Wednesday, August 10, 2011

Well, that's a relief!

After the unions and Democratic interest groups poured everything they could into Wisconsin, they weren't able to win the three seats that they needed to take back the Wisconsin state senate. They spent over $35 million, mostly from out of state, into advertising and get-out-the-vote efforts. Think of that amount of money being spent in only six state senate races. And they pulled out all the rhetorical stops even having Al Sharpton declare it a defining moment. Although it didn't help Sharpton's new MSNBC show that he suffered an embarrassing teleprompter failure while covering the recalls.

In the end, one Republican in a majority Democratic district and another who had been dogged by rumors of cheating on his wife with a staffer were recalled, but a third Republican targeted in a Milwaukee suburb, Alberta Darling. The Democrat was leading for most of the evening, but in the end Darling won by more than 7 points. Darling had been the real target of the Democratic recall efforts. They spent over $8 million into the district to unseat Darling, who had
been co-chair of the state senate's budget-writing committee. The Democratic state-party chairman called her race "the crown jewel" of the recall effort. And she won handily.

Perhaps this information that the Milwaukee Journal Sentinel waited until the last day to publish in a grudging editorial helped to sway voters.
So it turns out that the sky isn't going to fall on all local governments in Wisconsin. The numbers now starting to come in show that Gov. Scott Walker's "tools" for local governments apparently will help at least some of them deal with cuts in state aid imposed by the state budget.

That's contrary to the expectation and the rhetoric of critics in the spring, and it's to Walker's credit. It bears out the governor's assessment of his budget-repair bill, although we still maintain he could have reached his goals without dealing a body blow to public employee unions.
Just as Walker promised, his budget that the Republicans pushed through helped save the money that it needed to in order for local districts to balance their budgets.
But the news is good for many. The latest example is Milwaukee, where the most recent estimates show the city with a net gain of at least $11 million for its 2012 budget. That will take a slice out of the city's structural deficit, which is created by costs rising faster than revenue, and will reduce cuts that Mayor Tom Barrett and the Common Council must impose.

The city projects it will save at least $25 million a year - the figure could be as high as $36 million in 2012 - from health care benefit and pension changes it didn't have to negotiate with unions because of the changes wrought by the new law that ended most collective bargaining for most public employees.

That certainly will help the city deal with the $14 million in cuts in state aid in the 2011-'13 state budget.
In fact, it is only the school districts that rushed through collective bargaining agreements before the GOP-backed bill went into effect that had to lay off teachers. In those districts, the union exercised its veto power to choose layoffs rather than contributions to their pensions.
In Milwaukee, nine schools are shutting and 354 teachers have been fired due to a drop in state funding and the end of federal stimulus funding. But if teachers there agreed to the 5.8 percent pension contribution, the school district says it would rehire 200 of those teachers. (Other changes could offset the rest of the layoffs.)

Despite the promise from Mary Bell that all teachers would contribute something toward their pensions, Milwaukee teachers’ union president Bob Peterson won’t agree to the change. In doing so he’s made it clear that “collective bargaining rights” is code for “union veto power.”

“You have a choice: layoffs or pension contributions. Do you see that choice?” a local Fox News reporter asked Peterson. “Why did you make a choice of layoffs?”

“I didn’t lay off anybody,” Peterson replied. He thinks Milwaukee teachers have conceded enough and blames Walker’s budget cuts for the layoffs. But a year ago​—​before Walker was elected and when Democrats controlled all branches of government​—​there were also layoffs.

Given the choice between fewer benefits and layoffs, the Milwaukee teachers’ union chose the latter. In 2010, 482 teachers, including Megan Sampson, a young educator named an “outstanding first year teacher” by the Wisconsin Council of Teachers of English, got the axe. CNN reports that this year “Milwaukee teachers are offering meals and moral support to 354 fellow educators who will be laid off.” Meals and moral support? The union’s got your back. A job? Not so much.

The only other district seeing such massive layoffs is Kenosha, where 212 teachers will be fired this year. “Kenosha is in the same boat as [Milwaukee], with a collective bargaining agreement signed before Walker took office that lasts until June 30, 2013,” the Milwaukee Journal Sentinel reported on July 16. “But most other Wisconsin districts have avoided layoffs and massive cuts to programs.”
The bill has performed exactly as promised giving school districts the flexibility and the added money saved from teachers having to contribute to their own pensions to balance their budgets without laying off teachers.
With “collective bargaining rights” limited to wages, Koczela was able to change the teachers’ benefits package to fill the budget gap. Requiring teachers to contribute 5.8 percent of their salary toward pensions saved $600,000. Changes to their health care plan​—​such as a $10 office visit co-pay (up from nothing)​—​saved $200,000. Upping the workload from five classes, a study hall, and two prep periods to six classes and two prep periods saved another $200,000. The budget was balanced.

“Everything we changed didn’t touch the children,” Koczela said. Under a collective bargaining agreement, she continued, “We could never have negotiated that​—​never ever.” Koczela, a graduate of Smith College and Duke University Law School, is no Republican flack. She says she’s a “classic Wisconsin independent. I vote both parties. I voted for Senator [Russ] Feingold but I voted for [Republican state] Senator Alberta Darling too.”

n Brown Deer and school districts across the state, Walker’s budget repair bill, known as Act 10, is working just as he promised. To make up for a $2.8 billion deficit without raising taxes, state aid to school districts (the largest budget line) was reduced by $830 million. Act 10, Walker said, would give districts “the tools” needed to make up for the lost money as fairly as possible.
This is a huge repudiation of the union-fueled lies about what the reforms instituted by the Republicans would accomplish. They tried everything they could in the state supreme court race against David Proctor earlier this year and yesterday. They were hoping that Wisconsin would provide a spring board to victories against Republicans across the country. They threw in everything they could and the voters didn't buy it. They outspent the GOP two-to-one, but they're reduced to claiming that just getting the signatures to force the recall elections was a victory in the first place.

The unions and Democrats will work hard to try to recall Governor Walker next year and Russ Feingold might throw his hat into the ring in that fight. The fight isn't over. But there will be even more evidence by then that his reforms are working. He was able to balance Wisconsin's budget without raising taxes. And it doesn't hurt that Wisconsin added 9,500 jobs in June, more than half of all the jobs created across the country. As voters get to see that the Democratic demagogues were misleading them about the effects of the GOP reforms, it is going to be harder to keep their lies going.

In this national environment of people yearning for politicians willing to risk their political careers to find solutions to address our financial liabilities, the Wisconsin Republicans stepped up. And they survived everything that the unions had to bring them down and scraped by. This will give encouragement to similar reform efforts in Michigan and Ohio. We're seeing natural experiments in federalism and the Midwest is providing the laboratory. In Illinois they're raising taxes and losing businesses. In Wisconsin they're balancing their budgets and seeing increased job growth. Some choice.