A Wisconsin-related Question for the Left: Where’s the Money?
Brian Beutler at TPM said Republican Wisconsin Gov. Scott Walker “ginned up” a “budget shortfall“. As if on cue, Jamelle Bouie at The American Prospect said Walker’s deficit reducing plan was “a ginned up crisis“. Political fiction writer Steven Benen (that’s what his posts are) says Walker is insincere. The Constitutionally confused Ezra Klein claims the “Badger State was actually in pretty good shape. It was supposed to end this budget cycle with about $120 million in the bank.“
All of these truth-challenged individuals are using two pieces of information. One is this report from Wisconsin’s Legislative Fiscal Bureau, the state’s equivalent of the CBO. The second is the notion from Klein, Benen, and Beutler that outgoing Democratic Gov. Jim Doyle left Walker a surplus that the new governor squandered. The truth, which these clowns could find but have ignored, presents a far different picture.
The document from the Wisconsin bureau had this to say last month:
More than half of the lower estimate ($117.2 million) is due to the impact of Special Session Senate Bill 2 (health savings accounts), Assembly Bill 3 (tax deductions/credits for relocated businesses), and Assembly Bill 7 (tax exclusion for new employees).
As explained by Klein:
The governor called a special session of the legislature and signed two business tax breaks and a conservative health-care policy experiment that lowers overall tax revenues (among other things). The new legislation was not offset, and it helped turn a surplus into a deficit
But even Klein was forced to change his mind in an update to that same post:
The $130 million deficit now projected for 2011 isn’t the fault of the tax breaks passed during Walker’s special session…
As a matter of fact, that deficit for 2011 came from a source not reported by anyone:
The Wisconsin Supreme Court ruled Tuesday that the state must repay a medical malpractice fund more than $200 million it took to balance the budget three years ago, potentially throwing the current budget into disarray…
The state budget is projected to finish the current fiscal year on June 30 with a balance of $45 million, not enough to absorb a $200 million hit.
Ding, ding, ding, ding, ding, ding!!! By the way, that $200 million movement occurred when Doyle was governor and Democrats ran both Houses of the Wisconsin legislature.
And speaking of Doyle and the Democrats, they were charged with closing a $6 billion gap in the 2009-2011 budget, which they did. Per the first piece from Beutler that I linked to:
In 2009, Wisconsin Dems did get just over a billion in help from the stimulus bill, but they made up the rest by giving state agencies less money than they asked for, and through furloughs and other real austerity measures.
It’s a nice story. It’s fiction, but a nice story.
Wisconsin did get Porkulus dollars and did give state agencies less money. But it wasn’t enough to close the gap. Not nearly enough. First, Doyle and the Democrats increased taxes in 2009:
Tax increases include: $310 million by raising the $1.77-per-pack cigarette tax to $2.52; $287 million by creating a new, 7.75% income tax bracket for the wealthiest taxpayers; $242 million by cutting in half the tax exemption for capital-gains investments; and $105 million with a 75-cent monthly fee on telephone lines that will start Sept. 1.
For the two-year period, that’s over $2 billion in taxes; more than $1.1 billion of those taxes hit the wealthy and investors. Now we know why Wisconsin voters threw out all those Democrats this past November. Do you see this anywhere by Beutler, Benen, Bouie, or Klein? No. Nothing. Their narrative is all that matters: Democrats good, Republicans bad.
Doyle also laid off 1000 workers and rolled back a 2% pay raise, which came to a savings of about $1.7 billion (ignore the math in the piece; it isn’t correct); those are the austerity measures Beutler mentioned. So how was the rest of the gap filled? Porkulus. But not the $1 billion mentioned by Beutler; it was more than $2 billion.
So Doyle filled in a $6 billion budget gap mostly with new taxes and Porkulus money. Now there’s no Porkulus money. Plus, they have to repay a medical malpractice fund. The increased revenues from the Democratic tax hikes haven’t materialized. Boom; we have the $3.6 billion deficit Walker has to cover. Since Doyle’s failed tax increases didn’t bring in the dough, then it has fallen to Walker to find the money elsewhere. And guess what? Walker has found the right place. And Walker can further improve Wisconsin’s money woes by declaring that the “protesters” engaging in their illegal strike have quit their jobs, thus saving taxpayer dollars on these salaries and by not having to pay out unemployment on these deadbeats.
The leftist windbags I linked keep asking conservatives, if tax reductions are supposed to increase revenues and create jobs, how come Wisconsin is broke? Allow me to answer their question with a question of my own: if Doyle’s tax rate increases were supposed to increase revenues, where’s the f—–g money?
Jerks, all of them.