Pre-election spending increases don't make up for failure of Walker's austerity

The National Association of State Budget Officers (NASBO) released their annual State Expenditure Report last week. If you dig inside the numbers, you can see how Scott Walker’s attempt to use his 2015-17 budget as a prelude to a presidenctial so badly shortchanged the state, and how the lack of investment slammed job growth to a near-halt.

The NASBO report says that Wisconsin was only 1 of 8 states that spent less money in Fiscal Year 2016 than Fiscal Year 2015. Wisconsin wasn’t hit with the oil bust like many of these other states were, which means we fell into the other common category behind spending cuts in that year - bad leadership.

States with less spending in FY 2016
Alaska -25.3% (oil bust)
Ill. -16.3% (delayed payments due to bad leadership)
N. Dakota -5.9% (oil bust)
N.J -0.9% (Chris Christie credit downgrades)
Wis. -0.8% (bad leadership)
Mississippi -0.3% (it’s Mississippi)
Oregon -0.2% (“other state funds” had a one-year decline)
Louisiana (-0.1%, Bobby Jindal’s bad leadership AND oil bust)

It’s even worse when you focus in on the actual spending on K-12 education for 2015-16. Wisconsin was number 2 in the nation for cuts in spending and 1 of only 6 states to cut in this category.

States with less K-12 spending 2015-16
Cal. -3.3%
Wis. -2.7%
Okla. -2.6%
Kansas -2.3%
W. Va. -2.0%
Va. -0.8%
Alaska -0.5%

The California part is interesting, although I am not sure where that comes from. I do know this, when you’re cutting K-12 education more than Oklahoma, Kansas, and West Virginia, that is a BAD sign.

Also noteworthy is that Wisconsin didn’t come back with much more spending for Fiscal Year 2017, with only oil states, Colorado and West Virginia being lower on the list for the 2015-17 biennium. And no Midweste111rn state had a smaller increase in Wisconsin, including Illinois (which paid back some of their past-due bills in FY 2017)

Total spending change in FY 2017 vs FY 2015
Alaska -24.9%
N. Dakota -8.8%
Wyo. -1.5%
Col. -1.4%
W. Va. +0.4%
Wis. +2.0%
Conn. +2.1%
Ver. +2.3%

Any coincidence that Wisconsin’s job growth noticeably declined compared to the headier days of 2013-2015?



Even more remarkable is that most of Wisconsin’s spending increase in 2015-17 is concentrated in one area – Medicaid. NASBO says that of Wisconsin’s $909 million increase in total spending over those two years, $631 million of it was concentrated in Medicaid, which means spending for everything else in the state went up by less than 0.75% for those two years. That’s way below the rate of inflation for that time period, and it’s no coincidence that the state’s pothole problems and new wheel taxes and local sales taxes multiplied in those years.

Those spending reductions and the bad results that followed is what made the actions of the 2017-19 budget all the more notable. The Wisconsin Taxpayers Alliance noted this reversal of previous austerity policies by noting that the current budget increased General Fund spending by the largest amount since Scott Walker and the Wisconsin GOP came to power in 2011.

Planned spending in the recently enacted 2017-19 state budget departs from recent pat­terns in two important ways. First, general fund expenditures rise 8.8% over the two years, the largest biennial increase since 2009-11 (12.1%). Second, much of the increase is for school aid, which has grown less in recent years. K-12 aid will grow 8.3% over two years, the largest biennial jump since 2005-07 (9.0%)….

The state’s largest expenditure is for K-12 school aid, which grows significantly over the next two years. School aids are rising 3.4% ($187.4 million) this year and 4.7% ($264.3 million) in 2019 to $5.9 billion. School aids rose 5.6% and 3.9%, respectively, during the prior two biennia. Nearly all of the additional dollars are directed into a relatively new “per pupil” aid, rather than into the much larger equalization aid formula; this is a major shift in school funding.

Two other areas claim the bulk of remaining new spending. The budget uses income and sales taxes to reduce property taxes. It eliminates the state levy for forestry programs ($90 million annually) and the personal property tax on machinery, tools, and parts ($74 million); increases the school levy credit by $87 million per year, and raises the lottery credit by shifting $48 million of general fund taxes to pay lottery expenses.

But at the same time, some areas still were subjected to cutbacks in the latest budget, particularly when it came to state highway and high-cost bridge spending, which was cut by a total of $245 million for 2017-19. Yes, some of that was made up by increased local aids to streets (and you can argue that this is a better allocation of resources), but the needs on the state’s main highways will be worse in 2019, and require more costs, taxes and borrowing.

But again, those cutbacks in highway spending (done in a desperate attempt to stay on the good side of RW oligarchs by not raising taxes) make the Scott Walker/WisGOP Christmas Tree budget of 2017-19 all the more striking. It’s basically an admission the austerity gimmicks of that budget did not work either economically or politically.

So no Scotty, you don’t get to turn around and take credit for “extra investments” when your previously failed strategy set the state back. Instead, you must be held accountable for the screw-ups that you caused by deciding to value donors and right-wing oligarchs over the people of Wisconsin that PAY YOUR SALARY.