Thursday, December 31, 2015

2015's ending thoughts- and a 2016 preview

Seems odd that 2015 is already ending, but it'll be in the books in less than 12 hours, as I start to write this post. This place is still serving as a great outlet for reflecting on the horrors I find to be happening to my state, and keeping my (somewhat) sane.

I want to thank all of you who take time to read my ramblings in this hobby of mine. This site is consistently getting between 15,000 and 21,000 pageviews a month, from a wide variety of places (you know who you are), and I greatly appreciate your work in spreading the word ahead. Maybe it's a little hopeful on my part, but part of the reason I write these things are to try to show how small, seemingly arcane policy issues and economic numbers lead in to give a more complete picture about the way things are going in the nation, and especially in Wisconsin (and in Wisconsin, they're not going well). Once people learn the numbers and the context of the numbers, I'm of the belief that it can lead to movements and changes which start small, and then grow into something bigger. Sooner or later, the facts seep through to enough people - if the facts are able to get through.

That's where I hope me and many other bloggers and writers who do it better than I do can help, and change the conversation. It does seem that our state's media has improved somewhat in its covering of these issues in the last year, and has finally begun to be critical of Scott Walker now that he has been exposed as a loser on the national stage (which exposed our state's corporate media as losers as well), although they still seem to give Scotty the benefit of the doubt when he says something, instead of immediately calling "BULLSHIT!" But we still need to keep watching the watchmen of our state's corporate media, and a good example of why was shown in yesterday's Shepherd Express article, which rightfully calls out the Journal-Sentinel Politi-"fact" for its arbitrary and biased rulings.

I also wanted to reflect on this blog's most-read posts from the last year.

3. "As predicted, Wisconsin jobs numbers revised way down." March 5.

This was written on the date that the January Wisconsin jobs report came out, and more importantly, the benchmark revisions for most of 2014. And those revisions were large and negative.

Revisions to December 2014's total jobs numbers, Wis.
Private sector jobs -25,800
Total jobs -30,300

I also hammered on the Journal-Sentinel's ignoring of these revisions, and instead being a stenographer to the "Wisconsin is growing" propaganda from Scott Walker's Department of Workforce Development. This was while Walker was starting to ramp up his disaster of a 2016 presidential campaign, and the J-S was still in the role of willing accomplice to that campaign, wanting the clicks on their website as Walker was being built up nationally (yes, this was a long time ago). It's interesting how both Walker and his J-S cheerleaders would be exposed as frauds in the next 6 months, and now both have had to sheepishly try to save face after having their act be called out on the big stage. But we can't forget what both these groups have caused, and can't let them off the mat next year.

By the way, if the Quarterly Census on Employment and Wages is any indication, we will likely see another downward revision when the next benchmarking happens in a little over 2 months, although it'll likely be smaller than the 30,000 jobs that were reported away in March 2015.

2. "WisGOP trying to bankrupt local gov't through pension "reform"." September 7

This was written on Labor Day to draw attention to a horrible ALEC bill that was getting a hearing that week in the State Legislature, and the bill is clearly intended to mess with post-retirement benefits for public employees at the local level in Wisconsin. As noted in the Legislative Reference Bureau's write-up of the bill, it would
prohibit a local government from providing health care benefits to any employee hired on or after January 1, 2016, for use upon the employee’s retirement, including compensated absences but excluding the implicit rate subsidy, unless the cost of the benefit is fully funded in a segregated account, based on an actuarial study conducted at least once every four years or other method that complies with generally accepted accounting principles. The bill also provides that, if a local government dissolves a segregated account established for the purpose of providing such health care benefits, the local government must provide for the equitable distribution of the proceeds among the beneficiaries.
In addition to being yet another example of WisGOP overriding local control, it sets the stage for many a budget crisis at the local level, where they will be forced to choose between offering post-retirement benefits, and everyday services like snow plowing and police protection.

It's along the same lines as the stupid proposed constitutional amendment that would require the Wisconsin budget to be balanced under GAAP accounting, which seems to be a needless and reckless move when WisGOP policies drove up the GAAP deficit by 28% last year, to $1.8 billion, and that number will likely go higher under gimmicks in this budget. The local gov't post-retirement benefits bill has not advanced past the hearing stage as of this time, but the GAAP amendment passed a Senate Committee 3-2 earlier this month, and could be taken up by the full Senate in the near future.

And keep your eye open for any session-ending shenanigans in the next few months, because if WisGOP realizes they're going to lose control of the Capitol (either in the Legislature or in the Governor's Office), they may well put in handcuffs like this to screw over the Democrats who will try to clean up the budgetary mess WisGOP left behind. Vigilance will be needed with these backdoor maneuvers to put even more ALEC legislation into Wisconsin law, especially with the approval of Gov Walker and the State Legislature going down the tubes.

1. "Slight Uptick in Wisconsin Revenues Doesn't Fix Wisconsin's Budget Mess." August 26.

I wrote this in reflection to the release of the year-end revenues for Fiscal Year 2014-15, which showed the state ended up $71.4 million ahead of the (lowered) estimates that the Legislative Fiscal Bureau had released earlier in the year. This was being trumpeted by WisGOP and ignorant media as some kind of "success" for Scott Walker's policies, but any honest look at the figures in context showed that it was the result of merely being subpar instead of awful. In fact, Wisconsin's revenue growth for the last fiscal year was less than half the growth rate in revenues seen with the federal government, indicating that the Obama Recovery dragged Wisconsin's revenues into positive levels, and that if anything, Walker/WisGOP policies held our growth down.

I ended with these observations and a future warning.
The income tax falling short should be a major concern, as that reflects the lack of jobs and wage increases (perhaps at the expense of higher corporate profits?). Because income tax makes up more than half of the state’s overall tax revenues, this puts us a bit further behind the 8-ball for this fiscal year. Walker’s budget already counted on income taxes going up by 6.7% in 2015-16 before this income tax shortfall, and now it has to go up 7.1% just to stay on track…or nearly twice the increase we had for this fiscal year.

So my topline conclusion from today’s revenue release is that we’re slightly better off than we could have been, mostly due to the Obama Recovery continuing through June 2015. But we are still in a ditch when it comes to paying for future needs, and if the recent dive in the stock market translates into economic weakness (or even a drop in collections due to write-offs of stock losses), a budget that already relies on $1.1 billion in lapses will have even more cuts and adjustments that will need to be made. And that is the last thing Scott Walker and the Wisconsin GOP want to deal with ahead of the 2016 primary and general elections.
And Walker and WisGOP likely will have to deal with a looming budget crisis as a 2016 election issue, as income tax revenues continue to lag in the first half of FY16, which means any cushion that was put into the budget from this slight uptick in revenues would be gone by this June. With new revenue projections coming out in the next month from the LFB, we may see action need to be taken much sooner than Walker and WisGOP would like, and that's on top of $740 million in lapses that are already built into year 2 of the budget.

Interestingly, the corrupt slush fund of WEDC didn't make this list of top 3 posts, but you can bet there will be more of that to read about in 2016. Especially since Assembly Speaker Robbin' Vos is insisting that WEDC is running just fine, and doesn't plan to work on major changes in the next year, except for possible giving even MORE taxpayer money to WEDC. Although in fairness, WEDC was set up to be taxpayer-funded boodle for WisGOP campaign contributors instead of something that actually improved our state's economy, so maybe Vos is being more truthful than the WisGOP puppetmasters would like him to be.

So as we turn the clock over to 2016, let's see if we can reverse the downward course this once-great state is in next year, and turn it back to somewhere that people want to relocate to, instead of a place where talent seems to be fleeing right and left. It can be done, we just have to choose the leaders and polciies that make it happen (i.e.- the complete opposite of what we have today).

I wanted to thank you once again for reading, and there will be more to hear from me (and hopefully you) in the next year. And yes, it seems fitting to bring this one back, and return this tune to its original, darker intent.

Badgers play classy in San Diego

That was a great win, and yes, I was up for all of it past 1am (at a bar with friends, as I didn't want to wake my wife). I've ripped Joel Stave in the past for inconsistency or turnovers, but there was none of that last night. Stave was very accurate, had zero turnovers, and Badgers outplayed USC up front, especially on defense. Really strong effort from a tough group of guys who overachieved to win 10 games, given all the injuries and youth this team had. This team feels like it's in a stable, strong situation long-term, and that's a lot more than I can say about where it was last December (even before Andersen left as head coach).

I just wish the WisGOP politicians I see Tweeting out support for the Badgers' athletic success felt the same desire to support the very university that makes Badger sports possible.

Wednesday, December 30, 2015

For Walker spokesmodel, story's source > over story's facts

As a 2-time graduate of UW-Madison, I took extra notice of this Wisconsin State Journal article from Sunday discussing how UW faculty is being recruited by universities in other states, and a main reason many UW faculty members might listen goes right back to actions from the Walker Administration and the WisGOP Legislature.
UW-Madison has not said how many faculty campuswide have been recruited by other institutions. But its College of Letters and Science — which averages about 30 retention cases per fiscal year — had already seen 42 this academic year, with what Mangelsdorf called “prime recruiting season” still to come in January, February and March.

Thomas Harnisch, director of state relations and policy analysis for the American Association of State Colleges and Universities, said Wisconsin’s budget cuts and changes to tenure and shared governance have been hot topics in academic circles, and were frequently covered in the national higher education press. That exposure could lead to the perception — one UW-Madison officials say they’re working against — that the university is vulnerable to raids on its professors.

“The changes in Wisconsin over the last year have really caught the attention of higher education officials nationwide,” Harnisch said. “They may well see this as a great opportunity to land some faculty members from Wisconsin and bring them to their campus.”

Top faculty often hear from universities that want to lure them away from UW-Madison, and many factors beyond a state’s political climate affect professors’ decisions to stay or leave. But political science chairman David Canon said the events of the past year could make faculty more receptive to other universities’ recruitment efforts.
So what does the Walker Administration say when asked about whether there might be a connection between UW faculty being recruited and the anti-UW policies that were passed into law in 2015?
Laurel Patrick, a spokeswoman for Gov. Scott Walker, questioned whether the impacts UW officials claim the budget is having on faculty are accurate, or if they were “unsubstantiated anecdotes from sources that are hardly unbiased to the situation.”
Keep that thought from Ms. Patrick in the back of your mind, and recall another story from earlier this month that dealt with two state employees that were literally screwing around while on the clock at work.
The documents show that the relationship left other employees uncomfortable and that the couple traded workday emails with graphic details and with the suggestion that an air mattress be brought to a secluded spot within their state office.

Gov. Scott Walker cited this incident in September when he called for overhauling Wisconsin's long-standing civil service system, saying these rules had kept state managers from firing two employees who had had sex on state property.

But files released to the Milwaukee Journal Sentinel under the open records law show no attempt by an appointee of the Republican governor to fire the two state employees or to give them any form of discipline other than letters of reprimand. On the contrary, the records show that Railroad Commissioner Jeff Plale softened the reprimand letters after the workers objected to an earlier version of them.

In addition, Plale, a former Democratic senator, then agreed last year to removing the reprimand from the personnel file of Elizabeth Piliouras, who had been railroad commission liaison at the time of the incident.
By the way, this is where I'll remind you how Jeff Plale got his job- by voting against contracts for state workers at the end of 2010, which allowed Walker to set up the false "crisis" that led to the imposition of the union-busting Act 10. And that this civil service bill would lead to a lot more Jeff Plale-like hacks throughout all departments of state government.

So what did Laurel Patrick say when she was confronted with the reality behind the dishonest anecdote Gov Walker shared to the WisGOP legislators?
Walker spokeswoman Laurel Patrick said in an email to The Associated Press on Friday that the workers' story, detailed Friday by the Milwaukee Journal Sentinel, illustrates the need for a bill that would reform the civil service system.
So after being told that the appropriate measures to fire these two people could have been taken under the current civil service system, human marionette Laurel Patrick is still insisting that "reform" is needed to "solve" this problem that we now know doesn't exist.

In other words, Laurel- if it's some cronyist legislation that you and your boss Scotty want the rubes to swallow, then “unsubstantiated anecdotes from sources that are hardly unbiased to the situation” are perfectly fine to use to manufacture support for such legislation. But when it comes to actual UW officials telling the Walker Administration what actual UW faculty are dealing with, and that they need to raise pay and benefits to compete with out-of-state universities, then those are just people trying to slant things to their side of the story. Got it.

With clowns such as Laurel Patrick and the rest of her bosses at the Wisconsin GOP showing such an aversion to outside input and a refusal to deal with reality, is it any wonder this state is struggling to keep talent? And is it any wonder why we keep lagging our Midwestern neighbors and the rest of the country when it comes to economic growth?

UPDATE- Oh, and look what just hit. The Wisconsin DOT stiffed Scott Walker's security detail on overtime, and now taxpayers will have to shell out over $570,000. Oh, but it's the civil service that needs to be changed, and not the selfish, incompetent elected officials and administrators that they appoint. Riiiiight.

Monday, December 28, 2015

What Bobby D doesn't know about Milwaukee's winter road costs

As the snow and freezing rain falls throughout the state (the drive home from work here in Madison was quite the treat), it leads me to recognize a winner of the “Nice timing, dipshit” award for today. It goes to Milwaukee Alder and Mayoral candidate “Bathroom Bob” Donovan. This throwback to the 1970s (and not in a good way) loves to legislate by press release and AM talk show blubbering vs working out any real solutions to the City’s problems, and what Bobby sent out last Wednesday was a great example.
I applaud Mayor Barrett for using some common sense and lifting the winter parking restrictions through January 1, 2016. And he certainly looked Santa-like in making the announcement yesterday, with his red jacket, red tie and that silver hair.

(To be honest I am disappointed the winter parking move by the mayor still requires those affected by alternate side parking to comply with those requirements, and Santa will still need to check those signs before parking his sleigh!).

But I say there’s no need to stop there, as we’ve just approved charging our beleaguered property owners a hefty annual snow and ice fee – when there’s no snow and no signs of ice!

I will be exploring legislation to give city property owners a snow and ice fee rebate – at the very least a percentage rebate – and I’m hoping the mayor will join me in support of this “giving” move.
There is plenty of absurdity in Donovan’s proposal in giving a rebate for the city’s snow and ice fee, which is levied based on property frontage (at $0.9155 a foot) and is projected to raise $8.74 million that is earmarked for the duties involved in removing snow and ice (taking these services off of the property tax). This amount is the same as it was in 2015, as you can see on Page 154 of the City of Milwaukee’s budget document (page 178 in the PDF). Here are two ways that Donovan’s proposal makes little to no sense in the above-ground world.

1. A local government like the City of Milwaukee runs on a calendar year basis, which means the 2016 snow and ice fee is being levied for the next 12 months, not paying for the services that were given out in 2015. Donovan’s observation of “no snow and no signs of ice” in Milwaukee is only a benefit to the 2015 City budget, not the 2016 one (in addition to today’s weather blowing up the “no snow/ice” part of Donovan's statement). In fact, the first half of 2015 did not unusually lack for snow in Milwaukee, as this NOAA chart shows.

As you can see, Milwaukee was about 8 inches behind the average snowfall amount on January 1 for last winter, but only ended up around 5-6 inches behind when the winter of 2014-15 ended. Even the 2015-16 season was ahead of normal amounts of snow until early December, courtesy of that big snow that hit the weekend before Thanksgiving, and Milwaukee was only about 5 inches of snow behind schedule until today. That doesn’t seem to translate to major savings to me (although I admit I haven’t seen the snow and ice cost numbers).

2. Obviously no one knows how much snow removal or related winter maintenance work will be needed for next year at this time, which makes the fee a moving target in each year it is set. To give back some of the 2016 amount in summer if the snow removal needs stay low, as Donovan is suggesting, could mean that snow operations would be shortchanged in November and December of next year, if Milwaukee’s winter comes early and/or heavy at that time.

So you can see how Donovan’s suggestion to give Milwaukee property owners a payback on the 2016 snow and ice fee is foolish due to the calendar-year basis for City budgeting. He is either displaying a sickening amount of cynicism in trying to play on the emotions of the dwindling number of Archie Bunker types who buy into his BS, or it’s an absurd amount of ignorance of reality in both budgeting and Milwaukee’s weather (in Bobby D’s case, it could well be both).

Now will this reality be explained by our media or by AM radio hosts the next time Donovan opens up his obnoxious yapper? Of course not. But that doesn’t change the fact that unless Donovan has hard proof of major funds not being used by the snow and ice fee in the last 2 years, this idea of a rebate is as ridiculous as…well…Bathroom Bob Donovan.

Sunday, December 27, 2015

Slow population growth shows another way Wisconsin is suffering

I would like to thank fellow Tosa East graduate Todd Milewski for drawing my attention to the recent Census Bureau projections of population change. This report came out late last week, and Milewski notes that Wisconsin's population growth slowed down last year to rates that were less than half of what we were getting 10 years ago.
In a report released this week, the U.S. Census Bureau estimated Wisconsin's population as 5,771,337 as of July 1, 2015, an increase of 11,905 over the 2014 estimate.

The yearly growth rate fell to 0.21 percent in 2015; it was 0.27 a year earlier and 0.58 percent in 2005.

During the 2010s, Wisconsin has averaged an annual growth rate of 0.3 percent over the official decennial census population figure, a notable decline from earlier decades. In the 2000s, the annual growth rate was 0.6 percent, and it was 0.96 percent in the 1990s.
Milewski's Capital Times article also includes this chart, which shows the downward trend of the state's population growth in the last 10 years.
This drove me to look into the actual Census report to go inside the numbers a bit more, and a couple of items stand out. First of all, you can see why Scott Walker and WisGOP constantly tries to talk about Illinois when discussing Wisconsin's economic and demographic statistics, and not anywhere else in the Midwest. Because much like with job growth, The Census Bureau says Wisconsin lagged many other Midwest states when it came to population growth in the last year.       

Population growth number, July 1, 2014 to July 1, 2015
Minn +32,469
Ind. +21,800
Ohio +16,425
Iowa +14,418
Wis. +11,905
Mich +6,270
Ill. -22,194

 Population growth percentage, July 1, 2014 to July 1, 2015
U.S. +0.79%
Minn +0.59%
Iowa +0.46%
Ind. +0.33%
Wis. +0.21%
Ohio +0.14%
Mich +0.06%
Ill. -0.17%

You can't help but notice Minnesota topping that list while we linger in mediocrity. And it doesn't take much of a stretch to connect these two stats together when you look at the net migration numbers, which Wisconsin also does not fare well in. All Midwestern states had more people moving out to other states vs people moving in from other states, but Wisconsin had more than most. I'll also include the net migration figure as a percentage of the 2014 population, since logically places with more people living in it would be likely to have more people moving out.

 Net domestic migration, 7-1-2014 to 7-1-2015
 Iowa -3,949 (-0.13%)
 Minn -12,242 (-0.22%)
 Ind. -14,881 (-0.23%)
 Wis. -15,568 (-0.27%)
 Ohio -31,297 (-0.27%)
 Mich -38,911 (-0.39%)
 Ill. -105,217 (-0.82%)

In fact, Illinois' huge out-migration likely masks Wisconsin bad record in this statistic, since Wisconsin likely grabs more FIBs than residents they lose to Illinois. So this should concern policy-makers, as people leaving town is obviously going to limit Wisconsin's ability to grow. But Scott Walker and the WisGOPs in the Legislature seem to have no interest in changing this trend, and in fact, are likely adding to it, because of their policies of low pay, defunding education, and regressive social legislation.

This Census Bureau report from last week is yet more evidence to me that the state is going in the wrong direction, and that there must be a change in leadership to stop the bleeding. Demographics matter, and Wisconsin is increasingly on the wrong side of them.

Saturday, December 26, 2015

Tim Cullen's Ringside Seat to Capitol doings

My wife got me former State Sen. Tim Cullen's new book Ringside Seat , and it's a great read if you care about how state government works. Apparently, it's selling very well, as my wife indicated the local bookstores were having trouble keeping it in stock before the Christmas holidays, which is a nice sign that people are caring about items in a book that often deal with arcane "inside the Capitol issues."

In Ringside Seat , Cullen often contrasts the way the state was run in the '70s and '80s with the partisan, dysfunctional way it's operated in the Age of Fitzwalkerstan. Yes, there is a decent amount of the book devoted to the Act 10 fight (Cullen was one of the "Wisconsin 14") and even includes the full transcript of Governor Walker's infamous "David Koch phone call." In that call, Cullen was mentioned by Walker as "pretty reasonable but not one of us," and Walker also admitted to "Koch" that he planned to use Cullen as bait to appear like he was interested in negotiating, when in fact Scotty had zero plans but to follow the desires of ALEC/Koch interests and hardline GOP partisans that pushed Act 10 for political advantage (and make no mistake, Act 10 was a political move that had next to nothing to do with balancing budgets).

But what I find interesting in the book is how Cullen contrasts the way the State Legislature ran things in 1975, when he began his first term in office, and compared it to how things look when he left for good this January. Cullen mentions that 30 and 40 years ago, while there were differences between the state's Democrats and Republicans, there still was enough of a general consensus on core issues which did not cause the bitterness and rash behaviors that we see today. There also was a willingness to defer to the people on key issues and use the people's input to form policy.
Wisconsin state government for at least 60 years before Scott Walker became governor was a "participatory" government. Governors went out of their way to involve citizen groups in studying proposed changes to state government. A key element of this "participatory" approach to governing was to not spring "surprises" on the people of Wisconsin. I believe this had become a "given" in the expectations of most citizens for how their governor would do his job. They often used "blue ribbon commissions" or other panels that were composed of citizens from all points of view on the topic being studied.
Cullen goes on to contrast the number of Governor's Commissions appointed in the last 45 years, and it dwindles from an average of 5-6 from the 1970s through the Tommy Thompson years, down to 3 a year under Jim Doyle, to barely 2.5 a year under Walker. In addition, Cullen points out that Walker has yet to appoint ONE of those "Blue Ribbon Commissions" in his nearly 5 years in office, and completely ignored the recommendations of the few commissions that were created, such as the Transportation Finance and Policy Commission's report from 2013.

Another way Cullen says that things have changed over the last 40 years of Wisconsin politics is how power was consolidated with the party leaders in the Legislature, and reduced the ability of legislators to be independent and district-based (this makes sense, do you think Robbin' Vos gives a flying fuck about the needs of people in Rice Lake or Reedsburg?). In addition, Cullen says that legislative campaigns and staying in power have become more important than doing casework for constituents, and a lot of that has to do with the influx of big money and special interests that now dominate state politics.
Republicans have a big problem, only worse now because they are in the majority. Their interest groups know they have the votes to deliver whatever the interest group wants. Republican leaders can't walk away from WMC, the Koch brothers, mining companies, the NRA, school vouchers supporters, on any issue those groups want. It's interesting that the legislative leaders have centralized the power in themselves in regard to running campaigns and fundraising, but then have lost control of the process to those that have all the money. Their power over their colleagues then comes by appeasing those who give the big money to the campaign. Here's the irony. Those [legislative leaders] who wanted to centralize power wound up losing it. Power is now in the hands of a relatively small number of groups with huge chunks of money. The legislative leaders took power from their members but then lost it to the money!...

No staffer when I was at the Capitol in the 1970s and 1980s raised money. It was unheard of. When that changed, it led to the centralization of power. The more staff leadership would send out there, the more money that needed to be raised, and the more money that could be raised, the more beholden the leadership is to the contributor. You start having elected officials going to Madison who were beholden to their leadership on their first day in the Legislature. The leadership had their claws in them on day one.
Cullen also makes an intriguing point in Ringside Seat where he points out that very few State Senators these days come directly from the private sector or local government level, but instead were State Representatives first, and ensconced into the ways of the Capitol and party leadership before going into office (25 of 33 State Senators in 2012 had previously been Reps, Cullen says that same number was 11 of 33 in 1978), Cullen finds this to be a distressing development, which I find interesting because a top-ranking Democratic official told me earlier this year that one of the things the party wants out of State Senate candidates is prior experience in the Assembly, because it makes them more likely to win. Maybe that explains something about the current minority status of the Democratic Party of Wisconsin, compared to their general dominance of the Legislature in the '70s and '80s.

It's not all doom and gloom from Cullen, as he has confidence Wisconsin will find its way back from the mess of Fitzwalkerstani governance that has made the state take a different course from where it previously went. Cullen concedes that this restoration takes time, and I think his confidence may be the mark of a man who comes from an older generation that used to see the benefits and consequences of policy first hand, leading them to work out their differences over those policies, instead of retreating to their bunkers and refusing (or not having to) listen to the needs of the people that are allegedly being represented.

I'm not so sure we ever come that close to getting all the way back to the era of 1970s and '80s consensus that Cullen describes. The right-wing media Bubble has taken hold in far too many places of the state for a common compromise to be reached with these radicals, and the areas many of those legislators from suburban Milwaukee and Racine "represent" are too gutless set in their voting habits for much negotiation and reasonable legislation to happen. The only way I see a major change happening is for the GOP to get its ass kicked statewide in both 2016 and (especially) 2018, with a Democrat taking over as governor, which would guarantee the end of gerrymandered districts after 2020.

Then, and only then, do I see things getting righted in the relatively near future to the general consensus that Cullen talks about in Ringside Seat. And even then, I have doubts we ever regain the clean government and high quality of life that we used to take pride in for this state. I fear the money and special access that it buys has gotten too big, and barring a national reform movement that changes campaign finance for all elections, we're going to remain damaged by the dark, corrupt Age of Fitzwalkerstan.

Friday, December 25, 2015

Here's your Holiday economics talk and entertainment

Merry Christmas to my 10 loyal readers. Here's Robert Reich with some good, wonky suggestions for how you can handle those uncomfortable economics conversations with your grumpy relatives and out-of-town friends this holiday season.

I might have thrown in a few profanities and "Follow the money to the campaign contributors" lines, but that's pretty good from Professor Reich.

Speaking of economics that makes you think, I highly recommend seeing "The Big Short," as me and my wife did yesterday afternoon. It's a great reminder of what a casino Wall Street was...and still basically is. It also is a great reminder how these amoral slimeballs on Wall Street and DC stole from us all, and that the failure to hold those criminals to account is something that explains the crippling inequality and underlying anger we're dealing with today.

Thursday, December 24, 2015

Revenues slightly low, but not a disaster...yet

Interesting how the "Holiday dead zone" of news coverage has become a good time for the Walker Administration to catch up on their overdue financial reports. Another example of this was the November revenue report from the Wisconsin DOR, which was released on time this Tuesday afternoon. What, you missed it? Well, that might have been the plan, although the overall picture wasn't that bad (with one glaring exception)

Wisconsin revenues Nov 2015 vs Nov 2014
Adjusted income tax -0.7%
Sales tax +6.6%
Corporate tax +$11.0 million
Excise tax -0.6%
Other +0.2%

That may sound OK at first glance, but the 2015-16 budget has a 4.6% increase in revenues built into it. And that strong sales tax figure could be misleading, as Cyber Monday fell in November this year, but didn’t happen until December 1 in 2014. Ruh roh.

When you plug in the totals for first 5 months of the fiscal year vs this time last year, the combined amount of sales taxes, corporate taxes, excise taxes and other taxes are largely in line with the figures in the state budget (barely behind, but we’ll say “in line” for argument’s sake). However, we also see that income taxes are running low, leading the possibility of a revenue shortfall, given that income taxes are more than half of overall General Fund revenues.

Fiscal Year 2015-16 through November Income tax UP 5.12%
Fiscal Year 2015-16 budgete change in Income tax vs 2014-15 UP 7.09%
Shortfall 1.97%
1.97% shortfall in income tax = $158 million.

That's not so good, and even worse, it sets things up for a larger shortfall in the second Fiscal Year of the budget, because we'd start from a lower base. Yes, the 2015-16 Fiscal Year has $297 million of cushion built into it ($161.8 million in the finalized budget, and then adding in the $135 million+ year-end balance), which makes it unlikely (for now) that we would need a budget repair bill for this fiscal year. But it does mean that year 2 is on track to end up with a deficit, and that's after the $740 million in unspecified lapses are built in, which means furloughs and other in-year cuts would be virtually guaranteed if the lower trend in revenues would continue.

I'd say it's not yet time to hit the panic button, but it is time to start preparing yourselves for the possibility that it will have to be hit. This may become especially true when the Legislative Fiscal Bureau releases updated projections next month, which will cover the rest of this fiscal year as well the 2016-17 one. Because with a slow-growth U.S. economy and slow growth in Wisconsin revenues, it'd be more likely that the projections would go down vs going up, and that would mean more immediate action would be required.

Wednesday, December 23, 2015

The WARNing about the state's unemployment claim stats

In the wake of the announcement of the Oscar Mayer plant closing in Madison, Assembly Democrats and others have questioned the direction of the state’s economy. In a press event last month, Katrina Shankland, the Number 2 Dem Rep. in the Assembly, claimed that Wisconsin was “on pace to double layoffs since 2014,” citing evidence from the state’s WARN notices.

To backtrack for a second, the Worker Adjustment and Retraining Notification (WARN) Act requires the State of Wisconsin to be notified if there is a large-scale layoff at a business, to help the state’s Department of Workforce Development move resources to help workers that may need assistance after such a massive job dislocation. The U.S. Department of Labor has a nice fact sheet which shows when WARN notices must be given.
What Triggers Notice

Plant Closing: A covered employer must give notice if an employment site (or one or more facilities or operating units within an employment site) will be shut down, and the shutdown will result in an employment loss (as defined later) for 50 or more employees during any 30-day period. This does not count employees who have worked less than 6 months in the last 12 months or employees who work an average of less than 20 hours a week for that employer. These latter groups, however, are entitled to notice (discussed later).

Mass Layoff: A covered employer must give notice if there is to be a mass layoff which does not result from a plant closing, but which will result in an employment loss at the employment site during any 30-day period for 500 or more employees, or for 50-499 employees if they make up at least 33% of the employer's active workforce. Again, this does not count employees who have worked less than 6 months in the last 12 months or employees who work an average of less than 20 hours a week for that employer. These latter groups, however, are entitled to notice.
With the most recent WARN report for Wisconsin, dated last Friday, December 18, the state at just over 11,700 large-scale layoffs for 2015, vs a little over 7,200 in all of 2014. Not quite double yet, but likely to be reasonably close to it by the end of the year (especially if you count the over 1,000 people slated to lose their jobs at Oscar Mayer, which is not included in that 11,700+ number).

However, Wisconsin Politi-fact took a look at Rep. Shankland’s claim of "layoffs doubling" and said that it was "False." . With that in mind, I wanted to look into that ruling, and then go inside the numbers they use as well as other numbers to see if this ruling makes sense.

Here is Politi-fact’s argument. They say that WARN notices should not be used as an indicator of actual layoffs, and aren’t even that big of a factor when it comes to assessing the overall economy or total job losses.
In some cases [with WARN notices], layoffs take place immediately. In other cases -- such as with Oscar Mayer -- the plant closing is expected months later. In still others, they never take place.

So the numbers don’t represent actual layoffs. As such, experts say they are a lousy tool for assessing the state’s economy….

Our rating

Shankland said Wisconsin "is on pace to double the number of layoffs this year."

She cited layoff notices received by the state. But those aren’t actual layoffs. And while she’s about right on the number of notices received, she’s wrong to suggest that the employment numbers are headed downward this year.

In the time frame she cited the state’s added about 30,300 jobs. We rate the claim False.
Actually, job growth is heading slightly downward (as I pointed out last week), but we aren't losing jobs on a year-over-year basis, so I get where Politi-fact is trying to go. In addition, the total number of unemployment claims has been consistently lower on a year-over-year basis in 2015 vs 2014 in Wisconsin, which underscores the differences between mass layoffs and overall layoffs.

Sure, if a Republican said the same thing as Shankland did, I have no doubt Politi-“fact” would have found a way to turn it into a “mostly false” or “half true” (arguing, “well, she did mean mass layoffs……”), but I’ll agree things aren’t as disastrous economically as Shankland’s words would make them appear (“THANKS OBAMA!”).

However, note the part about Oscar Mayer in Politi-fact’s analysis, because it also gives a hint that things aren’t as good as the state’s reduced unemployment claims would indicate. Many of these pre-announced layoffs and plant closings haven’t happened yet, and many of those who lost their jobs have been receiving severance pay from the now-former companies, so they haven’t filed for unemployment as of this time.

That non-filing situation might change soon enough, which likely means unemployment claims will go up in Wisconsin during the early part of next year (even more than we usually see with the end-of-Holiday seasonality and cold weather). If those people that were laid off aren’t finding work to replace the jobs they lost, THEN you will see the real damage in the economic statistics for the state of Wisconsin, and Rep. Shankland’s claims might even pass the Politi-“fact” muster.

There is also something else that we should be skeptical of when we look at the state’s unemployment claim numbers. Workers in Wisconsin struggled to file their claims a couple of years ago using the state’s phone system, resulting in 1.7 million calls from people trying to get benefits being unanswered and later dropped in Fiscal Year 2013-14. Despite assurances that Scott Walker’s Department of Workforce Development fixed that problem, and that there aren’t any more calls being dropped, there has been no major follow-up report in the last year confirming that.

In addition, Walker and the GOP-run State Legislature has put up increasing barriers to citizens trying to file for benefits, including adding a one-week waiting period to receive benefits and requiring a drug test before getting unemployment. Both moves could keep some unemployed people from receiving benefits that they would have received in the past, or keep them from making the extra effort to apply even though they are entitled to do so.

Given that we already know that this administration came up with reasons to cut 15,000 people off of food stamps, despite there not being jobs available to get them off of assistance, is it unreasonable to think there might be a similar attitude out there to deny certain people from the unemployment benefits? Especially since a rise in unemployment claims would make the Walker/WisGOP leadership look bad, and go against their “It’s Working” spin?

In other words, just because Politi-“fact” decided to shoot down a claim from State Rep. Katrina Shankland on layoffs doesn’t mean it allows the GOP to claim there isn’t a problem. And it doesn’t mean that more shoes may well drop in 2016 that makes those claims of Wisconsin’s economic despair a lot more true.

Tuesday, December 22, 2015

Walker "comeback" spin leaves out one's reality

Think Gov Walker isn't feeling the heat from all of the layoff announcements, scandals and Capitol incompetence that keeps coming out of this state? His handlers He came up with this desperate column over the weekend called "The Wisconsin Comeback" where he tried to convince an increasingly skeptical public that Wisconsin is really going in the right direction (and the comments with the column indicate people aren't buying it). The article included Walker taking credit for things Wisconsin already excelled in before he took office, such as ACT test scores and health care quality, and also included a few claims about job growth.
A recent revised report from the federal government shows that the unemployment rate in Wisconsin is the lowest it has been since the spring of 2001. The 16,600 new jobs created in the month of October is the best monthly jobs gain since April of 1992 and the best October since at least 1990. And the 45,100 new private sector jobs added October over October is statistically significant.

In addition, Wisconsin has one of the highest labor participation rates in the country. At 67.8%, our state is more than five points higher than the nation. More people are working in Wisconsin in 2015 than at just about any time in the past.
A couple of points to make before I go deeper into the numbers. 1. The high labor participation rate is something Wisconsin has had for years, and has actually gone down since the start of this year, as this recent in-depth article from Bruce Thompson in Urban Milwaukee shows. 2. The "recent revised (sic) report from the federal government" is the state-by-state jobs report from the Bureau of Labor Statistics, and those figures that were just released dealt with November, not October.

So why didn't Scotty talk about the November jobs numbers? This is why.

Change in jobs, Midwest November 2015
Iowa +9,000
Ohio +7,000
Minn +6,200
Mich +3,500
Ind. +3,400
Ill. +300
Wis. -3,800

That stat also helps explain why Walker quotes the October year-over-year figures on job growth, because the 12-month growth in November nearly 13,000 jobs less than October's number, at 32,400. And Wisconsin doesn’t measure up so well compared to our Midwestern neighbors when you use that stat, as only the ongoing fiscal and governmental train wreck in Illinois is keeping us out of the cellar for this part of the country.

Year-over-year private sector job growth, Nov 2014-Nov 2015
Mich +2.20%
Iowa +2.17%
Ind. +2.09%
Ohio +1.54%
Minn +1.47%
Wis. +1.32%
Ill. +0.76%

And while the Walker Administration tries to prop up the 4.2% unemployment rate as a sign of success, it's another context-free cherry pick job because 1. The U.S. is at its lowest unemployment rate in over 7 1/2 years, and 2. Wisconsin's low rate is as much a reflection of fewer people looking for work as it is any sign of growth (as noted in the participation rate dropping). What's worth looking into in the monthly household survey that includes the unemployment rate is also the number of people in that survey that say they are working. And interestingly, Gov Walker isn't talking about these specific numbers very much.

Change in “employed”, household survey Nov 2014-Nov 2015
Ind. +2.50% (+76,400)
Mich +1.83% (+81,100)
Minn +1.18% (+33,700)
Ill. +0.98% (+59,900)
Wis. +0.57% (+16,700)
Ohio +0.45% (+24,200)
Iowa +0.40% (+6,500)

Much of Wisconsin's drop in unemployment over the last 12 months is due to over 14,000 people leaving the work force in the last year, and had Wisconsin’s labor force had remained the same in the last 12 months, the unemployment rate would be 4.7% instead of 4.2%. This means workforce dropouts account for about half of Wisconsin's 1.0% drop in that time frame, but interestingly, Walker doesn't want to take credit for that part of the reality.

Look, I get that when your approval rating is in the 30s and falling, you gotta try to give people a shot of the confidence fairy to have them try to come back to you before they leave you for good, and that's why Walker wrote that silly column over the weekend and why he is doing so many (taxpayer-funded) photo ops at businesses these days. But it merely takes 30 minutes of research to shoot his story full of holes, and after nearly 5 years in office in Madison and over 12 as an exec, you'd think Scotty might be a little better at this game. Sorry kid, but I don't think it's working, and just like what happened in Milwaukee County, the majority are finally seeing through your act, and the jig is up.

Too bad for Scotty that he doesn't have any new job to jump to this time...outside of maybe an orange jumpsuit. It's just horrible that this state has had to be dragged down along with him, and that this guy wasn't left behind 13 months ago.

Monday, December 21, 2015

Budget deal illustrates why people are angry at Congress

Sometimes legislators show their true faces, and tell you what their real priorities are. 1 year before the 2016 elections, large majorities in both houses of Congress signed off on $629 million in tax breaks over the next 10 years in a Christmas Tree of a budget bill last week. This bill will expand budget deficits while making permanent many breaks that affect very few people, and indicates that apparently the Republicans that head up Congress aren't as interested in lowering budget deficits as they claimed to their constituents in recent years.

In addition to the headline parts of the deal, there were two examples shining through that only self-interested politicians and lobbyists could ask for. This first was tipped off to me in a Facebook post put up yesterday by State Rep. Gordon Hintz (one of the favorites here at the Funhouse).

I understand why all of the things get jammed into a spending bill. But if you look at whose interests were served, it is not difficult to understand why the public is cynical about government.

Posted by Gordon Hintz on Sunday, December 20, 2015
And here are some of the special goodies that Eric Lipton and Liz Moyer describe in the New York Times article Rep. Hintz links to.
David Bonderman, a founding partner of TPG Capital, which has large holdings in companies that stand to benefit from the last-minute change. His family has donated $1.2 million since 2014 to the Senate Majority PAC, a campaign fund with close ties to Mr. Reid and other Senate Democrats.

Some executives at companies with the most at stake are also big campaign donors. For example, the family of David Bonderman, a co-founder of TPG Capital, has donated $1.2 million since 2014 to the Senate Majority PAC, a campaign fund with close ties to Mr. Reid and other Senate Democrats. TPG Capital has large holdings in Caesars Entertainment and helps run a Texas-based energy company, both of which stand to benefit from the last-minute change.

“For Senator Reid, it was important, as he represents Nevada, to help the large employers in his state,” said Kristen Orthman, a spokeswoman for Mr. Reid. She noted that Caesars, MGM Resorts International and Boyd Gaming, all Nevada-based casino companies, could benefit. A spokesman for Mr. Bonderman said he had played no direct role in pushing the cause, but did not dispute that his company was involved in the discussions with congressional staff members....

The effort to close the loophole was among many provisions in the $1.15 trillion spending plan and separate $622 billion tax plan that had special patrons. Language inserted into the federal budget over the objection of the Obama administration by Senator Thad Cochran, Republican of Mississippi, directed the Coast Guard to build a $640 million National Security Cutter in Mississippi that the Coast Guard says it does not need.

“If we are funded for it and Congress says you are going to have a ninth cutter, I guess that is how it goes,” said Chief Warrant Officer Chad Saylor, a Coast Guard spokesman. “But we are good with eight.”
Another part of the budget bill that should have been marked "for lobbyists and insider politicians only" was mentioned by Esquire Politics columnist Charlie Pierce, and it involves some of the tax evasion and donor-hiding that has been central to the John Doe controversy here in Wisconsin.
Buried in the budget deal that now has emerged from Congress is a provision by which the IRS will be actively forbidden from enacting new rules in 2016 to rein in the obvious scams in which most of the 501(c)4's engage. I don't care how loudly the flying monkeys howl at Speaker Paul Ryan for "betraying" them by striking a deal at all, this is the real joker in the deck, and the fact that this principle was so easily bargained away says a great deal about the people in power from both political parties. They have accepted the new reality of legalized influence-peddling and are finding ways to prosper in it. This, I guess, is another New Normal in our politics. Absent a constitutional amendment, campaign-finance reform legislation now appears to be as expendable in negotiations—and, therefore as dead—as sensible gun-control legislation is. But, as we always take pains to point out, we still have Justice Anthony Kennedy's assurance that "…independent expenditures do not lead to, or create the appearance of, quid pro quo corruption."

Not if everybody's in on it, they don't.
Gotta have priorities in Congress, you know? Especially when it involves allowing oligarchs to dodge taxes through fake charities, and avoid accountability to the law that actual taxpayers have to deal with. One of many ways that it pays to be in the inner circle, I suppose.

This is where I'll jump in and let you know that exactly ONE member of Wisconsin's 8-person delegation in the House voted against final passage of this bill- Democrat Mark Pocan from Madison (all 3 Wisconsin House Democrats voted against the unfunded tax cut part of the package). In the Senate, Dem Tammy Baldwin and GOP Ron Johnson both voted for this budget bill, claiming that there were enough good things in it to allow it to go through, and that it was preferable to having another government shutdown. In contrast, presidential candidates Bernie Sanders, Ted Cruz, and Rand Paul all voted against it, while Marco Rubio made the gutsy move of not voting on the bill at all (!).

There's also a darker reality to consider here. The more you have self-interested crap put into bills without politicians and corporations paying a price for doing these selfish deeds, the more this self-interested crap will continue. And with that selfish legislation comes the destructive public cynicism that makes average citizens say "They're all crooks," and turn off from being involved in politics.

Which is just the way the oligarchs want it.

Sunday, December 20, 2015

Scotty still doesn't know our "skills gap" is a wage and talent gap

Well this is a nice bit of confidence in the state of Wisconsin's workers from our dear leader.
Gov. Scott Walker says Wisconsin continues to rank relatively low in job creation because not enough people are ready to join the workforce....

"Employers have increasingly told us, we've seen it even in some of the Chamber (of Commerce) surveys, that until we can get more people in the workforce, employers aren't going to add more work until they can fill the positions that are vacant right now," Walker said.

He said he doesn't know many additional jobs be created but pointed out that Wisconsin ranks relatively high in the percentage of people in the workforce.
I understand that school and facts didn't exactly treat you well, Governor. But you might want to note this stat from the recently-released Quarterly Census on Employment and Wages, and I think it might help you identify a source of this problem.

Average weekly manufacturing wage, QCEW June 2015
Ill. $1,183
Mich $1,181
Minn $1,124
Ind. $1,101
Ohio $1,063
Wis. $1,022
Iowa $1,021

So manufacturing workers are making an average of more than $100 a week in 3 of the 4 states bordering Wisconsin. If you were a skilled worker, and you had a choice of working in those 4 states, would you pick the place that paid you the least?

The answer is obvious, Scotty. You want to get more people into the skilled labor work force in Wisconsin, and fill those vacant positions? Why don't you tell the "employers" and Chamber of Commerce members to pay a competitive, higher wage. And how about not promoting wage-suppressing measures like (right-to) work-for-less, and getting rid of prevailing wage requirements on local road projects?

If you don't understand how these two items are connected, you are too incompetent to be running a hotdog stand, let alone our state. I'd also encourage you to read this letter that appeared yesterday at from David Maki, an actual business owner in the Twin Cities.
I run a successful technology business based out of Minneapolis. Five years ago I was considering moving my family and business to northern Wisconsin. One reason I was considering the move is that northern Wisconsin is my ancestral homeland, and my parents and other extended family still live there. I had also recently inherited land which I intended to homestead.

My plans changed when it became apparent what a backward ideologue Gov. Walker is. I refuse to move my family and business until Walker's disgraceful tenure is over. Even then, the damage his administration has caused to the state of Wisconsin has made me reconsider my plans.

While I would still like to make the move for personal reasons, I'm afraid Wisconsin's reputation as a place that does not value education or forward thinking would tarnish my personal and professional reputation.
Maybe, just maybe, we should heed Mr. Maki's words, and do more to attract talent to the state. This seems better than the Scott Walker/WMC mentality of running things on the cheap without giving workers a say in their own futures, and then being confused when no one wants to work for such a bunch of regressive fools.

It's well past time to change the course.

Saturday, December 19, 2015

More Wisconsin QCEW stats- trending down

Wanted to follow up on Thursday's release of the Quarterly Census on Employment and Wages, with a couple of other looks at the data.

Not only did the June 2015 figures show a decline from the year-over-year increase in private sector jobs from the last report that ran through March, the 1.27% figure is the lowest since the end of 2013, and you can see a clear decline in growth levels starting around the start of this year.

It's also worth noting that over 4 years since the passage of Act 10, the state has still never reached the 1.90% growth in private sector jobs that we had in March 2011...the month that Act 10 was jammed through the State Legislature. This is despite the U.S.'s job growth picking up over the same time period, and I have a hard time believing those two events are happening in isolation.

In addition, Chris Walker at Political Heat took a step back and looked at the record of the last 4 years, and the record in Wisconsin isn't good, nor acceptable.
When looking at jobs growth from the start of Scott Walker’s first budget in June 2011, however, there’s no mistaking it: we ARE dead last overall in the Midwest.

Wisconsin ranks 37th in the nation in job growth from June 2011 to June 2015. During that time, our growth rate was about 5.73 percent over four years.

For comparison, Illinois had a four year rate of growth of 6.26, Iowa had a 6.70 rate, Minnesota had a 7.66 rate, and Michigan had a growth rate of 10.5 percent.
I'll jump off that point and compare the 12 months before Walker's first budget took effect (going through June 2011), and then look at the individual 12-month periods since.

Private sector job growth, Wisconsin
June 2010- June 2011 +39,909 (+1.70%)
June 2011- June 2012 +37,959 (+1.60%)
June 2012- June 2013 +27,752 (+1.18%)
June 2013- June 2014 +36,651 (+1.53%)
June 2014- June 2015 +30,759 (+1.27%)

Not really the direction Wisconsin needs to be going, is it?

Friday, December 18, 2015

GOP constitutional amendment wants to "fix" state budget that GOP messed up

After a week's delay, the Walker Administration dumped the annual Comprehensive Annual Fiscal Report (CAFR) for Fiscal Year 2014-15 this afternoon, . This report has gotten lost in the shuffle with all of the other Walker scandals emerging and John Doe getting taken to the U.S. Supreme Court, but digging into these figures show a couple of very intriguing numbers, and a reversing trend that directly contradicts a bill that WisGOP legislators are trying to jam through the Legislature before you know about it.

The CAFR has a number of accounting measures that are so arcane, I don't care to look much at some of them (and look at the arcane crap I write about in this blog). But it definitely has good information about the value of state assets, pension funds, and also a number of info items on indebtedness. One of the key measures is the measurement of the state's fiscal condition according to Generally Accepted Accounting Principles (GAAP), something that the Walker Administration originally pointed to as a fiscal failure of Jim Doyle's tenure as governor, using 2010 deficit fears to try to make the state's budget situation look awful. Let me go back to a Wisconsin Politi-"fact" article that had to admit that Walker was lying when he said
...Walker made an explicit promise, on his campaign website: To "require the use of generally accepted accounting principles (GAAP) to balance every state budget, just as we require every local government and school district to do."...

The state budget, under the Wisconsin constitution, must be balanced. But the cash accounting method the state uses allows gimmicks to bring the budget into balance. For instance, the state has in years past shifted payments to local governments into the next fiscal year in order to make the budget appear balanced in the present, said Robert Lang, director of the non-partisan Wisconsin Fiscal Bureau.

Walker balanced the budget, and in a way that eliminated the state's structural deficit, under the manner the state has long used.

But GAAP, an accrual accounting method, is a tighter standard that counts future liabilities that flow from past budget actions.
To Walker's and WisGOP's "credit," the GAAP deficit had decreased in the first 3 years of their time in power, as the economy improved nationwide and Act 10 transferred payments for state workers' benefits from the general taxpayer to the workers themselves (we'll leave out the damage that caused to the economy and the state's morale for the time being). But that trend of declining GAAP deficits ended in Fiscal Year 2014-15. As the CAFR notes
The General Fund is the chief operating fund of the State. At June 30, 2015, the State's General Fund reported a total fund deficit of $(1.8) billion. The net change in fund balance during Fiscal Year 2015 was $(413.7) million, in contrast to $370.8 million in Fiscal Year 2014.
This means the GAAP deficit was nearly $43 million higher when the 2013-15 budget ended vs when it began on July 1, 2013 (going against a claim made by the Walker Administration in the Politi-"fact" article).

To go further, the CAFR says the main reason for the increased GAAP deficit in Fiscal Year 2015 was due to higher expenditures, including a $406 million unfunded giveaway to tech colleges as a method of cutting property taxes, and over $478 million in increased Medicaid expenditures that were the result of Gov Walker and the WisGOP Legislature "reforming" the program without taking the 100%-federally funded Medicaid expansion that was in Obamacare. And that GAAP deficit is poised to go even higher in Fiscal Year 2015-16, as an increase in per-pupil aids for K-12 education is being delayed until after July 1 (which drives up the GAAP deficit) and $175 million is being borrowed from the General Fund to pay for road projects in the next Fiscal Year.

In addition, page 34 of the CAFR shows that the state's overall indebtedness for General Obligations went up by nearly $190 million, to just under $7.45 billion. This reflects a skipped debt payment of $108 million in May to avoid a budget repair bill, and other maneuvers throughout the year by the Walker Administration. Other debt actually went down by around $185 million, but with $675 million in Transportation Fund debt slated to happen in the next 2 years, it seems likely that number goes up in future years as well.

These GAAP numbers and increased indebtedness make it all the more remarkable that a State Senate Committee decided to pass a proposed amendment to the state constitution this week that would do the following.
This constitutional amendment, proposed to the 2015 legislature on first consideration, requires the state to account for and report all funds it receives or expends in accordance with generally accepted accounting principles (GAAP).

The amendment further authorizes the legislature to establish the budgetary basis of accounting, requires that any deficit of a state fund affected by a budget bill be reduced annually by 10 percent of any projected increase in tax revenues in that fund, and requires that, once the deficit is eliminated, the legislature may not pass any bill that would result in a projected deficit.
In other words, as the GAAP deficit rises, this amendment would force the accounting measures to change, resulting in a massive hole that would have to be filled in the state budget in 2019-21 (the earliest the amendment could come into law). It's the equivalent of forcing you to pay all of your mortgage, car loan, and student loans all at once to get your net worth to $0, instead of staying on the payment plan. Needless to say, this would jack up most people's finances, and this would especially be true in the case of the State of Wisconsin. And by total coincidence, that would be at the start of the next term of governor- a governor that seems likely to be a Democrat the way the Walker Administration is going these days.

Jon Peacock of the Wisconsin Council of Children and Families (and the authors of the indispensable Wisconsin Budget Project blog) testified against this bill in a public hearing last month, and included the following note.
Putting a GAAP accounting requirement into the constitution would tie the hands of WI lawmakers and would give authority for setting the parameters of state budget options to a private national organization.
True, but then take a look at the two organizations that have lobbied in favor of this sham budget bill, and realize that this may be the intelligence of the bill's design. It's the Koch Brothers' "Americans for Prosperity" and Wisconsin Manufacturers and Commerce! How cute is that! Two oligarch groups who elected the GOP politicians who signed onto the tax cuts and reckless borrowing that led to the increase in the GAAP deficit, and now want to force major budget cuts by balancing the budget using GAAP! No doubt this is part of a long-term strategy to cause privatization and profitization of state assets that will no doubt go to WMC and Koch/AFP backers. Disgusting, but that's how the way these right-wing oligarchs roll, tying to install the Shock Doctrine as much as they can.

With this bill in mind, anyone else find it more than a bit suspicious that the Walker Administration released the CAFR a week later than normal, so the reality of more than $400 million in additional GAAP deficit wasn't out there as the bill was voted on (it passed 3-2, all GOPs voting "yes", Dems voting "no")? We know there are few if any coincidences with this crew, but we need to stay on this proposed constitutional amendment as it tries to make its way through, because it is anything but fiscally responsible, and would cause even more damage to a state that is near FUBAR'ed as it is. Which may be how ALEC and the Kochs and WMC like it, but for those of us outside of the right-wing Bubble, it would be horrible and disastrous.

John Doe goes to DC

Hi there oligarchs and Koch suckers! Game on.

Thankfully, DAs Chisholm, Ozanne, and Nelson had the decency not to allow the scumbags to win without a fight. Now let's see if SCOTUS wants to legalize money-laundering and tax evasion, and completely contradict what they stated in Citizens United, where they promoted disclosure, and spoke against coordination, as they claimed superPACs should be "independent."

And given that we have conflicting decisions on these same issues in courts that aren't owned by the Kochs and other RW oligarchs, let's see where this goes.

Thursday, December 17, 2015

Two more bad jobs reports for Wisconsin today

You knew the Walker Administration was scared about other jobs numbers that might hit the news today when they sent out the November Wisconsin jobs numbers around 9am this morning, instead of waiting for their typical release time around noon. And look at that crap they chose to emphasize in the report.
Place of residence data: A preliminary seasonally adjusted unemployment rate of 4.2 percent in November 2015, its lowest point since March 2001, down from 4.3 percent in October 2015 (technically, down from 4.26% to 4.247%, but who's counting?). The 4.2 percent rate is below the national unemployment rate of 5.0 percent for the month and below the state's rate of 5.2 percent in November 2014. Additionally, the state's labor force participation rate of 67.8 percent in November outpaced the national rate of 62.5 percent by 5.3 percentage points.

Place of work data: Wisconsin added a statistically significant 33,400 private sector jobs and 29,900 total non-farm jobs from November 2014 to November 2015 (seasonally adjusted). Private sector job numbers for the month of October were revised up 1,500 to 16,600, marking October 2015 as the best month of net job growth dating back to April of 1992 and the best October since 1990. While the preliminary numbers show a loss of 3,800 private sector jobs from October 2015 to November 2015, it is not considered significant and is well within the margin of error.
Like how they snuck that in at the end? I'll repeat it for you if you stopped reading. WE LOST 3,800 PRIVATE SECTOR JOBS IN NOVEMBER, which kind of seems important given that it was the NOVEMBER jobs report that was being released. And I like how the November number is given a caveat by the "best month of net job growth dating back to April of 1992" doesn't get the same treatment. Gee, wonder why that is...

And it wasn't just the 3,800 private sector jobs we lost. That same BLS report also says we lost 4,800 jobs overall in November, and that October's total jobs number was revised down by 5,200. Which means that we are down 10,000 total jobs from where we thought we were yesterday. In the U.S. jobs report for November, the October figure was revised UP by 27,000, and November jobs jumped by 211,000. So this blows the Walker jobs gap in Wisconsin much higher, by 14,000 total jobs compared to what we had in last month's report, and another 6,500 or so in the private sector. This now puts the total Walker jobs gap at over 99,000 private sector jobs and over 95,000 jobs overall.

Here's the scary part- this wasn't even the worst jobs report involving Wisconsin that was released today. That goes to the Quarterly Census on Employment and Wages, which came out today and covered the June 2014-June 2015 time period. And as was foretold last month, the state doesn't look good when comparing our tepid job growth to the rest of the country, or even our Midwest neighbors.

Change in private sector jobs, June 2014-June 2015
U.S. +2.3%
Ind. +1.93%
Mich +1.85%
Minn +1.8%
Ill. +1.7%
Ohio +1.6%
Wis. +1.3%
Iowa +1.1%

That 1.3% figure placed Wisconsin 37th out of the 50 states for private sector job growth (our 1.0% total job growth was also "good" for 37th). Even worse, usually Walker-lenient John Schmid and Craig Gilbert weren't so nice in today's Journal-Sentinel when it came to discussing the state's standing during the Age of Fitzwalkerstan. Check out this part.
Wisconsin ranked 32nd in private-sector job growth among the 50 states in the five-year period that ended in June, new government figures show — a period that effectively encompasses the national hiring recovery since the last recession.

The Badger State increased private-sector jobs by 7.6% during the five-year turnaround, lagging behind the national rate of 11.2%. Wisconsin's ranking of 32nd also placed it behind nearby states in the Midwest: Michigan's job growth during the same stretch ranked 10th, Indiana 18th, Minnesota 20th, Ohio 24th, Iowa 30th and Illinois 31st.
And for those of you who are visually-inclined, here's the Journal-Sentinel's full list since June 2010.

So Wisconsin wasn't just falling further behind the curve in November- we were already way down before the last few months, largely due to the austerity, low-wage policies of the Walker/ WisGOP crew. Oh, and now property taxes are on their way up, and more budget cuts loom over the next 18 months due to the deficit-wracked state budget. Does anyone that's not on the Walker/Koch payroll truly believe this trickle-up BS is working for anyone else?

Wednesday, December 16, 2015

2 more hits to the Wisconsin we once knew

Now we have two more reasons this state feels like it's in decline. The first happened after I flipped off Big Ten Network last night after watching UW hoops plug its way to a non-conference win. I woke up, and found out that Bucky now has a new men's basketball coach, after Bo Ryan quit following the game, handing over the job to longtime top assistant Greg Gard.

Obviously, the suddenness of Bo's retirement is a bit shocking, but the resignation itself isn't- Bo had indicated he was going to step down at the end of the year, and doing so in the season makes it more likely Gard has a chance to keep the Badger hoops job for 2016-'17 and beyond. The tributes from Bo's former players and other associates are pouring in, including arguably the best player Bo has ever coached- last year's college Player of the Year, Frank Kaminsky. Frank the Tank wrote a column this afternoon in the Victory Lap Blog with his thoughts on Bo's retirement, and the lessons Coach Ryan taught. Kaminsky says he was often frustrated with his lack of playing time his first two years in Madison, but said it drove him to work harder, and now realizes the intelligence of Ryan's designs for him.
Looking back on it, I know now that Coach Ryan knew what I was capable of becoming. I see so many different instances now that were signals of him understanding what he had in me. One time in particular was during a summer practice before my junior year. He pulled me aside and asked, “You wouldn’t leave this school early, would you?” I didn’t think anything of it at the time, and I’m not sure if he would even recall that, but it stuck out to me because I hadn’t even played a truly meaningful minute of basketball for Wisconsin at that point. I said I wouldn’t, and I meant it when I had the opportunity to leave Wisconsin a year early. It was even more evident when he told me after my junior year that if I stayed and worked hard that summer our team would take the program to a whole different level, and that I would be in consideration for National Player of the Year. He was right again.

The most important thing that Bo ever passed on to me were the lessons I learned through the game of basketball. He taught me how to work with and rely on other people when things weren’t going my way. He taught me the concept of moving on and not letting one bad thing spiral into many bad things. He taught me what it takes to achieve what I want. He taught me to be great at all the things that don’t take any skill. The fire and passion that everyone saw on the sidelines during the games was permanent in his personality. It was evident in every practice, shoot around, film session, and scouting report. He passed that approach to basketball on to me and countless other players.

Without Bo taking a chance on that tall white kid from suburban Illinois, I wouldn’t have been given the opportunity to attend the best University in the country. I wouldn’t have met some of my best friends. I wouldn’t have gone to back-to-back Final Fours. The whole complexion of my life would be completely different. I can’t imagine taking an alternate path to get to where I am right now. If not for Coach Ryan, I don’t know where I would be, but I can assure you this: It would not be any better. He took in an immature kid that very few people wanted, and in nothing short of a modern miracle, turned him into a man ready to face the future. It is impossible to count the number of people who have a story to tell about Coach Ryan. I’m only capable of telling my own, but right now I’m sure I speak for everyone. Thank you, Bo.
(quick sidelight, I notice that Frank has frequently referenced being white. Almost like he feels people overlooked him due to his skin color, and it drove him to kick people's ass even more).

Notice that Bo was consistently tough, accountable, and ethical throughout his 40 years of coaching at the college level. That seems important to bring up in light of the other damaging event to the state that happened today.
Gov. Scott Walker has cemented key changes in time for the 2016 political campaign, signing into law bills giving campaign finance law its biggest makeover in decades and dismantling and replacing Wisconsin's oversight board for elections and elected officials.

Walker's signature of the two bills, announced in a press release, was conducted in private Wednesday. It was widely expected after the bills passed the Legislature last month on votes that largely mirrored party lines.

The campaign finance measure dials back restrictions on money flowing into state political campaigns, some of which had been struck down by court rulings.
In other words, it slants the playing field of elections toward the rich and well-connected, while hiding politicians from independent accountability, and their donors from having the public find out about the influence they are attempting to buy.

The method of Scott Walker's standard operating procedure couldn't be more different than the way Bo Ryan handled things as the guy in charge. Instead of doing things the right way, like Bo has done, Walker has a lot more of John Calipari-style crookedness and duplicity. Except unlike Calipari, Walker doesn't even make things better off for the program he is heading- Wisconsin's economy has consistently lagged the rest of the country, and the quality of life has declined. Which makes Walker a lot more like flailing Indiana coach Tom Crean, not acheiving anything close to the lasting greatness that Bo has, and unlike what Bo did for the UW basketball program, Walker will not leave the state in a better place than when he got here.

Tuesday, December 15, 2015

WMC poll will be ignored by WMC's greedheads

As part of Wisconsin Manufacturers and Commerce’s recent “Future Wisconsin” economic summit event, WMC released the results of a poll it got the Wisconsin Technology Council and UW-Madison to do for it. This poll consisted of over 2,000 people from inside and outside the state, and asked the respondents what they thought about Wisconsin and its economy.

A WMC official said that the state was having problems attracting talent, but had some good things to offer those who would come here.
Given that most people decide to move from one place to another (migration/immigration) in search of economic opportunity and they rate Wisconsin low as a place to find that opportunity, then the state has a big problem," says Jim Morgan, president of the WMC Foundation, the research arm of the State Chamber of Commerce. "Wisconsin is actually well-positioned with a diverse economy and jobs available in all industries, but out-of-staters don't know that." ….

On the bright side, survey respondents rated Wisconsin positively in education, crime/public safety, cost of living and commute times when asked where Wisconsin ranks as a place to live.

"There are positives to build on," said Morgan. "We rate highly in important areas like quality of life and cost of living. We are also known for good schools and natural beauty. But, we don't just want to be a place to visit on vacation. We want people to know that Wisconsin is a great place to live, work and to raise your family.

The slides WMC handed out in relation to this poll’s results went into more detail, and it seems very telling what people with real jobs and lives are saying about Wisconsin outside of the oligarchical Bubble of WMC and WisGOP World.

WI is a Leader in...
•Parks and Recreation/Natural Resources
•Quality of Life
•Sense of Community

The problem is that the WMC-supported Scott Walker regime has worked hard to diminish all 3 of these leadership qualities in the nearly 5 years they have been in charge here. Whether it’s through weakening environmental protections and increasing fees to enjoy state parks, to a “divide and conquer” mentality and defunding of education that has broken this state’s sense of community, this Administration has removed the advantages that the respondents to the WMC poll said the state had.

On the other side, check out what the poll respondents said was hurting Wisconsin’s economy and way of life these days.
Negative Perceptions
All Responses
•Job opportunities (52%)
•Climate (48%)
•Social Tolerance/Diversity (46%)
•Wage Expectations (46%)

So why are WMC and their GOP lackeys at the Capitol continually promoting policies that double down on these negative perceptions? This crew has promoted a low-wage, low-skill economy for workers in Wisconsin, discouraged entrepreneurship and innovation, and the WisGOPs have backed a slew of socially regressive bills. And while weather and climate isn’t something one can change too much short-term, WMC is certainly trying to warm things up, as they’ve gotten lapdog AG Brad Schimel to file lawsuit after lawsuit against President Obama and the Environmental Protection Agency’s tougher rules against greenhouse gas emissions.

(Interestingly, Schimel hasn’t lifted a finger to go after the corporate slush fund known as WEDC, whose rent-seeking and waste of taxpayer resources seems to be limiting whatever growth we can get in the Age of Fitzwalkerstan. Funny that).

And notice this answer in the WMC poll from where Wisconsinites would move to.
Where would you relocate?
All states with Democratic governors, all with a high emphasis on natural beauty and quality of life. You don't see those places propped up by the WMCs of the world for their tax structure, nor do those states bank on “business-friendly” deregulation. But yet, those are the places seen as having economic opportunities and a life worth leaving Wisconsin for. That doesn’t happen in a vacuum, folks.

My guess is that WMC will give a lot of lip service in the coming months about “trying to attract talent,” because they know that people outside of the Bubble aren’t buying the low-tax, low-cost, trickle-down model these days. But then as the elections approach, these “job creators” will go back to being the regressive greedheads that they have always been, throwing money at politicians and judges who will try to keep us going in the same, downward direction that we’ve been going since the Republicans took power in this state in 2010.

So if WMC is going to ignore their own data in favor sticking with their selfish ideology, why should anyone who cares about results listen to what they say?

Monday, December 14, 2015

Overdue release of revenues still isn't enough data. Sorry

In keeping with the theme of the Walker Administration not being forthcoming on where this state stands economically, check out this from the Wisconsin Budget Project site, where they not only compare the fiscal rules between Wisconsin and Minnesota, but also the fact that Minnesota gets much more data out, and is consistent in when they release of that data.
·Unlike Wisconsin, Minnesota releases data on revenue collections on a regular monthly schedule, and each statement compares the actual revenue collected with the projected amount (which would be extremely useful for budget analysts in Wisconsin).

· Minnesota releases a comprehensive budget and economic forecast twice a year, as well as quarterly updates on revenue and economic projections. Wisconsin used to issue economic forecasts quarterly, but they are now released just once or twice a year, and budget updates are also infrequent.

· In contrast to Wisconsin, Minnesota’s budget projections look four years ahead (currently through FY 2019) and include estimates of future revenue and spending growth.

· Minnesota regularly transfers money from projected surpluses into its rainy day fund, which at $1.6 billion will soon be more than five times the size of Wisconsin’s rainy day fund ($280 million).
Fortunately, one of the missing pieces of that data was revealed this monring, as the Wisconsin Department of Revenue finally released October’s figures for the General Fund. And given what the numbers were, I’m wondering why there was such a delay. Yes, income tax revenues are a little odd because Halloween fell on a Saturday instead of a Friday, which means the numbers are adjusted upward to reflect any income taxes that were received in November but actually were withheld in October (November’s figures will likewise be adjusted down to “normal” as a result). But the numbers were quite strong, particularly for income and excise taxes.

Oct 2015 Gen Fund revenues vs Oct 2014, Wisconsin
Adjusted overall revenues up 6.1%
Income taxes UP 9.35%
Sales taxes UP 1.8%
Corporate taxes UP 9.5%
Excise taxes UP 3.6%

That looks pretty good, other than the sales tax figures (especially since the falling price of gasoline is not subject to sales tax in Wisconsin, so you’d think other sales and their taxes would be going up). But this nice bump in October still leaves us a bit below where we need to be to reach projections for the 2015-16 fiscal year, with the notable exception of excise taxes (insert your own joke why).

FY 2016- revenues to date vs projected increase in budget
Income taxes +6.7% vs 7.1% projected
Sales taxes +1.6% vs. +3.3%
Corporate taxes -4.3% vs -1.1%
Excise taxes +1.1% vs -2.8%
Overall tax revenues +4.0% vs. +4.6%

Of course, this is only 1/3 of the way through the fiscal year, so there is plenty of time to catch up, and given that the approved budget had a projected year-end balance of $161.8 million, and had an extra $135.6 million to play with on top of that (a number which was A BALANCE AND NOT A SURPLUS), there’s no real need to panic about the current state budget (more than you already should have been, anyway).

That being said, November and December are when the major layoffs of late 2015 were announced and/or started to hit, and perhaps that effect will start to be seen on revenues like it has with recent unemployment claims. But for now, I’d put the state’s fiscal picture as “cautiously OK,” for FY 2016 for the time being, with the right to lean pessimistically once/if we actually get updated data from the state.