Monday, November 30, 2015

GOP prison policies, vehicle impoundment bill intended to continue downward spiral

A timely and great analysis from the Wisconsin Budget Project on the continually increasing cost of imprisoning people in Wisconsin, and how it's taking away from other needs and priorities.

First of all, Tamarine Cornelius points out that Wisconsin spends more per capita than the national average, and over all of our neighbors.

The increased costs and rates of incarceration means that the newest state budget will spend more money on Corrections, while reducing funds from education.

So what are GOP state legislators doing in reflection of this increased spending on prisons and increased strain on budgets? Trying to increase the costs and barriers that result from such "tough on crime" policies against the poor, which increases the spiral eve\n more.
Rep. Joe Sanfelippo, of New Berlin, began circulating the bill for co-sponsors on Tuesday. He said in a memo to his fellow lawmakers that the bill would help stop drunken drivers who have lost their licenses from getting behind the wheel.

Currently, a judge can impound a car as part of the punishment for driving without a valid license if the driver owns the car. The length of the impoundment is up to the judge....

Under the bill, a police officer would be required to immediately impound the vehicles of those caught driving without a valid license. The officer would have to contact any rental or leasing agency registered as the car's owner, as well as any lienholders. Police wouldn't have to impound the vehicle if the driver's license expired in the six months before he or she was stopped and the driver hasn't been charged with operating without a license in the past.

If the vehicle isn't claimed within 30 days of the end of the impoundment period it could be sold.
San Felippo is trying to claim the bill is related to dealing with drunk drivers, but one look at who would be likely to be subjected to these impundments shows a very different reality. In fact, San Felippo's bill is a racist ploy that disproportionately hurts minorities in Milwaukee. Here is a 2005 study from UW-Milwaukee’s John Pawasarat which was done regarding a proposed voter ID law at the time, and it shows just how commonly minorities get their licenses revoked in and around the state’s largest city.
2. Minorities and poor populations are the most likely to have drivers license problems. Less than half (47 percent) of Milwaukee County African-American adults and 43 percent of Hispanic adults have a valid drivers license compared to 85 percent of white adults in the Balance of State (BOS, i.e., outside Milwaukee County). The situation for young adults ages 18-24 is even worse -- with only 26 percent of African Americans and 34 percent of Hispanics in Milwaukee County with a valid license compared to 71 percent of young white adults in the Balance of State.

3.A large number of licensed drivers have had their licenses suspended or revoked, many for failure to pay fines and forfeitures rather than traffic points violations. The drivers license file shows 39,685 individuals in Milwaukee County who have drivers licenses but also recent suspensions or revocations on their licenses. Another 49,804 Milwaukee County adults had a recent suspension/revocation but no license with the DOT. Only 65 percent of adults in Milwaukee County have a current and valid Wisconsin drivers license, compared to 83 percent of adults in the Balance of State.
In fact, Wisconsin Community Services and Wisconsin Legal Action have run a program for several years to help low-income Milwaukeeans get their driver’s licenses restored in order to improve their employability. But instead of encouraging measures like that, or in changing criminal laws that lead to licenses being taken away for violations that have nothing to do with driving, Rep. San Felippo thinks it’s a better idea to put up MORE barriers to that group of people. This will likely put those individuals under further hardship, making it more likely that hopelessness and/or criminality become part of those people’s lives.

Then again, why spend taxpayer dollars on something that might improve outcomes without the need for jail time when you can give those funds to the corrections system instead? Or take it to the next level, and give those correctional services off to a campaign contributor that may profit from it? Both Gov Walker and ALEC (who the majority of WisGOP legislators belong to and who is often responsible for many of these hateful, regressive bills) have longtime connections to the private prison industry, with Walker attempting to privatize the prisons nearly 20 years ago. In order for privatizing prisons to be seen as a viable option, what needs to happen is for the facilities to be overcrowded, with taxpayer-funded resources not being able to keep up to the needs. Regressive laws like San Felippo’s keep impoverished people in the corrections system, and decreases the chances for them to get out of it, so there’s the supply of prisoners needed for potential overcrowding.

Then combine it with the disgraceful understaffing and lack of pay for jobs that have become a huge burden onto the state’s prison system, with the latest change being the setup of a rotation system for the forced overtime at the prisons, which includes veteran guards and other higher-ups along with newcomers. This is done without input from the guards themselves in the Post-Act 10 world, and is being chosen instead of raising pay of correctional guards and attracting more talent. The new OT policy is likely to drive up costs further, while continuing to drive down morale, making the Prison System (and the state’s budget) even less sustainable, and making privatization more likely. Very sick, but that’s how these people roll.

And San Felippo’s vehicle impoundment law also fits another WisGOP goal. After all, it seems to be a requirement for elected officials in the party to go out of their way to punish poor people, and that’s doubly true if those poor people can be sterotyped as “minorities in Milwaukee.” Let’s face it, if the state invested in intensive programs to prevent poverty, and they worked to reduce crime and improve outcomes for the poor in the state’s largest cities, then it proves the whole WisGOP “blame the poor” mentality to be wrong, and that government works in solving these problems. And that isn’t an acceptable outcome to them.

In addition, having a permanent underclass of citizens allows for a group that working-class whites can resent and “kick down” at, allowing the GOP to stay in power, which continues the cycle of working-class whites seeing their wages stagnate and/or drop, while the oligarchs skim increasing profits off their hard work. Since the GOP runs all forms of state government in the state, and has numerous AM radio stations willing to hammer this propaganda, why shouldn’t they keep tapping that the well of working-class white resentment?

Put these details together, and it makes for an ugly picture of Wisconsin politics in GOP-land. While some might see the increased cost of Corrections in Wisconsin as having little to do with a seemingly innocuous bill by Joe San Felippo to impound the cars of those charged with illegal driving, I see political actions that have a clear connection to favor a certain outcome. In this case, the continuance of a two-tier Wisconsin society while encouraging those on the lower and middle parts of that second tier to scapegoat those below them, allowing the rich and politically connected to continue to steal from all of the rest of us.

Saturday, November 28, 2015

October jobs "boom" in Wisconsin not felt in many places

I've expressed skepticism regarding last week's report from the Wisconsin Department of Workforce Development of 16,100 total jobs and 15,100 jobs being added in Wisconsin for October. And we got a follow-up note on that report on Wednesday that also makes me cock an eyebrow, this time in the form of the local jobs and unemployment rate report.

This new DWD report showed the alleged jobs gains in the state were heavily concentrated in only a few areas of the state. Also worth noting is that (for some reason) they can't give specific seasonally-adjusted numbers for the growing Madison area, because Green County was added for that MSA in the last year.

Seasonally-adjusted change in jobs, Wisconsin Oct 2015
Milwaukee-WOW Counties +6,900
Non-Madison metro areas +200
Rest of state + Madison area +9,000

In fact, 5 of the state's 12 metro areas lost jobs in October, which wouldn't be something you'd expect if the state was really booming. And then I looked over at the non-seasonally adjusted numbers, which do include the Madison MSA, and the numbers get even odder.

Non-seasonally adjusted change in jobs, Wisconsin, Oct 2015
Milwaukee-WOW Counties +10,300
Madison metro area +5,200
Non-Madison, Milwaukee metros +6,100
Rest of state +5,200

So nearly 58% of the state's raw growth in jobs for October was in the two largest metropolitan areas (who account for around 43% of the state's total jobs). The high number of jobs in the non-metro "rest of the state" category is also intriguing, as many rural areas in Northern Wisconsin lose jobs this time of year as the weather cools and tourism season ends. This fact is underscored by the fact that 8 of the top 9 counties for (non-seasonally adjusted) unemployment in October were located north of Highway 29, and 6 of those 8 saw their unemployment rates go up last month while the state's non-seasonally adjusted unemployment rate went down.

So let's see how these figures shake out in the next couple of months, as the seasonal adjustments level out. The large amount of mass layoffs and lower-than-projected revenues seem to belie the numbers that indicate job growth boomed in Wisconsin for October, and I'm very interested in seeing what happens as a large amount of data comes in over the next few weeks to see which direction wins out.

Friday, November 27, 2015

GOPs stir up the hate, leading to sad, unsurprising consequences

This Charles P. Pierce article on how "America Sits on a Powder Keg" is more related to the resentment of minorities by the white working class (60 percent of whom believe white people are as discriminated against as minorities are) and how it is encouraged via racial dog-whistling and other baiting from the GOP. But it still seems appropriate to look at in light of today's shootout at a Planned Parenthood clinic in Colorado that has left at least 3 dead.
There is a wildness in our politics that goes back beyond this administration. But the election of [President Obama]—​and his stubborn insistence that he be allowed to act like a president—​has brought a focused volatility to that wildness that is unprecedented in the years since the turmoil of the 1960s. The lost illusions of American exceptionalism, and the loss of the dominant postwar American economy, make the results of that poll sadly unsurprising. But that basic disillusionment has been percolating around American politics for decades. There is something different about it now that is the result of years of exchanging history for desperate propaganda, a yearning for a past that never was, at least not for all Americans. In the 1960s, protests like those going on at various universities, and like the one that's ongoing in Minneapolis [against an officer that killed a black man], would have been completely unremarkable.

Now, though, thanks to 50 years of steady drum-beating about how it was in the 1960s in which the country began to slide into decline, and how it was in the 1960s that the power drained away from You in the direction of Them, a culture of victimization has arisen despite all the data proving that the victims in question have not been victimized at all, at least not in comparison to their fellow citizens, anyway. What has victimized them are economic and trade policies that have drained the country of decent paying jobs, the decline of organized labor, and a lot of sleight-of-hand political jibber-jabber that continues to this day. It's just easier to get people to blame each other. And that's what's coming to a head in the country now.

That poll is chilling in its detachment from actual empirical reality. The people polled in it are chilling in their certainty. That certainty makes them believe that the police are their Myrmidons holding back the power of their fellow citizens who happen to be black, and who wield so much power that any means of resisting that power is wholly justified. That certainty makes them believe that protesters on a campus in Missouri are some kind of threat against the dwindling promise of a real American middle class. That certainty makes them jump at shadows, predictably. That certainty eventually curdles into a rage that lashes out blindly at all the wrong targets. For too long, too many people have been willing to believe that which is not true. At some level, people rebel against the nonsense they've come to believe. They feel stupid. They feel like suckers. They look for easy targets. Rage is general, like Joyce's snow, all over this country. It is not a good time.
And even worse, the GOP and their propaganda network encourages that that rage and certainty against facts that Mr. Pierce mentions. It has to end, and the way it will end is for the Dems need to tie that race-baiting, Crusade-like religioisity, and "divide and conquer" governance around the necks of the Republicans, and not let up for the next 12 months, leading to a landslide Dem victory in 2016.

The dangerous rhetoric and degrading act won't end until the GOP pays a heavy electoral price for doing so. And I fear it'll get worse until it gets better, because the Republicans have little else to run on at this point.

Packers offer up an egg on Thanksgiving

It's tough enough to stay up after a certain time of night when you reach a certain age and stuff your face at Thanksgiving. But then I stayed up and watched THAT CRAP LAST NIGHT from the Packers. Seriously, you get an amazing scene that includes Starr and Favre meeting at the center of Lambeau Field at halftime as the whole country is watching on national TV, and how could the Packers possibly lose?

BUT THEY DID. Sure, the weather was God-awful, but there's no excuse for the team going and lays another egg at home against a lesser division rival. Beyond unacceptable and completely bewildering. This Packers team has gone completely downhill since it hit the bye week at 6-0, and even more amazing is that it's the team's passing game that is listless and seems to be completely lacking in chemistry and execution. Davante Adams is beyond brutal- he caught 2 balls on 11 targets and allowed himself to get beat on Rodgers' INT, a feat that is very hard to do. Randall Cobb can't stretch the field, no other WR can win at the line of scrimmage, and Aaron Rodgers is inaccurate and seems to be playing hurt (I could see an off-season surgery in his future).

When it comes to the Pack this morning, the clip that keeps playing in my head is this classic from Jim Mora.

Thursday, November 26, 2015

None dare call it Fascism- until now

I happened to come across this excellent sequence on Chris Hayes' show on MSNBC, which discussed the increasing connection people are drawing between Donald Trump's rhetoric and the mentality of Fascism. The best part is when former DNC Chair Howard Dean comes on around 6:20 and goes right for the jugular, calling out not only Trump, but the entire GOP as an "authoritarian party" which has dog-whistled these same statements for years.

This is exactly how the Dems need to talk to the American people. Hang the GOP's racism and anti-democratic leanings around their necks! And make the average person understand the real danger that exists behind this mentality. Many bystanders think that "Oh, they can't be that bad" and don't want to believe the ugliness that is inherent in today's GOP.

Some may say that Dean is blunt and abrasive, but he tends to be right. I remember back in the Summer of 2004 when Dean reacted to the Bush Administration raising the Terror Threat Status by saying "Well, I hope it's legitimate and not being done for politics and trying to scare people." Then fast-forward 5 years and look what we found out.
Former Homeland Security Secretary Tom Ridge claims in a new book that he was pressured by other members of President George W. Bush's Cabinet to raise the nation's terror alert level just before the 2004 presidential election.

Ridge says he objected to raising the security level despite the urgings of former Defense Secretary Donald H. Rumsfeld and then-Attorney General John Ashcroft, according to a publicity release from Ridge's publisher. He said the episode convinced him to follow through with his plans to leave the administration; he resigned on Nov. 30, 2004.
So yes, the Bushies were manipulating the terror threat and the American people, and Dean was right to say so.

It's well past time to have people like Dean put back in charge of the Democratic Party, and heading up tickets for office. The people are looking for RIGHT and HONEST, which helps explains the rise of Trump (the racist, blunt trash-talking is confused for honesty), because the people know most of our political candidates and media aren't speaking to the reality that most people are facing. They also want to see the lies called out, and the puppets exposed.

The 20th Century is over, and it's well past time for the Dems to act like it, and stop caring about a handful of soccer Moms and care more about the wider group of people who are angry and struggling every day.

Tuesday, November 24, 2015

Why are those working-class whites voting to screw themselves?

The New York Times’ Sunday Review ran this excellent article from ProPublica’s Alec MacGillis, which discussed why lower-income whites in many impoverished rural areas are increasingly voting Republican, At first glance, this trend doesn't seem to make sense given the anti-worker and pro-corporate policies of the GOP, but MacGillis (who wrote a definitive description of Scott Walker’s appeal among angry white Wisconsinites last year) notes that rural areas are trending Republican is because older and working class people are voting out of resentment of those deemed below them on the social scale. And then that is combined with poor people not getting to the voting booth to balance out those angry working-class votes, leading to a net win for the GOP.
There has been a particularly sharp drop in support for redistribution among older Americans, who perhaps see it as a threat to their own Social Security and Medicare. Meanwhile, researchers such as Kathryn Edin, of Johns Hopkins University, have pinpointed a tendency by Americans in the second lowest quintile of the income ladder — the working or lower-middle class — to dissociate themselves from those at the bottom, where many once resided. “There’s this virulent social distancing — suddenly, you’re a worker and anyone who is not a worker is a bad person,” said Edin. “They’re playing to the middle fifth and saying, ‘I’m not those people.’ “

Meanwhile, many people who in fact most use and need social benefits are simply not voting at all. Voter participation is low among the poorest Americans, and in many parts of the country that have moved red, the rates have fallen off the charts. West Virginia ranked 50th for turnout in 2012; also in the bottom 10 were other states that have shifted sharply red in recent years, including Kentucky, Arkansas and Tennessee.

In the spring of 2012, I visited a free weekend medical and dental clinic run by the organization Remote Area Medical in the foothills of southern Tennessee. I wanted to ask the hundreds of uninsured people flocking to the clinic what they thought of President Obama and the Affordable Care Act, whose fate was about to be decided by the Supreme Court. I was expecting a “What’s the Matter With Kansas” reaction — anger at the president who had signed the law geared to help them. Instead, I found sympathy for Obama. But had they voted for him? Of course not — almost no one I spoke with voted, in local, state or national elections. Not only that, but they had barely heard of the health care law.

This political disconnect among lower-income Americans has huge ramifications — polls find nonvoters are far more likely to favor spending on the poor and on government services than are voters, and the gap grows even larger among poor nonvoters. In the early 1990s, Senator Mitch McConnell of Kentucky freely cited the desirability of having a more select electorate when he opposed an effort to expand voter registration. And this fall, Scott Jennings, a longtime McConnell adviser, reportedly said low turnout by poor Kentuckians explained why the state’s Obamacare gains wouldn’t help Democrats. “I remember being in the room when Jennings was asked whether or not Republicans were afraid of the electoral consequences of displacing 400,000–500,000 people who have insurance,” State Auditor Adam Edelen, a Democrat who lost his re-election bid this year, told Joe Sonka, a Louisville journalist. “And he simply said, ‘People on Medicaid don’t vote.’
This cold-blooded calculation by arrogant corporatist politicians happens because they do not fear a popular uprising that will get them thrown out of office. It also illustrates the foolishness in Dem strategy to ignore the needs of this large group of people in order to appear “unoffensive” to try to appeal to dwindling numbers of “swing voters” like soccer moms and hot-shot entrepreneurs. GOPs are less likely to waste their time dealing with such mushy, financially-comfortable folks, and instead work on stirring up the masses below them.

Which is the other point of MacGillis’s article, noting that many lower-income but working individuals in these little towns are trending Republican because they have a personal experience with the people below them, but don’t see the corporations and oligarchs that are holding their wages down and are more likely to be the cause of the destitution that they witness.
The people in these communities who are voting Republican in larger proportions are those who are a notch or two up the economic ladder — the sheriff’s deputy, the teacher, the highway worker, the motel clerk, the gas station owner and the coal miner. And their growing allegiance to the Republicans is, in part, a reaction against what they perceive, among those below them on the economic ladder, as a growing dependency on the safety net, the most visible manifestation of downward mobility in their declining towns.
What Democrats have failed to do over the last 30 decades is to link the negative consequences that are hitting the poorest Americans with the equally negative consequences of corporatist policies that are hurting the lower-class workers above the poor. There is plenty of talk about what should be done for those who are out of work or too sick too sick to work, but not enough about those who still do have jobs, but are getting screwed over on wages and benefits because of pro-corporate policies that encourage outsourcing, discourage unionization, and lessen economic opportunity for the vast majority of us.

Democrats don’t make the argument forcefully enough that “The GOP is SCREWING YOU TOO,” and instead talk about the worst cases (which are most likely to need government assistance), if they talk about economic issues at all. The average low-wage earning white person that is already resentful at their stagnant/declining position in society tunes this message out, since it isn’t directly relevant to their lives. They also become more apt to vote GOP to get even with those “others” that either are getting welfare benefits which they don’t qualify for, or they resent those who benefitted from better education and/or unionization (options that may not have been available to them), and ended up with a better life than the mediocre existence that the working-class person has to deal with.

Combine that mentality with a desire to believe in “‘Murican Exceptionalism,” that our system is the one which works best, and that there is a chance to get ahead in this society. Let’s face it, who wants to admit that they have wasted much of their life in a losing game, and that it would take a radical change at a later point in life to become better off? It is much easier to blame others, and try to kick down at those who aren’t at your level, than it is to say “the whole game is rigged”, and demand fundamental change that takes a lot more work to pull off.

Which is perhaps the bigger point- while this country is undoubtably much better off economically than when Barack Obama took office in 2009, it hasn’t undergone the fundamental change and reordering of priorities that was necessary to wash away the disastrous stain of the Bush Administration before it. As a result, the standard of living for the average working person hasn’t improved enough (if at all) compared to a decade ago, and there is the looming reality of the next downturn making things worse. These uncertainties lead to fear, and fear leads to irrationality, and voting “against your own interests.” And because Democrats in the White House haven’t gone far enough to end the “Wall Street over Main Street” economy that has led to such rampant inequality and stagnation of wages for the lower half of American earners, more white people in the lower half of that spectrum are susceptible to voting for Republicans who appeal to their more base instincts of hate and resentment.

Which is why we must go further, and be more forceful in denouncing pro-corporate policies. This includes turning down the job-busting Trans-Pacific Partnership (TPP), and demanding higher wages not just for those making $7.25 an hour, but also for those stuck in a mediocre $12-an-hour job. It also should include stronger anti-trust legislation to preserve competition and discourage the mega-mergers that are resulting in increasing layoffs in the name of increased profit over increased pay (just ask the workers at the soon-to-be-closed Oscar Mayer plant how that merger is working out for them). And yes, this includes active support for UNIONS and other collective action, because that is likely the only way that rich, connected corporates will ever raise wages for the lower-level earner.

And it’s only through an unapologetically progressive ECONOMIC platform that there will be a larger voter turnout, and a change in voting habits that will enable this country to turn back the regressive actions that have happened since the disastrous 2010 election. That election not only flipped the House to the Republicans and rewarded the obstructionism of the GOP ion Obama's first two years, but it also resulted in the gerrymandering that led to Congresses and State Legislatures passing bills that are increasingly out of touch with the wants and needs of the larger society. This strong economic platform has to happen now and it needs to happen on a national scale, because we’ve seen what the failure to do so has resulted in for Wisconsin- regressive policies that benefit the rich and connected at the expense of almost everybody else, with previously pro-union areas in Northeast Wisconsin turning redder and redder, and allowing the downward spiral and increasing inequality to continue.

Wanna know why I feel the Bern? This reality is a big reason why, because he won’t play footsie with the oligarchs that have driven this country’s economy into the ditch, and will expose the working classes to the real people that are holding them back. And he is the Democratic candidate that is most likely to spark that large turnout and awakening to the white working classes that can give the Dems a chance at the big win in 2016 they need to have.

Monday, November 23, 2015

There goes that Walker talking point- property taxes going up

When Scott Walker signed the Wisconsin State Budget this July, he tried to use the document as a way to sell his record for his soon-to-start (and soon-to-fail) presidential campaign. And central to that campaign was this claim.
“With this budget, taxpayers come first,” said Governor Walker. “Property taxes will be cut for an unprecedented six years in a row, while additional money is invested in K-12 education and expanding educational choices for parents and their students.
Sure, the projected property tax cut was only going to total $3 in the next 2 years. "But hey," said the rubes, "it still beats taxes going up."

Sorry rubes, but you were snookered. Your dreams of lower property taxes for the next two years just went out the window, as the Legislative Fiscal Bureau came out last week, and said instead of a $1 decrease on the average property tax bill in Wisconsin, those bills will now go UP by an average of $16 when they get shipped out in coming weeks. Ruh roh.

So why did it happen? The LFB says it was because of a couple of items that had been lurking in the background in recent months.
Over half of the tax bill difference ($10) is attributable to equalized values. The increase in residential property value due to economic factors is used to calculate the year-to-year change in the median home value, and the difference between the growth rates for total value and the home value is an important element in determining tax bill changes. When the value of an existing property increases by a lower percentage than the percentage change in total value, the existing property will comprise a smaller share of total tax base, and the percentage of taxes apportioned to the existing property will decline. In the July 27th memorandum, total taxable value was estimated to increase at a rate that was 1.1% higher than the home value change, but the actual 2015 equalized values reflect a difference of only 0.8%. Compared to the earlier estimate, less of the 2015(16) tax levy will be shifted to other property and more of the tax levy will be borne by existing homes.

The rest of the tax bill difference ($7) is due to somewhat higher school and technical college district tax levy increases and slightly less lottery proceeds available, in comparison to the July 27 estimated amounts. Statewide levy increases of 2.1% for school districts and 2.4% for technical college districts compare to earlier estimated increases of 1.6% and 2.0%, respectively. In dollar terms, the reported increases exceed the earlier projections by $21.7 million for school districts and by $1.4 million for technical college districts. In October, the Joint Committee on Finance approved a Department of Administration estimate of lottery proceeds available for distribution as property tax credits in 2015-16. The action lowered the estimate of available funding by $1.4 million from $162.8 million under Act 55 to $161.4 million in October.
Hey, who could have predicted that? Oh wait, (points both thumbs) THIS GUY! Oh and that lottery credit is supposed to decline further next year. Double ruh roh.

The higher-than-expected increase in school levies are likely a big reason behind the absurd bill in the GOP Legislature that is intended to limit the ability of school districts to go to referendum to raise property taxes. Because one of the few tangible "positive" things the WisGOPs have been able to claim over this 5-year Reign of Error is "your taxes are lower!" Now that bullet is going away, and it's a direct result of GOP policies that cut funding for K-12 public schools, causing them to have to go to referendum just to leave the lights on and keep the buildings from falling down. And what's even worse than seeing property taxes go up is promising to the average low-info voter that they'd go down....and to have them find out otherwise. So to try to mitigate the damage from their own failed policies and a general backwards-ass mentality when it comes to taxes, many WisGOPs would rather blow up their earlier approval of "local control" and screw up public schools even further just to be able to have a campaign talking point. That's GOP "governance" for you.

What's even dumber about that referendum bill is that not only is it pissing a lot of people off as a usurping of local control, that bill won't matter for the 2016 elections anyway! Because higher property taxes will be on the bills that are coming out in a couple of weeks, and the next set of property tax bills won't come out until after those 2016 elections take place, with little chance of taxes being limited by the bill until the year after that. And the state budget is too busted for rising property taxes to be fixed in any useful fashion that doesn't involve major service cuts, or other taxes going up.

'Tis quite the quandry, is it not? But Scott Walker and WisGOP did it to themselves, and their gimmicks about lowering property taxes have now gone past merely being bad policy that leads to a low-wage, declining economy, the "lower taxes" claim isn't even true anymore. Go ahead and run on that, guys!

Sunday, November 22, 2015

Stone-cold theft in Madison- non-WEDC version

Yeah, this happened yesterday to my alma mater.

What a complete robbery. Yes, I understand that Bucky can't be turning the ball over 5 times and expect to win. BUT THEY STILL HAD IT TAKEN FROM THEM. To overturn a game-winning TD based on that video.... it sure makes you wonder if the video replay guy had Northwestern on the money line. There's no other explanation I can come up with, and the inevitable apology from the Big Ten offices will not help me feel better.

Being a liberal sports fan in this state has meant one kick to the groin after another for the last 12+ months. You get this close to a bigtime moment, and then it gets pulled away fro you (even the great UW hoops run to the title game ended up with that 2nd half jam job by the refs vs Duke). And yesterday just added to the list.

Saturday, November 21, 2015

WEDC literally out of control- handing out $ they don't have

Another day, and another revelation on how the Wisconsin Economic Development Corporation (WEDC) and the Walker Administration that created it refuse to follow rules or show any ethics other than paying back their buddies. This development is the result of a rare act of journalism in the Milwaukee Journal-Sentinel, courtesy of Jason Stein, and involves the state’s Legislative Fiscal Bureau sending a letter to WEDC saying that the agency is making promises that it literally can’t pay off.
The letter by fiscal bureau director Bob Lang was sent to then-WEDC chief executive officer Reed Hall on Aug. 19 and said WEDC had awarded $101.7 million in contracts, or $21.3 million more than its legal limit.

"Our office consulted with several legislative attorneys. They reviewed the relevant statutes and concluded that it appears likely that a court would (prohibit the awards)," Lang wrote….

The jobs tax credit was designed to provide incentives to companies that spent money to either hire workers or train them. The credit, which was limited to $10 million a year in total, could be paid out to a company over a period of 10 years.

That's where the dispute comes in, with WEDC and legislative attorneys disagreeing on whether WEDC could make awards in a given year that would be worth more than $10 million over the life of the awards without at least including a contract clause that allows the state to back out if future lawmakers don't set aside enough money for them.
A WEDC spokesman and the Wisconsin Department of Justice are claiming that the overselling of tax credits is just fine, because they say the limits are only based on when the tax credits are cashed in, but Lang’s concern is that being locked into contracts for years could tie the hands of future legislators and governors, without any budget including provisions for all those tax credits to be used.

There’s also the continual problem of WEDC being literally out of control, handing out tax credits on an excessive basis while seeming to ignore any rules or constraints laid out by legislators, and giving no real criteria for deciding who is worthy of those incentives (well, except for donation history to the Wisconsin GOP’s candidates- HAH!). At the same time, we have seen how these “job creator” tax credits have been gamed by companies such as Johnson Controls (who got tax breaks for adding jobs a couple of years ago, and now will outsource those same jobs in the coming months), and WEDC seems to have been asleep at the wheel while major employers such as Oscar Mayer and Tyson Chicken announced major layoffs and plant closings in the state.

Stein’s report and other WEDC-related failures of this week have led some state legislators to grow louder in their calls to end this slush fund. First among them was State Sen. Dave Hansen, who was saying this before Stein’s article came out.
Wisconsin workers should not have to pay to eliminate their own jobs nor should taxpayers be on the hook for commitments made by a rogue agency that continues to flout state law. It is way past time to admit that WEDC is a failure and shut it down.”

“There is no way to re-brand WEDC. It is a failed agency with a flawed structure that has done nothing but invite corruption and the waste of taxpayer dollars. Taxpayers and legislators from both parties should not settle for anything less than a complete tearing down of WEDC and a complete rebuild of our entire economic development program-including determining exactly what our state’s economic development mission should be.”
Also asking for the end of WEDC was Republican State Sen. Steven Nass, and while he’s often wrong about most everything else, nASS has constantly ripped WEDC’s performance and distortion of market outcomes, and refused to vote for Gov Walker’s latest CEO of WEDC. In a press release discussing the Tyson plant closing in Jefferson (which is in Nass’s district), he ended with this:
WEDC is seriously damaged and failing to effectively meet the public’s jobs in creating and saving jobs through it[s] programs to assist the private sector. We can’t waste any more time and resources in trying to save the Titanic from sinking.
Top Democrats in the Assembly are want WEDC to be blown up. The Number 2 Democrat in the Assembly, Rep. Katrina Shankland, who called WEDC “a personal piggy bank for Walker’s campaign contributors,” and said it was “beyond repair.” There also was a statement released by (future Governor) State Rep. Chris Taylor, who summed it up succinctly.
What else is it going to take for legislative Republicans to get serious about shutting WEDC down? We delivered a pink slip to Governor Walker when he was fired from the WEDC Board by the Legislature during the budget and now it’s time we deliver a pink slip to this failed job creation agency. From issuing millions in corporate welfare to individuals committing fraud to this latest development where $21 million in tax credits were illegally issued by the State – WEDC has been an embarrassment to our state for years.

The biggest Christmas present that Governor Walker and legislative Republicans could give the taxpayers this holiday season is toshut WEDC down. Our Governor couldn’t come close to meeting his 250,000 job creation campaign promise and now in 2015 Wisconsin has almost doubled the number of [mass] layoffs from 2014. This is an agency surrounded by fraud, waste and abuse and it’s time legislative Republicans admit they were wrong and agree to shut WEDC down.
The heat is definitely getting turned up on this issue, and no matter how much the Legislative GOP tries to distract with bathroom bills and legalizing corruption, WEDC’s failures keep creeping to the top. As I mentioned last week, there’s clearly concern from the GOPs that things are going to blow up even worse in the coming weeks, hence their leaders’ recent lip service of possibly doing some changes to WEDC. But I have severe doubts that most WisGOPs will have the guts to try to clean up the dirty, slushy mess that is WEDC- they gain too much from it.

Which is why you can bet the next 12 months will see more WEDC failures and corruption get exposed, and Wisconsin continue to lag economically and morally. It's a reality won’t change until the leaders are changed…..or they get perp walked.

Friday, November 20, 2015

October jobs look great- but probably aren't real

On the surface, these jobs numbers for October look outstanding.
Wisconsin added a statistically significant 15,100 private-sector jobs and 16,100 total non-farm jobs from September 2015 to October 2015 (seasonally adjusted). The addition of 15,100 private-sector jobs over the month is the largest one-month gain since April 1992, based on publicly available data. The month of October also saw significant job gains of 2,500 in manufacturing, 1,400 in financial activities, 5,000 in professional and business services, and 3,900 in education and health services. Wisconsin's significant year-over-year gains include the addition 50,800 total non-farm jobs and 43,600 private-sector jobs, which also include 14,100 additional jobs in education and health services, 4,700 jobs in financial activities, and 2,500 jobs in information.

•Place of residence data: A preliminary seasonally adjusted unemployment rate of 4.3 percent in October 2015, unchanged from September 2015.The 4.3 percent rate is below the national unemployment rate of 5.0 percent for the month and below the state's rate of 5.3 percent in October 2014. The state's October rate is still the lowest for the month since April 2001, when the rate was 4.3 percent. Additionally, the state's labor force participation rate of 67.6 percent in October continues to outpace the national rate of 62.4 percent.
And in a rarity, the labor force rose in October, and the "steadiness" of the unemployment rate actually masks a drop from 4.34% to 4.26%. So apparently our state was booming last month. Who knew?

The reason you or I may not have known happy days were here again is because those reported numbers should come with a huge amount of caution. The first of which includes the huge downward revisions from September’s numbers that are in the same jobs report that’s trumpeting the major increase in October.

Revisions from September 2015 Wisc. Jobs report
Private sector
Revision -5,700
Revised Sept. total -7,000

Total jobs
Revision -7,400
Revised Sept. total -6,000

So if you put the last two months together, the totals become +8,100 in the private sector and 10,100 overall. That’s still pretty good, but not really different what would be expected in two months that added (445,000 jobs) nationwide.

In addition, Wisconsin’s October jobs numbers have been subject to wide changes in each of the last two years. Take a look at what was originally reported by the DWD, and then compare it to what happened with benchmark revisions done early the following year, when jobs figures are compared to the Quarterly Census on Employment and Wages and then adjusted.

October jobs change, Wisconsin 2013 + 2014
October 2013
Reported +12,400 private, +11,900 total
Revised +600 private, -1,000 total

October 2014
Reported +4,000 private, +100 total
Revised +11,100 private, +11,300 total

So let's hold onto our hats on that preliminary figure of more than 16,000 jobs being added for October in the state. It seems like that number will be modified in a few months.

Another bit of data in that monthly report that undermines the alleged increase in October jobs is the inclusion of preliminary numbers from the next QCEW, which will be released nationwide next month. This goes over the June 2014-June 2015 time period in the more refined “gold standard” jobs report, and it shows that things weren’t exactly peachy a few months ago. Those numbers say that 30,735 private sector jobs were added, which is only 1.27% growth, the worst growth in a quarter for Wisconsin since the end of 2013. Total jobs also declined, to just under 29,000 total jobs and 1.03% growth.

This year-over-year QCEW figure is about 3,000 less than what was reported by the Wisconsin DWD this Summer, and as UW Professor Menzie Chinn notes, this has been a common trend over the last couple of years in Fitzwalkerstan, which likely means that the jobs numbers will be revised down when the next benchmarking happens in early 2016.

But hey, maybe the DWD is right, and maybe we did just match the private sector job growth for the first nine months of 2015 with what we added in October, despite the continual reports of mass layoffs being announced by Wisconsin businesses (Johnson Controls in Milwaukee and the Tyson Chicken plant in Jefferson are the latest to make those announcements with nearly 700 layoffs between them). However, I’ll maintain a healthy skepticism about the DWD’s theory that “Happy Days are Here Again,” especially given the data-hiding that this Administration has been recently doing, and I’d recommend that you do the same.

Thursday, November 19, 2015

Johnson Controls - the next nail into the WEDC coffin

It’s well past dispute that the Scott Walker-created Wisconsin Economic Development Corporation (WEDC) is little more than a taxpayer-backed slush fund for GOP corporate donors, but what's happened with Johnson Controls in the Milwaukee area has brought into focus all areas that WEDC has failed Wisconsinites in. This goes from the questionable handout of millions in tax breaks from WEDC for “job creation” followed by mass layoffs, to possible pay-to-play corruption, to disgusting displays of corporate greed.

Start with the job situation at JC, which has been the subject of a series of excellent reports by WKOW’s Greg Neumann in Madison (and Neumann has gone after WEDC with increasing diligence in the last year). Neumann noted that Johnson Controls is now outsourcing the jobs of many of the same employees that WEDC gave big money out to have JC hire a year ago.
On Friday, Johnson Controls, Inc. notified the Wisconsin Department of Workforce Development it will be permanently closing its Milwaukee Business Center in suburban Glendale and laying off all of its employees there beginning in January.

WEDC officials confirmed Tuesday the agency has awarded the company $2.46 million dollars in job creation tax credits since March 28, 2014 for two separate projects.

Johnson Controls received $1.46 million for the creation of 329 jobs at its corporate headquarters in Glendale. But the company also got another $1 million for the creation of 266 jobs at the Milwaukee Business Center (MBC), which is now shedding all of the 277 employees currently working there.
But that shouldn’t be a big deal, since Johnson Controls will have to pay back the money at the MBC right? Uhhh, not so much.
A contract agreement between the Wisconsin Economic Development Corporation (WEDC) and Johnson Controls may allow the company to close its Milwaukee Business Center (MBC) next June and still keep the majority of a $1 million tax credit award…

The contract obtained by 27 News shows that despite being signed on March 28, 2014, the effective date goes back to June 1, 2011.

WEDC Spokesperson Steven Michels indicated the deal was back dated because the old Department of Commerce made an initial award offer to Johnson Controls in 2011.

Due to the effective date, the company would be able to claim a $6,000 tax credit for any new job maintained into June 2016. That's because the contract only requires Johnson Controls to maintain the new jobs for 60 months past the effective date - a period that will end on May 31, 2016.
Oh, and lookie here, the last of the layoffs will occur in June 2016, meaning that JC could well get all of those tax credits without having to keep the jobs around. Cool deal, eh?

And in the repeat of a constant pattern we’ve seen since WEDC began, Johnson Controls employees have anted up to the campaigns of Gov Walker and other WisGOP. The Wisconsin Democracy Campaign noted these donations in a blog post they threw out yesterday.
Company employees contributed about $5,700 to Walker in 2014 when the tax credits were awarded and the governor was at the agency’s helm. Top Johnson Controls employee contributions to Walker in 2014 were $1,000 from Andrea Ferestad, of Mukwonago, senior program manager; $600 from Donald Pfeiffer, of New Berlin, an engineer; and $550 from Paul Thompto, of Brookfield, a control engineer.

Since Walker was first elected governor in 2010, through June 2015, Johnson Controls employees have contributed about $28,200 to the governor.
Granted, this figure is relatively small compared to the typical corporate business donations to Walker, and could just reflect the desires of some everyday Johnson Controls workers from the dead-red suburbs of Milwaukee. But Johnson Controls’ CEO Alex Molinaroli is a member of the Metropolitan Milwaukee Association of Commerce, a major pro-Walker organization that has given hundreds of thousands to help Scotty stay elected, including a $170,000 donation from MMAC’s PAC that Walker had to give back in 2012 after it was revealed that individual MMAC members gave in excess of state spending limits.

And even though Johnson Controls is outsourcing these 277 jobs to other JC “global business centers” in China, Mexico, and Slovakia, they apparently aren’t tapped out for cash, as this blurb from yesterday’s Milwaukee Business Journal shows.
Johnson Controls (NYSE: JCI) said its board has approved an 11.5 percent increase in its quarterly dividend. The first increased dividend of 29 cents per share will be paid Jan. 5 to shareholders of record Dec. 11. The automotive supplier and provider of facility management products and services has increased its dividend in 35 of the past 37 years.
Hmmm, so Johnson Control employees will gladly use money left over from their salaries to shell out funds to donate to GOP candidates, take taxpayer dollars from those GOP candidates via WEDC, and give out 11.5% more money to their stockholders. But when it comes to actually keeping people employed in Wisconsin, sorry! I guess the money just isn’t there! I find those priorities interesting….and vomit-inducing.

Ready to set up those guillotines yet? And on a related note, can we get the Obama Administration’s Department of Justice to put down the donut and start some perp walks on those who have helped facilitate the criminal enterprise known as the WEDC slush fund? 4 years of rampant pay-to-play corruption and fraud involving taxpayer dollars should be more than enough, shouldn’t it?

Wednesday, November 18, 2015

Wisconsin set to drop further in tax ratings. That's a sign of failure.

Found this little interesting tidbit from Jason Stein in the Journal-Sentinel today. Looks like Wisconsin will be moving up (or down, as it were) in national rankings due to some geeky budget research by a state organization.
For six years and possibly longer, the federal agency has been incorrectly double-counting some Wisconsin taxes to the tune of $215 per person in the state, artificially inflating where the state fell compared with its peers in 50 state rankings, a report by the Wisconsin Taxpayer Alliance has revealed. The group and state officials recently discovered the error independently and say it accentuates the state's steady improvement from a top three tax state two decades ago to somewhat more than average today.

In 2013, the most recent year available, Wisconsin taxes should rank 15th in the nation as a share of citizens' income, compared with the rank of 11th under incorrect data recently released by the U.S. Census Bureau, said Dale Knapp, research director for the Taxpayers Alliance.
Everything is published and posted across the states, so how did these figures get messed up? It goes back to a line item that you’ll likely see on your property tax bills next month.
The Census Bureau errors came to light when the agency reported that Wisconsin's net property taxes had risen by 5% in 2013 despite tight caps placed on those levies by Walker and GOP legislators.

"Right away, I'm like, 'OK that's not right,'" Knapp said.

State tax and budget officials had come to a similar conclusion and had discovered that the Census Bureau hadn't subtracted the tax credit money paid by the state government to local governments in Wisconsin to lower their net property tax levies for home and business owners from the gross amounts set by local officials.
And those types of credits have been rising in recent years, including an unfunded $406 million tax break to Tech Colleges in 2014, and an increase in the school levy credit that is part of this year’s state budget.

What doesn’t change with this new discovery is the state’s ranking in spending, which was pegged at 24th in the nation last month. It also reiterates Wisconsin’s relatively middle-of-the-road standing when it comes to total payments of taxes and fees, as we were rated at 21st per capita before this double-counting was found, and will likely decline further in those rankings after these figures are recalculated.

But what’s bizarre to me in this story is how the GOP types in the story are celebrating this like it’s a big deal and a sign of something to come. It’s not like the actual taxes being paid changed for anyone, and policies weren’t changed, it’s just a change in a ranking that won’t affect future economic results at all.

In fact, this revelation may make the WisGOPs look even worse, because it proves yet again that lowering taxes and lowering wages and other “pro-business” moves do not lead to stronger economic growth. As Wisconsin has fallen in the rankings for highest-taxed states, it has also fallen behind the country when it comes to job growth, as shown by the year-end rankings from the Quarterly Census on Wages and Employment for the 4 full years of Scott Walker's tenure in office.

1-year private sector job growth, QCEW, Wisconsin
2011 1.31% (37th)
2012 1.47% (36th)
2013 1.27% (38th)
2014 1.55% (35th)

So what Stein’s story really does it reiterate the failure of trickle-down policies to generate job growth in Wisconsin, and in fact, it shows an inverse correlation- where lower tax rates may be encouraging the hoarding of profits and refusal to hire and adequately pay labor. In addition, those lower tax revenues have led to a decline in the quality of services and the quality of life, which makes it harder to attract talent and lead to true, sustainable economic growth.

In other words, if I was a Republican, I wouldn’t talk too much about Wisconsin "improving" in the rankings when it comes to the taxes its citizens pay, because it proves just how wrong the GOP have been in their predictions that tax cuts would lead to prosperity.

Dear Dems- stop "doing the right thing!"

Earlier this month, I criticized the Democrats on the Legislature’s Joint Finance Committee for voting to approve Gov Walker’s request for $350 million in extra borrowing to avoid delays for various highway projects and maintenance. At that JFC meeting, the Dems lambasted the irresponsibility of Gov Walker and the GOP for allowing roads to deteriorate, adding the borrowing, and refusing to tax for the needed projects, but ultimately voted to allow it because they felt the needs of the state’s citizens should go beyond politics.

A couple of weeks later, this thinking seems more wrong than ever, and I’m far from the only one thinking so. Here’s former Madison Mayor Dave Cieslewicz ripping the Dems in the Legislature for their lack of strategic thinking when Republicans needed their votes on transportation funding and the new Bucks arena to get those initiatives passed, despite being in control of both houses of the Legislature.
And if the Democrats felt some need to come to the Republicans’ rescue on these issues, why didn’t they at least demand a high price for their votes? For example, on the Bucks deal they could have demanded that the money stay in the state budget where it belonged and garner their votes only if $250 million — about the same amount as what the Bucks got — was restored to the university system. (actually Dave, it’s only $4 million a year from the state vs the $250 million that was taken from the UW over the next 2 years, but I see your overall point)

On the road borrowing vote, they could have demanded that the vote be rolled into a bigger bill providing more money for buses and other forms of alternative transportation.

But none of that happened. After getting the bejesus kicked out of them by the majority party on issue after issue, the Democrats still found it in their hearts to give the GOP the votes they needed so that Republicans who didn’t want to take a hard vote didn’t have to.

The Democratic Party is just lost. It has no ideas, no leadership and no energy. It doesn’t just find itself in the minority. It has earned minority status.
I’m not as despairing as former Mayor Dave about the Dems current situation, but I do agree that they don't seem to understand the game being played. Along those same lines, here’s Lou Kaye with an excellent column at Rock Netroots explaining how Wisconsin Dems let themselves get suckered by the cynical GOP.
Believe it or not, minority democrats have already taken the bait and swallowed it whole as they are vowing ...vowing to introduce legislation to raise the gas tax and/or registration fees AHEAD of republicans ...while the same republicans are messaging bi-partisanship, "pledging to work" with them, but are saying policy-wise that spending, spending, spending is the problem. See what I mean?

You know, I can't get over some of the rhetoric used by Democrats to explain their votes on borrowing for transportation. Seriously, why are democrats complaining about republicans "not doing the right thing" on transportation when republicans can rely on democrats, as sure as the Sun rises every morning, to do the wrong thing? Dems said 71 percent of Wisconsin roads are in poor or mediocre condition, making us one of the three worst states for road conditions in America, so they had to approve the borrowing. Never mind that the borrowing restores the timetables for the road builders expansions and not crater maintenance.

But hey, we're a red state now - our roads are supposed to be crumbling, our schools are supposed to be in shambles, our workers are supposed to be skill gapped, our jobs are supposed to be leaving, our government is supposed to be corrupt and our trains are supposed to derail. Yet, it's the democrats (and locals) at every turn working to prevent those policies from going full metal jacket as intended. Don't democrats get it that Wisconsin business chambers endorsed and voted for a single party ruled republican majority to carry out those policies and a GOP executive to sign them into law?

If everything goes by the hands of their own making, and it is their own making, state Democrats, even under full red state majority legislative rule, will not be viewed as saviors. Instead, they will be the party identified with corporate welfare, debt and now higher taxes. Whoopeee! Voters will certainly gravitate to that. LOL.
I’d argue that the problem is less that the Dems have no ideas (they’ve introduced plenty of things that would clean up the cesspool of Wisconsin government and fund the services we need), but they don’t seem willing to hammer on those themes and spend time and effort differentiating themselves from the destructive policies of the GOP. Because the differences are mushed up, enough casual voters shrug their shoulders and stick with “the devil (in power) that they know”, or vote for some “gut” reason like guns and religion. Both reasons favor the GOP at this point.

It’s disturbing that the Dems don’t seem to have the guts to play the hardball politics that must be played against the GOP Wrecking Crew. If that results in short-term hardships for Wisconsinites, so be it, because keeping the GOP in power will only lead to even worse outcomes. And going along with the bad guys to keep things operating makes it very likely that the bad guys will stay in control.

Because whether the folks at the DPW want to believe it or not, the average voter won’t reward you for “doing the right thing” in the 2010s, and this is especially true when you’re in the minority. Ask yourself what was gained politically by allowing that extra road borrowing to go through? The GOP was allowed to kick the can further down the road (accidental pun) and make the argument on DOT funding a theoretical one for the 2016 elections, instead of having a failure that was right in front of the voters’ faces. Even worse, it gives the false impression to the average dope that the GOP actually cares about finding a viable solution to this problem, instead of making them literally put the money where their mouth was, and putting them on the spot as to just what they would do (or more likely not do, leading to more deterioration of our "48th in the nation" status for roads).

So instead of forcing a crisis and action at a time when the worst might be able to pre-empted, the Dems’ acquiescence to being a party to the GOP’s messed-up policies allows the GOP to say “w-well, well, the Dems went along with it too!” when they face unsatisfied voters next year. This type of overcalculated, 20th Century mentality of Dems wanting to be "bipartisan" is a suckers game when you’re playing against today’s GOP, and further review shows what a tactical blunder it was to allow that $350 million in borrowing to go through in the Joint Finance Committee earlier this month.

The Dems should have demanded that Gov Walker’s request for more borrowing be ripped up, and used it as an opportunity for a larger debate and more definitive action on the state’s transportation funding….or use it as a reason to blame it on the GOPs when they didn't have the guts to take any such action. Instead, they took the middle road, and may have gotten themselves run over.

Monday, November 16, 2015

Where's the data in this state?

I've hinted at this previously, but there has been a suspicious blackout of certain economic information in recent weeks here in Fitzwalkerstan. The information on Quarter revenues for Fiscal Year 2016 was slipped out at the same time that the State Legislature was voting to legalize corruption and money-laundering earlier this month- 3 weeks behind previous years. Those subpar numbers have pretty much taken away any fiscal cushion that might have existed at the start of this two-year budget, although obviously there is plenty of time left for that trajectory to change (for good or for bad).

But the bigger issue is the secrecy, and selectivity in releasing the information. The same has occurred with the state's monthly report of Receipts and Disbursments, which you can find on this page. Usually this report is out on the first week of a given month, but the Waker DOA haven't released either the September or October report as of today. Is it because there are some bad hints that this report might give, and throw the spotlight even stronger onto the economic failures of the WisGOPs over the last few years? That's what the blink test tells me.

We are promised to get more state data later this week when the monthly jobs report for October comes out this Thursday. But even then, the Walker folks will change what time of day that information hits, depending on whether it is good (usually earlier in the day) or bad (later in the afternoon). It's kind of an odd and fun little game to play, if you're a silly geek like me, to figure out the angle before the numbers are released.

Of course, if this group doesn't want to release data to the public, then I'll just have to make up the assumptions myself, and I'd encourage others to do so as well. Because I'd say "no news is bad news" when it comes to economic reports in the Age of Fitzwalkerstan.

Sunday, November 15, 2015

Why Dems must go big- the disaster in the states

Been down seeing family in Memphis this weekend, so not much time to talk here. But I want to forward a good column in Daily Kos talking about the GOP takeover in the states.

It also shows that the GOP's state version of the RNC has spent more than twice the money that the Dems' state appartus has in the 2010s. It is a damming indictment of the failure of Debbie Wasserman-Schultz and the DC Dems to care about the party outside of the I-95 corridor.Look no further than the wreck in Wisconsin to see how this neglect of the state's has hurt the party's ability to get power (via gerrymandering), and in turning the state into an undererforming cesspool of corruption.

And that's why going small and cautious will not cut it anymore for the Dems. The vandals in the GOP have wrecked things far too much, and being kind and incremental does not work in the land west of I-95 and east of the Rockies.

Friday, November 13, 2015

Is WEDC scam starting to come to a head?

Looks like the Wisconsin GOP is starting to feel the heat from the continual failures and corruption that plague the Wisconsin Economic Development Corporation (WEDC), especially in light of the revealatons that the organization was caught napping while Kraft-Heinz announced plans to close the Oscar Mayer plant in Madison. You can tell that there is concern in WisGOP land, because the Assembly Speaker is backing off his usual whine of “how dare others bring this up!”, and admitting that it may be time to look into some changes at WEDC.
Assembly Speaker Robin Vos, R-Rochester, said Tuesday he plans to discuss with Democrats their concerns about the Wisconsin Economic Development Corp. and is interested in addressing “sincere, legitimate problems,” but he isn’t proposing his own plan yet.

He said WEDC not proactively contacting Kraft Heinz as other states did in the months after a merger was first reported could be one of the issues discussed with Democrats. It’s unlikely such contact could have saved Oscar Mayer, but similar situations could arise in the future.

“Legitimate issues have been brought up,” Vos said in an interview. “We have taken steps to fix many of those, but I’m not saying it’s perfect and I’m not saying that there are not things that we could additionally do.”
Ok, that last statement is total gibberish, but the fact that Robbin’ Vos would even admit that “legitimate issues have been brought up” shows that WEDC is being exposed to the masses as a no-job-creating slush fund that we all knew it to be.

Vos’s comments come on the heels of U.S. Sen. Tammy Baldwin joining the long list of Wisconsinites asking for a federal investigation of WEDC. Baldwin’s request comes after months of inaction from Wisconsin Attorney General Brad Schimel (likely related to the fact that it would involve investigating people and organizations that helped get Schimel elected a year ago), and is based on WEDC’s irresponsible use of federal grant money, along with other sketchy lending decisions.
In a Nov. 6 letter to U.S. Attorney General Loretta Lynch, Baldwin asked the U.S. Department of Justice to review a $500,000 WEDC loan to a struggling Milwaukee company, Building Committee Inc., owned by a top donor to Gov. Scott Walker.

The State Journal reported in May that Walker’s top Cabinet secretary pushed WEDC officials to provide the company more than $4 million. But it didn’t get more than the original half-million dollar loan after the agency learned owner William Minahan had promised a luxury car creditor he would repay debt with state funds.

Baldwin referenced a letter Wisconsin Democratic lawmakers sent to Lynch after the State Journal investigation.

The Madison Democrat also cited a Sept. 21 letter from members of the Oneida Tribe of Indians of Wisconsin calling for an investigation into more than $1.1 million WEDC loaned to Green Box NA Green Bay and $2 million the agency loaned to Oneida Seven Generations Corp. Both loans are in default, and in the case of the Oneida Seven Generations Corp. the state used federal stimulus money, which Baldwin highlighted.
Let’s not also forget that WEDC got clipped early on in its existence for trying to use federal dollars from the U.S. Department of Housing and Urban Development, as Scott Wittkopf at Badger Democracy revealed over 3 years ago. The Walker Administration tried to have WEDC be the agency to handle millions of HUD dollars, only to be slapped down by HUD because WEDC did not have the authority to handle this money, because it’s privatized nature meant that the state wasn’t responsible for it. As a result, the Walker Department of Administration had to take over the funding and administration for the grant funds.

Wittkopf asked questions in that article which still linger today.
Are we witnessing the unraveling of a “shell game” to operate WEDC as a quasi-governmental agency with no oversight or accountability; investing state funds and resources for private profit at public expense?

Has DOA bypassed the HUD concerns and oversight of WEDC by acting as the “state authority” and virtual rubber stamp for any program administered by WEDC through DOA?...

It is apparent that WEDC is a hastily contrived, singular vision agency put together with no consideration for statewide public impact. While it may serve the corporate development elite in the state, it is keeping the general public (which fund its existence) in the dark as to its activities and investments.
3 years and numerous audits later, we still are in the dark over the decision-making process at WEDC (well, except for the obvious connections between GOP donors and taxpayer-funded awards), and in regards to just where all the money is and what it is going for.

Then add in that the State Assembly is poised to pass a campaign finance bill on Monday that would hide who donors work for, and make it more difficult to “follow the money” when it comes to taxpayer-funded handouts from organizations like WEDC. See, in WisGOP World, the problem with such a setup isn’t the lack of transparency or the possibility of corruption from having so little oversight. Instead, it’s because with campaign finance information revealing the workplaces of donors, it’s too easy for journalists and citizens to connect the dots and see what a taxpayer-backed slush fund WEDC really is.

And since Schimel or any other Republican won’t dare try to kill this golden goose of boodle, the Feds must step in, and conduct a full and open investigation of WEDC, and sooner than later. Even if Robbin’ Vos tries to “rebrand” WEDC or modify in some form to keep the heat from getting too close to him and his bosses, that doesn’t mean all of this sketchiness should be thrown down the memory hole. In fact, the flop sweat coming from WisGOP leadership in light of Dem demands for action is all the more reason to think there is a serious pay-for-play scandal brewing, and that it may connect a lot of the earlier corruption and John Doe-related money-laundering that has already come to light.

Wednesday, November 11, 2015

Gales of November be blowin'

Yesterday was the 40th anniversary of the infamous sinking of the Edmund Fitzgerald in Lake Superior, and our weather in these parts seems to be remembering that time over the next couple of days. Looks like the gales of November are coming, with gusts up over 50 mph in many parts of the state, sizable downpours, and even a few inches of snow in the Northwoods.

Both of these coverging events makes for a nice excuse to play this. Here, enjoy the next 6 1/2 minutes, and learn some Wisconsin-related history (granted, Mr. Lightfoot takes a bit of artistic license, but not that much).

I can definitely hear the rumbles outside right now, hear the rain pelting my house, and see the severe storm warnings just to the west of Madison. Doesn't seem like the typical November night, so you better batten down the hatches and grab your nearest Thunder Buddy (language NSFW)

Tuesday, November 10, 2015

GOP presidential candidates still cling to failed voodoo

Not that I'm watching the GOP Debate (I'm watching the Mike Tyson vs. Evander Holyfield "30 for 30", which is much more interesting), but I want to direct you to an excellent article from's Jordan Weissman discussing the real cost of the tax cuts proposed by GOP candidates. And not surprisingly, these tax cuts would hurt a lot of people if these GOP candidates also chose to balance the budget by cutting spending in other areas.
Take the proposals put forth by the two mainstream Republican favorites, Marco Rubio and Jeb Bush. So far, two notable think tanks, the left-leaning Citizens for Tax Justice and the conservatively inclined Tax Foundation, have scored their plans. They each arrive at vastly different cost estimates of the proposals, in part, from what I've been told, based on the different ways they handle changes to the corporate tax code and whether you factor in the pro-growth effect of lowering rates. But I'm not going to get into which group is more on target here, because they essentially point to the same conclusion: No matter how you run the math, these cuts are gargantuan. And the best way to see that is by comparing them to what the federal government currently spends on its major programs.

Let's start with Rubio. Citizens for Tax Justice believes that his plan will ultimately cost the government $11.8 trillion over 10 years. That's just slightly less than the roughly $12 trillion the entire Social Security program is expected to cost from 2016 through 2025, according to the Congressional Budget Office. It's also more than the $9.1 trillion.

The Tax Foundation is slightly more optimistic. Based on its static scoring approach, which doesn't take into account the feedback effects of economic growth, it thinks Rubio's plan will cost about $6.1 trillion, which is a shade less than what the government expects to spend on defense from 2016 through 2025. Yes, that's all defense. (Also worth noting: The group scored Rubio's plan before he added one additional tax bracket for upper-middle-classers, which should add to its expense.)

Weismman also looks at Jeb Bush's proposed tax cut, and while it's not an absurdly huge as Rubio's, but it still would be between $1.6 and $7.1 trillion (likely closer to $7.1, given that the $1.6 trillion figure uses "dynamic scoring", which falsely assumes there is some magic multiplier of growth that offsets the tax cuts). And Weissman mentions that no matter how you slice it, these GOP tax-cutting plans are insane, and again proves that "compassionate fiscal conservatives" are nothing of the sort.
Again, these are the tax plans on offer from the two leading mainstream GOP candidates for president. To make them work while eventually balancing the budget (as these men supposedly want to) would require excising massive chunks of the federal government in a manner that would undoubtedly fall hardest on the poor. Which is to say, a mainstream Republican in no way shape or form means a reasonable Republican.
Of course, maybe putting in reckless tax cuts are part of the plan, so the cuts on the poor and the aged can be excused away in the need to close the inevitable deficit, and privatization will have to be expanded. We know how that works right here in Wisconsin.

We can't even encourage more beermakers in Fitzwalkerstan!

This story from Mike Ivey in the Isthmus grabbed my eye, because it involved two of my favorite hobbies - beer and Wisconsin economic policies. The article centers on the One Barrel Brewery on Atwood Avenue in Madison (a place I have dropped in on a few times in my life), and describes how brewery owner Peter Gentry’s business has done so well that he couldn’t brew enough beer to meet demand at his building on Atwood, so he wanted to contract brew more One Barrel product at other sites.

However, this ran afoul of a provision that was put into Scott Walker's and WisGOP’s first budget in 2011 which changed state law regarding the number of on-site brewing locations and brewpubs could be operated by one business, which had the effect of favoring large brewers at the expense of smaller ones. As a result, Gentry was forced to make a difficult decision when he wanted to brew more beer off-site.
But in order to legally contract brew under the new state rules, Gentry had to switch the official classification of his business from “brewpub” to “brewery” — a move that also forced One Barrel to give up its license to sell wine and liquor, although it can still offer beer. That change alone, Gentry estimates, will cost $15,000 in lost sales. Meanwhile, other breweries operating prior to 2011 are still permitted to hold the Class B licenses that allow retail liquor or wine sales on premise.
Ivey's article says that this 2011 law is also causing snags for other Madison-area breweries, as the Wisconsin Brewery in Verona has a harder time hosting weddings and other occasions because it can’t serve champagne or wine along with its beer, and that Mob Craft brewery is having difficulty in joining up with Roman Candle pizzeria for a Milwaukee site, because it would expand on the number of places Roman Candle has a liquor license for (also a provision in the law).

Ivey notes that the law change (supported by the Tavern League of Wisconsin, who apparently fears the loss of business by brewpubs who also serve booze) expanded on old “tied house” laws that were intended to allow more competition at bars between various beer makers, back when “Schlitz Taverns” and “Pabst bars” were the general rule. By contrast, Ivey says that these new provisions are having the effect of holding back new brewers from getting into Wisconsin’s the industry, while other nearby states are adding brewers by leaps and bounds.
The three-tier system was adopted across the nation following the lifting of Prohibition in 1933 and was intended to prevent a return to the old “tied house” scenario where brewers could squeeze out the competition by forcing taverns to only serve their products. Each state enacted its own set of laws and a system to collect liquor taxes.

But rather than preventing large breweries from dominating local markets, the tied house laws today are obstacles to newer players looking to get started, says Bart Watson, an economist with the Brewers Association, which represents the nation’s 3,400 craft brewers. The trade group broadly defines “craft brewers” as small, independently owned operations producing less than 6 million barrels annually.

Wisconsin did see the number of craft brewers increase from 73 to 97 from 2011 to 2014, a jump of 32%. But other states like Minnesota, Illinois and Colorado have enjoyed three times that growth rate over the same period.
The article also quotes a Breweries Association statistic that ranks Wisconsin 45th in the nation in the growth of craft breweries in that time period, a pathetic performance for a state that has been tied to beer-making (and consumption) for so long. But this type of pattern of blocking independent start-ups from arriving on the scene has been par for the course in a 2010s Wisconsin whose economic policies are being determined by the old-money, anti-innovation oligarchs at Wisconsin Manfacturers and Commerce and the Bradley Foundation. It helps explain why the Ewing Kaufmann Family Foundation ranks Wisconsin dead last for start-up activity, a situation that WEDC’s then VP of entrepreneurship and innovation acknowledged in 2013 by famously saying “We suck, we’re bad.” That same VP recently left WEDC to get back into the start-up game, and it makes you wonder what she saw at that slush fund agency that made her decide to get out of that job so quickly.

Then again, maybe that’s the way the puppetmasters like it in the Age of Fitzwalkerstan. After all, it’s easier to stay on top when there’s less of a chance of competition beating you and forcing you to keep your game sharp. And the Fitzwalkerstanis (along with those who vote for them) see no problem with having mediocre people with high status stay in those spots, no matter how much it holds the rest of the state back.

Monday, November 9, 2015

Shouldn't Wisconsin's economic record be part of tomorrow's GOP debate?

As some of the nation’s eyes turn to Wisconsin for tomorrow night’s GOP debate in Milwaukee, it may be worthwhile for the national media to look around and see what’s going on in this state. After all, Wisconsin has been one of the biggest test cases for GOP policies since Scott Walker and the GOP took over power at the Capitol following the 2010 elections, and we should be seen as a preview of what a GOP-run America might look like should the Republicans win in 2016.

One thing that should be noticed is that Wisconsin has had a number of large-scale layoff announcements in recent weeks, including last week’s closing of the 1,250-employee Oscar Mayer plant in Madison. But Oscar Mayer is far from the only mass layoff here, as recent weeks have also seen a 300+ layoff at a cheese plant in Plymouth, nearly 300 more were put out of work at a cookie-making plant in Ripon, and just last week, we found out 175 white-collar jobs at S.C. Johnson are being moved from Racine to Chicago.

In all, Wisconsin is on pace to nearly double last year’s number of mass layoffs, and this chart from UW Professor Menzie Chinn at Econbrowser shows that this gap has been persistent throughout 2015 in Wisconsin, but that it has been growing in recent months.

Walker has shifted his tone with these news of these recent layoffs, from insisting that government policy is something that can make Wisconsin “open for business”, to shrugging his shoulders and claiming that S.C. Johnson moved those jobs to Chicago because “it could better compete” for the sales and marketing positions in Chitown than in Wisconsin (there’s a vote of confidence in your state!). Walker also penned a whiny, angry letter to "Democrat legislators" after the Dems asked why the Walker Administration and the Walker-created Wisconsin Economic Development Corporation (WEDC) seemed to be caught by surprise with the news of Oscar Mayer leaving. In doing so, Walker claimed that there wasn’t a lot that the state could have done to prevent Oscar Mayer from closing, and instead tried to prop up the current state of Wisconsin’s economy.
Overall, the State of Wisconsin is moving in the right direction. The unemployment rate in Wisconsin is down to 4.3 percent, which is a 14-year low. The labor participation rate is 67.4 percent, which is five points better than the national rate. And the unemployment rate in Dane County is 2.7 percent — the lowest in the state.
Sounds good on the surface, but Bruce Thompson at Urban Milwaukee dug deeper than Gov Dropout, and had a great write-up on Wisconsin’s economic record and status last week. In this column, Thompson asks why Wisconsin has lagged most of its neighbors for job growth since Walker and WisGOP came to power in 2011, as shown by this chart.

In addition, Thompson noted the real reason for the lower unemployment rate that Walker promotes - a drop in the state’s labor force, in contrast to a US labor that continues to grow in 2015.

Thompson also notes that Wisconsin has been one of the state’s that has bowed to the Koch Brothers sued the Environmental Protection Agency on its new Clean Power Plan that is intended to replace coal-based electrical plants with alternative sources. This makes him ask if this is a symptom of a state that refuses to innovate and try a new industrial model, not just in energy production, but other industries.
As I’ve written previously, even if past predictions of conservative opponents to the EPA proposal were taken at face value, the impact amounts to about one-third of one percent of the total U.S. economy and about two months of job growth for Wisconsin and the Midwest.

Meanwhile, what about the opportunity to be had [to adjust to the new standards]? Take the upper end of the estimate from the [Public Service Commission] –$13.4 billion. Much of it will be spent hiring people to build the systems needed to meet the new emission standards. A quick and dirty calculation indicates that translates into about 15,000 jobs.

Wisconsin is only a small part of the total spending, and thus the total employment generated. Where will those jobs be? Will they be in China, or California? Certainly they will not be in Kentucky given the public attitudes there. And how likely is it that solar, wind, or other companies whose strategy is countering global warming will try to expand operations in Wisconsin?

This suggests a possible explanation for why Wisconsin has underperformed. We have become a “can’t do” state. We have become fixated on costs, including sunk costs, not opportunity. A number of recent actions—including turning down the federal rail grant, attempts to sabotage the Milwaukee street car, and refusing to expand Medicaid—suggest that Wisconsin should be numbered among the can’t do states, obsessed with cost rather than looking for opportunity.
In addition, with GOP presidential hopefuls being likely to say they back further tax cuts, it might be useful to point out that Walker and the WisGOP Legislature have signed off on billions in tax cuts and unfunded spending on credits to reduce property taxes that go toward schools. Not only did these tax cuts fail to make Wisconsin a job-creating machine, it also has led to continual budget deficits that resulted in repeated cuts to K-12 and higher education, and caused hundreds of school districts around the state to go to referendum to raise their own taxes just to keep the lights on and buildings from falling down. (by the way, WisGOP legislators now want to limit that option as well, because they care more about the image of lower taxes than following the voice of the people. So much for being the “party of local control.”)

There has also been a deterioration of infrastructure to the point that Wisconsin’s roads are now rated the 3rd-worst in America by the US Department of Transportation. Just last week, the Legislature’s Joint Finance Committee went along with Gov Walker’s request to borrow another $350 million just to keep the state from falling even further behind on road projects, an effect of the refusal of Walker and the GOPs in the Legislature to raise gas taxes or registration fees to pay for those repairs.

And that’s not even going into the union-busting and wage suppression that have been a cornerstone of Walker/WisGOP’s economic "strategy," and how that has caused large shortages in the skilled trades and the classrooms, since the pay isn’t high enough to attract talent to those positions. Not that I’m counting on Neil Cavuto and company to give those facts to the GOP candidates or the viewing audience, but the low pay and low job prospects are an everyday fact for a large segment of Wisconsinites in the Age of Fitzwalkerstan, and many are simply leaving for a better chance elsewhere.

I’ll generally avoid watching the absurdity of Milwaukee’s GOP debate tomorrow, but I’d love to find out that the case of Scott Walker’s Wisconsin was brought up to these jokers hopefuls. Particularly, I’d love to hear the following question be asked:

"If the approach of cutting taxes, cutting regulations, and cutting wages is so successful, why is Wisconsin doing so poorly at adding jobs, and facing constant budget deficits? And why would we want to take that approach nationwide?"

Sunday, November 8, 2015

Strong October US jobs, Wis's lagging should be part of debate

Friday featured a surprisingly strong US jobs report, with a seasonally-adjusted 271,000 jobs added (268,000 in the private sector), and a slight drop in the unemployment rate to 5.0% despite an increase in the labor force (actually 5.05% to 5.03%). This was a relief after the last two months had combined for a total of 290,000 jobs (273,000 private sector), and October's numbers jumped over Wall Street's expectations of that lowered amount of job growth to continue.

The strongest sectors continue to be in various service industries, as the report from the Bureau of Labor Statistics notes
Employment in professional and business services increased by 78,000 in October, compared with an average gain of 52,000 per month over the prior 12 months. In October, job gains occurred in administrative and support services (+46,000), computer systems design and related services (+10,000), and architectural and engineering services (+8,000).

Health care added 45,000 jobs in October. Within the industry, employment growth continued in ambulatory health care services (+27,000) and in hospitals (+18,000). Over the past year, health care has added 495,000 jobs.

Employment in retail trade rose by 44,000 in October, compared with an average monthly gain of 25,000 over the prior 12 months. In October, job gains occurred in clothing and accessories stores (+20,000), general merchandise stores (+11,000), and automobile dealers (+6,000).
But there was also one other standout in October's report- construction work, which was up by 31,000 jobs for October. Interestingly, the vast majority of this was in the "nonresidential specialty trade contractor" area (+21,100), an area that barely counts for 1/3 of total construction jobs. Construction wages also jumped in October, with average weekly wages up more than $50 compared to September, an increase of nearly 5.2%. Maybe a lot of that is a one-time blip, but it sure indicates that employers are starting to pay more for those jobs nationwide, and maybe the WMC mentality of "suppress wages as much as you can" isn't one that's going to work in that field for the near future.

One sector that continued to struggle despite the great jobs numbers in October was manufacturing, which didn't add any of those 268,000 private sector jobs last month, and has lost a total of 27,000 jobs since July. And last week's news of Kraft Heinz closing 7 factories (including the Oscar Mayer plant in Madison) along with the continuance of an anti-export strong dollar won't help manufacturing grow jobs for the near future, so that's a dark cloud that needs to be looked at to see if it spreads further as the weather cools.

But manufacturing and the continued weakness in mining (due to low oil prices) were the only dark sides in this reports, which sets up an interesting contrast for Tuesday's GOP debate in Milwaukee. Will the Republican presidential candidates be asked this simple question.

"Here in Wisconsin, Scott Walker has put in a lot of the policies you espouse: lowering corporate and income taxes, cutting worker rights, deregulating numerous industries and limiting liability for lawsuits. By doing so he promised 250,000 jobs would be created in the first four years of his time in office. And nearly 5 years later, we know that if Wisconsin had merely kept up with the rate of job growth, they would have nearly 260,000 jobs."

"Instead, Wisconsin hasn't even added 160,000 jobs since Walker and Republicans have been in office. With that in mind, how would turning the nation's policies into something that resembles Wisconsin's policies be an improvement for the rest of the country? And why should Americans believe the current recovery won't be slowed down if you get into office?"