not like these problems at Lincoln Hills have come out of the blue. Scott Walker's office was lambasted by a Racine County judge for "indifference" about conditions at Lincoln Hills in early 2012, and in late 2015, Wisconsin Chapter of the NAACP asked the State Legislature and Governor Walker for a change in how they handled juvenile corrections.
Responding to the controversy at Lincoln Hill School for Boys, NAACP requested the Ethan Allen School for Boys because of its proximity to Milwaukee. In 2011, the NAACP is aware that in 2011, both the Ethan Allen School for Boys (Wales, WI) and Southern Oaks School for Girls (Union Grove, WI) were closed for budgetary reasons.

The youth were transferred to Lincoln Hills School for Boys and Copper Lake Girls School in Irma, WI over 200 miles north of Milwaukee whereas Union Grove and Wales were just over 30 miles away from Milwaukee. In 2010, over half the youth in the care of WI Department of Corrections – Division of Juvenile Corrections were from Milwaukee.

According to NAACP, by moving the children so far away, the majority of the children’s families had longer distances to travel to visit their loved ones in confinement. If the schools were closer to Milwaukee, it would also make it easier to hire more diverse staff persons and teachers. Additionally, more diverse organizations could interact with the schools to help provide more transparency about the everyday conditions in the schools.

Let's also remember that in 2011, there was another thing that changed circumstances at these centers for juveniles - a little thing called Act 10. This meant that Lincoln Hills and Copper Hills staff had the take-home pay reductions and removal of bargaining rights that most other state employees had, while at the same time getting more inmates.

You may recall the graphic pictures of Lincoln Hills teacher Pandora Lobacz, who was beaten earlier this month and went public with her story on local TV.

But what also deserves attention beyond the violent incident is that Lobacz pointed not only to the inability to take certain measures against students, but also chronic understaffing over the last 6 years.
"If you don't hold somebody who is criminal minded accountable," she explained, "they will keep doing more and more until something major happens or again, my concern is that they're going to kill somebody there. And it might not be line staff. It might be another student because we can't protect them."

On top of that, she said the facility is severely understaffed and cannot retain employees for long, describing youth counselors in particular as being worked to death.

"Your front line staff that's supposed to be protecting the other students and protecting each other are working 70 to 80 hours of overtime every pay period and that's within two weeks," she said.

She blames that on Gov. Walker's Act 10 and Right to Work laws for taking power away from unions Lincoln Hills staff relied on. She added Walker's consolidation of all the state's youth prisons in 2011 happened before Lincoln Hills could hire enough workers for the amount of juveniles they would hold. She said they have never been able to have enough workers since.
Huh, you mean they're having trouble finding staff to come to an unincorporated town in northern Wisconsin, in a county whose population has declined nearly 3% since 2010, to work with juvenile criminals for less take-home pay and fewer job protections? Who woulda thunk that?

And to circle back to the NAACP's point from 2015, does it seem like a good idea to send a have population with a sizable minority and urban contingent to be taught by staff in a rural area of the state that is 97% white? Anyone who has dealt with young adults would know that the chances for stability and success go up if they are in a situation that is more familiar and comfortable to them. That's not taking anything away to the staff that I have little doubt is trying their best to help these young people, but the relocation of those kids and the unfamiliar environment they are being put in has been an extra unneeded barrier for that staff that likely made their job tougher.

But this would require a governor who actually cares about both the kids and state staff in these facilities, and Scott Walker clearly does not. After 6 1/2 years in office, Walker still has yet to visit Lincoln Hills or any of the understaffed state prisons to talk with staff and inmates about what things are really like. It's especially disgusting when you consider the myriad of photo ops this Gov has been glad to make to captive audiences to schools and campaign contributors businesses.

Make no mistake, this mess at Lincoln Hills is a direct results of actions (and a lack of actions) from the Dropout in Charge. From the decision to close the two facilities in SE Wisconsin and relocate those inmates in order to save money for tax cuts, from lowering the value of work at Lincoln and Copper Hills through Act 10 wage suppression, to refusing to act despite being told of bad conditions at Lincoln Hills 5 years ago, this is all on Scott Walker and the Wisconsin GOP for not stepping up and dealing honestly with the situation.

And you can bet these guys will do the bare minimum to help both staff and inmates as long as they are in charge. Any help or changes they make is to mitigate the political damage that may result from their incompetence, and/or shelter themselves from the inevitable lawsuits that will arise. These guys simply do not care about anyone outside of their little insider Club.

Monday, October 23, 2017

Right-wing Regents, Gov screwing over UW students + faculty. Will Bucky fight back?

It doesn’t sound like the rollout of UW System President Ray Cross’s plan to merge UW Colleges and Extension with 9 of the 4-year UW campuses is going over well. And faculty officials say a big reason why is that it continues a disturbing trend of UW workers not being given input on Administration-led changes at the UW.
The actions have further strained relationships with UW’s faculty and students, many of whom were already distrustful of System leaders after actions in recent years that weakened tenure protections and the role of those groups in campus governance.

According to Barmak Nassirian, director of federal relations and policy analysis with the American Association of State Colleges and Universities, and Noel Radomski, managing director at the Wisconsin Center for the Advancement of Postsecondary Education, the alignment between System leaders and conservative lawmakers could threaten the independence that distinguishes UW from other, more politicized state offices.

“There’s a pattern here of … ideologically driven decision-making,” Radomski said. “The culture has changed significantly — it’s gone 180 degrees. The independence that the UW System Board of Regents used to have, and the quasi-independence that the System administration used to have, is gone.”
Even Cross has admitted in public that his plans were developed through closed-door discussions among Regents and selected business leaders (which seems like a dodge around Open Meetings laws), but left UW faculty and students out in the cold.

This doesn’t seem to bother Cross much, but that act is what Nassirian says is a big reason behind the worries that faculty and staff have for the proposal UW reorganization. It also goes hand-in-hand with another recently mandated change from the non-academic Regents.
Nassirian said criticism of the merger proposal had more to do with the process by which it was created, rather than opposition to the idea itself.

The reaction from faculty and students was amplified, he said, because it came soon after another move to consolidate power under administrators — a new policy requiring that Regents hold five of the 10 seats on committees that search for UW chancellors. Faculty will have two seats while students and staff would each have one; the last would be filled by a community member or alumnus.
It’s very reminiscent of the Fox-con and WEDC’s “oversight”, isn’t it? Do you wonder why anyone with an IQ over 80 might be concerned that these UW changes aren’t being done for the best of reasons?

And it looks like the UW’s branches of the American Association of University Professors and AFT-Wisconsin have had enough with the regressive policies attacking UW faculty and staff in the Age of Fitzwalkerstan, and are asking the Board of Regents to re-dedicate themselves to including and respecting those who work there.
In 2011, Governor Walker proposed, and the legislature passed, Act 10, curtailing the system faculty’s rights to negotiate collectively. In 2015, the legislature severely weakened tenure, shared governance, and due process—and, by extension, academic freedom. The board launched its own salvo earlier this month, approving an anti-free-speech proposal allowing for the expulsion of students for “disrupting the free speech of others,” announcing a plan to merge the system’s two- and four-year institutions, and changing the procedures governing searches for chancellors and presidents—all without meaningful faculty input. Troublingly, the new search procedures put virtually the entire process of hiring new ‘campus CEOs’ in the hands of the very regents who seek to undermine the public obligation of the university, with limited roles for other campus constituencies. At the time of this writing, there is also a bill before the state legislature that would abolish a partnership that allowed university employees to work and train students at Planned Parenthood. (a bill that could get Madison's OB-GYN program decertified)

These actions constitute a brazen partisan assault on the Wisconsin Idea, the century-old notion that public higher education is a common good that exists for the benefit of the state’s people. They also exemplify a broader crisis in American public higher education, described in a recent AAUP investigative report as “occasioned by headstrong, thoughtless action by politically appointed regents who lack any respect for the faculties of the institutions over which they preside.” Nowhere in the country is this more evident than in Wisconsin.

We therefore call on the Wisconsin system board of regents to cease its attacks on the institutions it stewards; to recognize tenure, faculty governance, due process, and academic freedom as foundational to higher education; to support and encourage free speech for faculty and students; and to govern the system’s institutions for the common good of the people of Wisconsin.
As for how to solve this mess, Isthmus’s Alan Talaga noted that a lot of these concerns of top-down, pro-corporate decision-making and secrecy are a direct result of the appointment power of Governor Scott Walker. Governor Dropout has stacked the Board of Regents in his 6 years in office with people less interested in having the UW excel than they are in carrying out an anti-intellectual agenda promoted by ALEC, the Koch and Bradley Foundations, and other right-wing benefactors.
There are two reasons why the regents have become more aggressive in the last couple of years. The first is a nationwide war waged by conservatives on public universities. Even though the Republican Party controls the White House, both chambers of Congress and a majority of state legislatures, they need a boogeyman that proves that conservatives are the true repressed minority. Professors and undergraduates have become that boogeyman.

The second and far more important reason why the regents are pushing a hardline agenda is because the board is now almost exclusively made up of appointees of Gov. Scott Walker. Almost all regents serve seven-year terms. While Walker has been in office since 2011, the last few appointees of Jim Doyle finished their terms in 2016, leaving Tony Evers — superintendent of public instruction and Democratic gubernatorial candidate — as the lone voice of dissent on a board full of puppets.

Let me be clear: Scott Walker is the sole agent responsible for the attacks and erosion of the UW via his proxies on the board of regents. They will continue to carry out his agenda as long as he has the sole power to appoint new regents. They will continue to damage the legacy, reputation and work of campuses across the state.….

The only way to save the UW System as we know it is to defeat Scott Walker in 2018. A Democratic governor can start appointing new regents, cutting off the bleeding and slowly healing the board. They would make it harder for the conservative majority to pass these secretive policies under the radar. By 2022, Walker’s appointees would no longer make up a majority of the board.

This Isthmus graphic sums up the plan quite well.

Sadly, Talaga is correct. The lowlifes in today’s GOP will not invest in higher education and respect UW workers because they think they will get larger political rewards and donations for beating up on “elites”.

Madison’s Becky Blank and other UW chancellors need to recognize they cannot “play ball” with WisGOP legislators and think they will get payback in the form of more funding or fewer roadblocks in competing for 21st Century talent. In theory, it’s nice to wish for compromise and understanding among both sides, but that’s not going to happen in today’s ALEC-GOP and their war on intelligence and higher education. So the better strategy is for campus administration to publically go to war against these regressive scumbuckets, and get them removed ASAP.

The UW is not going to stay at an acceptable level of quality or service if the GOP stays in charge anyway, so Bucky and the rest of the System may as well fight, and at least have a chance at surviving.

2017 = Rising US deficits and dumping tax hikes onto middle class? Bad idea

It was buried among our whiner-in-Chief’s Twitter tantrums over the weekend, but Friday afternoon we found out about the final budget numbers from Uncle Sam for Federal Fiscal Year 2017.
The federal government finished fiscal 2017 with a budget deficit of $666 billion, an increase of $80 billion over the previous year. It was the biggest shortfall since 2013 and the sixth-highest on record.

The deficit equaled 3.5% of gross domestic product, up slightly from the prior year. Spending rose by 3% for the fiscal year, while receipts climbed by 1%. The government’s fiscal year runs from October through September.
And if you look at the official Treasury Statement, you’ll find that the biggest increase in those receipts came from “Employment and General Retirement”- in other words, Social Security and Medicare payroll taxes – up $49.6 billion from the year before (+4.67%). Interestingly, payments to Social Security and Medicare only went up by $32.4 billion last year (keep in mind when the GOPs try to cut Social Security and Medicare during “tax reform”- and they will try).

By comparison, other federal tax revenues were tepid at best, and corporate tax revenues actually went down.

Change in revenue, FFY 2017 vs FFY 2016
Individual Income Taxes +$40.0 billion (+2.65%)
Corporate Income Taxes -$2.5 billion (-0.84%)
Excise Taxes -$11.2 billion (-11.81%)
Estate/Gift Taxes +$1.4 billion (+6.62%)
Customs Duties $-0.3 billion (-0.75%)
Miscelleaneous/Other Ins./Retirement -$29.9 billion (-14.41%)
TOTAL NON-SS/MEDICARE TAX -$1.5 billion (-0.07%)

Also worth noting, while corporate income taxes went down, overall corporate profits were up 6.3% in Q2 2017 than they were in Q2 2016, and after-tax profits were up 7.8% in Q2 2017 vs a year prior (see Table 11 in this publication). So it’s not like there’s a high tax rate keeping profits from occurring, especially when you realize stock buybacks and dividends remain at or near record highs.

What’s also interesting to note is what has happened to the federal deficit in the 2 years since Republicans took over both the House and Senate after the 2014 elections, meaning that 2015-16 was the first budget passed with them running both houses. The deficit bottomed out at $438 billion in 2015 after 4 straight years of declines, and now has gone back up over $228 billion since then.

But despite the rise in the deficit and the decline in corporate tax collections, the Republicans in Congress and in the White House are still calling for regressive tax cuts that give away even more to the rich, which led to last week’s action where the Senate passed a budget resolution 51-49. Passing the resolution does little when it comes to actual law changes, but as CBS MarketWatch’s Robert Schroeder points out, it does make it easier for final legislation to get through.
The budget [resolution] is key since it allows Republicans to use what’s known as reconciliation, a procedure under which bills can pass the Senate with a simple majority. That’s critical since the GOP holds 52 seats in the Senate, and even a small number of defections dooms legislation. That’s what happened with the latest drive to repeal and replace Obamacare. On the budget bill, only Sen. Rand Paul of Kentucky voted “no.” In a tweet Friday morning, Trump predicted the Kentucky Republican would support tax cuts when a bill comes up for a vote.
Basically, changes to the budget would be “reconciled” in one bill. This was the same procedure that Republicans tried to use to repeal and/or deform Obamacare earlier this year, but failed when they couldn’t get 50 Senators to agree on a final bill.

In other words, the real work on GOP “tax reform” actually begins now. There’s not even a formal bill that has been introduced with the specific changes, just a 9-page framework document from last month that had few details in them. And of course, the details are the real problem here with the GOP bill.

Because the GOP tax framework gives so much away to the rich, there has to be some other kind of revenue to offset at least a portion of those tax cuts to keep the deficit from exploding. And that led to this report which came out over the weekend.
Proposals floating around Washington to cap the amount that Americans can contribute before taxes to 401(k) plans and individual retirement accounts are unsettling professionals in the retirement industry….

Lobbyists and others in the retirement and financial services industries who have spoken to congressional staff and committee members say lawmakers are looking at proposals that would allow 401(k) participants to contribute significantly less than what is currently allowed in a traditional tax-deferred 401(k). An often mentioned amount is $2,400 a year. It isn’t clear whether that would only apply to 401(k)s or IRAs or both.
So after decades of claiming 401-k’s were a great tax-sheltered investment and way to make up for disappearing pensions (a sketchy enough claim by itself), now GOPs are considering limiting how much people can write off to less than $100 every 2 weeks? That’s a sickening double-whammy, especially to workers who are trying to “catch up” on retirement savings, or with younger workers who are just starting to be able to invest that amount of money. Apparently even Donald Trump didn't think limiting 401(k) were a good plan, as the President* formally opposed that idea today.

But the other options to offset revenue aren’t that good, either. The largest common deduction that may go away under tax “reform” would be the deduction for state and local taxes (SALT). Not only would you be likely to pay more taxes if you are a typical middle-class or upper-middle class homeowner in an area that has property taxes, but the Center on Budget and Policy Priorities notes that it would likely lead to further budget cuts at the state and local levels.
Ending the SALT deduction would strain state budgets over time by making it harder for states and localities to raise the revenues needed to invest adequately in their communities.

The SALT deduction is effectively a form of revenue sharing between the federal government and state and local governments. To understand how it works, consider a taxpayer in the 28 percent federal income tax bracket. When a state raises $1 of additional revenue from this taxpayer, his overall taxes rise only by $0.72 because for that additional $1 in state tax payments, he or she can deduct 28 cents. Without that deduction, taxpayers would be less likely to support current state and local tax levels. As a result, states and localities would likely struggle even more than they do now to raise adequate revenue… (as we have already seen in Wisconsin)

This strain on state and local budgets from repealing the federal SALT deduction would likely result in cuts down the road to state and local services. These cuts could well include reductions in support for education — the single largest part of state budgets — as well as cuts to infrastructure spending and other investments that are key to the nation’s long-term economic prospects. Since states and localities provide over 90 percent of K-12 school funding, and pay 75 percent of the cost of maintaining and improving the nation’s non-defense public infrastructure assets, their capacity to make these investments is particularly important to the nation’s future economic strength. Further, many states already have cut funding for these crucial investments, making the prospect of additional cuts particularly disturbing. For example, the average state has cut funding for higher education per student by 16 percent over the last decade, after adjusting for inflation. And more than a quarter of the states have cut general support for K-12 education by 7 percent or more per student over the same period.[6] In addition, state and local government spending on physical infrastructure dropped from its high of 3 percent of the nation’s gross domestic product in the late 1960s to less than 2 percent in 2015.[7]
Of course, if you’re a Koch/Norquist-type wack job in DC Bubble World, you may like the idea of starving governments of revenue leading to breakdowns in services and sell-offs to corporations. But for the vast majority of us, I don’t think that’ll end up being a good trade.

The other shell game that this might encourage is that sales taxes and other fee-based revenues would be more likely to be raised at the state and local levels, since those aren’t written off today in most states (including Wisconsin), so there's no change in tax benefits by changing these levels even if SALT goes away. This would likely make the tax code even more regressive at the state level than it already is, which oligarchs may be cool with, but I bet you won’t be.

My thoughts at this point on “tax deform” is to remain vigilant, since there’s no bill to vote on at this time anyway. But realize that the last thing this top-heavy economy needs is another giveaway to the rich and corporate in a time when the deficit is rising along with inequality, which means that GOP support of this tax bill shows that they don’t really care about what happens to 99% of us. Which means you have to remove any Kochsucker candidate who supports shoveling even more money to their donors at our expense.