Wisconsin State Employees & Budget Cuts

[Phatscotty]

There's also the business tax cuts and further cuts for new companies. The idea that so many companies will be flocking to Wisconsin that they will make up for the deep cuts in revenue is defying the Laffer curve. Crunch all the numbers you want, but history and economics are not on your side here.

Bush's chief economist said it well. "You are smart people. You know that the tax cuts have not fueled record revenues. You know what it takes to establish causality. You know that the first order effect of cutting taxes is to lower tax revenues. We all agree that the ultimate reduction in tax revenues can be less than this first order effect, because lower tax rates encourage greater economic activity and thus expand the tax base. No thoughtful person believes that this possible offset more than compensated for the first effect for these tax cuts. Not a single one."

Then there's the reduction of salaries elsewhere. It's entirely speculative of you to assume the salaries will be the same in Wisconsin, for one. If anything, they'd be far less because of the weakening of the unions through the move to become a right-to-work state. So less salaries means less in income tax and sales tax collected.

Moves like these are almost purely politically motivated.

So Scotty, Wisconsin is not living within its means. Where should they cut spending now?

The tea party doesn't seem to get that when they object to "government" they are just handing the keys to their house over to the wealthy, the largest companies.

If you want to see who currently has power in this country, just try to go up against Walmart.

Interesting opinion. Just curious, how does the reality that the Tea Party made sure many politicians who were just pawns of the wealthiest corporations (mainly republicans) did not even qualify in their primaries to run for re-election??

[Phatscotty]

... Portion of a letter sent to GOP reps in Wisconsin:

"We feel that you and the people that support the dictator have to die. If you and your goonies feel that it's necessary to strip the rights of 300,000 people and ruin their lives, making them unable to feed, clothe, and provide the necessities to their families and themselves then We Will 'get rid of' (in which I mean kill) you."

... Classy, eh?

See what lies do...

I'm wondering if that's not a lie in itself. I'm not at all accusing Nobunaga of lying (he's always struck me as being very upfront)...rather, where his information may be coming from.

I've seen that death threat. The DOJ and FBI and some other agency have already verified who sent the letter and charges have been filed on at least 2 people. Do you have any reason to believe this death threat is a lie, or just hoping? I've seen hundreds of interviews over the last 2 weeks and even met a few in person, people who are very angry, violent in their rhetoric, holding up Walker is Hitler signs.

Honestly, I would be surprised, after all this, if there weren't any death threats from the protesters. The politicians have had to cancel parades and family events because of these death threats.

Where my comment comes in "See what lies do" is that when people think their "rights" are being taken away, well then that enters into a whole new area where "fighting for your rights" becomes literal, even to the death.

[Phatscotty]

There's also the business tax cuts and further cuts for new companies. The idea that so many companies will be flocking to Wisconsin that they will make up for the deep cuts in revenue is defying the Laffer curve. Crunch all the numbers you want, but history and economics are not on your side here.

Pwn, the business tax cut will cost gov't is 110 million dollars. I have shown, in detail, how easy it is to make that money back. I fully believe what he is doing here is a good thing for WI. I feel this strongly because I have predicted in the past and am seeing firsthand in the present that Walkers tax cuts are bad for Minnesota, my state. this is from a competitive point of view.

I guarantee you, any business owner who drives to Wisconsin and sees the huge "Open for Business!" (where it used to have the previous gov's name) sign has wondered to themselves about the possibilities for their company, some of those have even made phone calls to WI chamber of commerce and the like, and some of those liked what they heard and are exploring options further. This isn't speculation as companies are already leaving Minnesota to WI. We are also under attack, competitively and economically, from Iowa, North and South Dakota, and I guarantee you also that a lot of business will come from Illinois.

[Night Strike]

... Portion of a letter sent to GOP reps in Wisconsin:

"We feel that you and the people that support the dictator have to die. If you and your goonies feel that it's necessary to strip the rights of 300,000 people and ruin their lives, making them unable to feed, clothe, and provide the necessities to their families and themselves then We Will 'get rid of' (in which I mean kill) you."

... Classy, eh?

See what lies do...

I'm wondering if that's not a lie in itself. I'm not at all accusing Nobunaga of lying (he's always struck me as being very upfront)...rather, where his information may be coming from.

From the same letter I posted in the Union Death Squads thread.

[Woodruff]

... Portion of a letter sent to GOP reps in Wisconsin:

"We feel that you and the people that support the dictator have to die. If you and your goonies feel that it's necessary to strip the rights of 300,000 people and ruin their lives, making them unable to feed, clothe, and provide the necessities to their families and themselves then We Will 'get rid of' (in which I mean kill) you."

... Classy, eh?

See what lies do...

I'm wondering if that's not a lie in itself. I'm not at all accusing Nobunaga of lying (he's always struck me as being very upfront)...rather, where his information may be coming from.

I've seen that death threat. The DOJ and FBI and some other agency have already verified who sent the letter and charges have been filed on at least 2 people. Do you have any reason to believe this death threat is a lie, or just hoping?

Yes, I do. This is the first I remember hearing of it. And I have learned to be very skeptical of most of the claims people make about things they've found on the Internet.

I've seen hundreds of interviews over the last 2 weeks and even met a few in person, people who are very angry, violent in their rhetoric, holding up Walker is Hitler signs.
Honestly, I would be surprised, after all this, if there weren't any death threats from the protesters. The politicians have had to cancel parades and family events because of these death threats.
Where my comment comes in "See what lies do" is that when people think their "rights" are being taken away, well then that enters into a whole new area where "fighting for your rights" becomes literal, even to the death.

But you only give a shit when it's rights that you agree with.

[Phatscotty]

... Portion of a letter sent to GOP reps in Wisconsin:

"We feel that you and the people that support the dictator have to die. If you and your goonies feel that it's necessary to strip the rights of 300,000 people and ruin their lives, making them unable to feed, clothe, and provide the necessities to their families and themselves then We Will 'get rid of' (in which I mean kill) you."

... Classy, eh?

See what lies do...

I'm wondering if that's not a lie in itself. I'm not at all accusing Nobunaga of lying (he's always struck me as being very upfront)...rather, where his information may be coming from.

I've seen that death threat. The DOJ and FBI and some other agency have already verified who sent the letter and charges have been filed on at least 2 people. Do you have any reason to believe this death threat is a lie, or just hoping?

Yes, I do. This is the first I remember hearing of it. And I have learned to be very skeptical of most of the claims people make about things they've found on the Internet.

I've seen hundreds of interviews over the last 2 weeks and even met a few in person, people who are very angry, violent in their rhetoric, holding up Walker is Hitler signs.
Honestly, I would be surprised, after all this, if there weren't any death threats from the protesters. The politicians have had to cancel parades and family events because of these death threats.
Where my comment comes in "See what lies do" is that when people think their "rights" are being taken away, well then that enters into a whole new area where "fighting for your rights" becomes literal, even to the death.

But you only give a shit when it's rights that you agree with.

Actually, I wouldn't even call those "rights". What, only 3% of the US workforce get these "rights"? Those are special privileges, and totally open for debate in the case of tax-payer supported unions.

[Nobunaga]

... Two links to it below.

http://lakelandtimes.com/main.asp?Secti ... M=49149.66

http://tpmdc.talkingpointsmemo.com/2011 ... gopers.php

[HapSmo19]

Check this out: http://michellemalkin.com/2011/02/17/wa ... ou-to-see/

[GreecePwns]

There's also the business tax cuts and further cuts for new companies. The idea that so many companies will be flocking to Wisconsin that they will make up for the deep cuts in revenue is defying the Laffer curve. Crunch all the numbers you want, but history and economics are not on your side here.

Pwn, the business tax cut will cost gov't is 110 million dollars. I have shown, in detail, how easy it is to make that money back. I fully believe what he is doing here is a good thing for WI. I feel this strongly because I have predicted in the past and am seeing firsthand in the present that Walkers tax cuts are bad for Minnesota, my state. this is from a competitive point of view.

I guarantee you, any business owner who drives to Wisconsin and sees the huge "Open for Business!" (where it used to have the previous gov's name) sign has wondered to themselves about the possibilities for their company, some of those have even made phone calls to WI chamber of commerce and the like, and some of those liked what they heard and are exploring options further. This isn't speculation as companies are already leaving Minnesota to WI. We are also under attack, competitively and economically, from Iowa, North and South Dakota, and I guarantee you also that a lot of business will come from Illinois.

Okay then, I'll crunch the numbers, and tell me how many companies of 700-900 people (not exactly 900, we'll assume 800 for fairness) will need to relocate to Wisconsin to make up that 100 million dollars.

Hutchinson has been recording net losses since at least 2008.

Net sales for 2010 were $344.8 million. Sales taxes on these at 5 percent would be around $17 million.

The median salary in Wisconsin is $45,000. So with a new median set to just under $40,000 the state collects around $2.2 million in income taxes from these 800 workers.

This is mitigated by the tax cuts, which allow a company such as this a $2,000 deduction for each job they create, or in this case, a loss of $1.6 million. Each job created by this company will get around $700 to the state.

Can I ask where the 110 million dollar number is coming from? Sorry if I missed it. If this is correct, it will take roughly 7 Hutchinson-like companies moving to WI under these conditions. Not easy whatsoever. Especially when for business making sales under $5 million dollars (in this case, the bulk of new businesses in WI), the sales break is $4,000 for each job they create. Thats more than what the median income would pay in income taxes. The more businesses which make sales of less than $5 million move there to create jobs, the more tax revenue decreases. All the Hutchinsons of the world won't be able to make up for that.

[thegreekdog]

So, greecepwns, I just want to be clear on your stance here. You're saying that tax cuts for businesses that bring jobs to Wisconsin is not worth removing the collective bargaining rights for unionized state employees?

[GreecePwns]

So, greecepwns, I just want to be clear on your stance here. You're saying that tax cuts for businesses that bring jobs to Wisconsin is not worth removing the collective bargaining rights for unionized state employees?

Assuming the 110 million dollars is an estimate in the losses of the state from the tax breaks, no. There is little to no probably of getting that back unless the state attracts a miraculous amount of big businesses to make up for the inevitable losses that come from the creation of jobs by companies with sales less than $5 million (the break is $4,000 a job, while a $45,000 job which is above the median would pay $3,150 in income tax).

While removing the collective bargaining rights will save money in the long run, it was unnecessary. Walker was not willing to compromise, while the unions were. Had Walker written up something in which the unions had to make the financial concessions they had promised to make without making them give up their bargaining rights and the unions would not accept it, I would be more sympathetic to him on the issue. But that simply didn't happen, so he has no right to complain that the unions would not concede.

Both moves are simply, mindnumbingly counterproductive.

My rough estimation means the losses from this tax break will be many times greater than the money saved from. Contrary to Walker and Republican politicians, just because the Laffer curve exists doesn't mean we are always on the downward sloping side of it at all times.

[pimpdave]

Wasn't there a thread recently showing that corporate tax rates don't effect job growth? So the idea of cutting corporate tax rates to attract jobs isn't based in reality.

[thegreekdog]

Wasn't there a thread recently showing that corporate tax rates don't effect job growth? So the idea of cutting corporate tax rates to attract jobs isn't based in reality.

They didn't actually cut taxes. They provided credits and incentives for businesses that create jobs. So, it's not business tax cuts in the strict sense of the term (like cutting the tax rate). In order to take advantage of the tax advantages, a business actually has to create more Wisconsin jobs. So, in order to get the $2,500 per person (I think that's what it is), the job has to be created first. That's why I was keen on getting someone to post the tax bill instead of throwing out the words "tax cuts for businesses."

Greecepwns - typically with tax credits there is a limit to the amount of credits the state will grant. I'm not sure what Wisconsin's limit is. With tax incentives (i.e. where the state gives you money), there is also a limited pool of money. And if the money is not used up, it goes back into the state's general fund (at least that's how it works in Pennsylvania with the film credits and the R&D credits that go unused).

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

[PLAYER57832]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

[thegreekdog]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut. They are also permitted to collectively bargain for salary purposes, just not anything else.

[PLAYER57832]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut. They are also permitted to collectively bargain for salary purposes, just not anything else.

Oh come on greekdog, benefits ARE salary.. particularly since so many public employees have, in the past been specifically asked to accept benefits in lieu of pay. This was done in good economic times because benefits were cheaper to provide. Now, the state is basically going back on that.

and it is very often those "other issues" that teachers most need to bargain for... people don't go into teaching to get wealthy.

[thegreekdog]

Oh come on greekdog, benefits ARE salary.. particularly since so many public employees have, in the past been specifically asked to accept benefits in lieu of pay. This was done in good economic times because benefits were cheaper to provide. Now, the state is basically going back on that.

Yep.

But, if you say they can collectively bargain, just not for salary.. then you are saying they can still bargain for benefits?

I don't know the answer. According to some information posted by Doc Brown, one of the issues appears to be hiring and firing (or, more accurately, closing down a prison that houses one prisoner but has 5 prison guards).

[PLAYER57832]

I don't know the answer. According to some information posted by Doc Brown, one of the issues appears to be hiring and firing (or, more accurately, closing down a prison that houses one prisoner but has 5 prison guards).

Specific issues like this get brought up and are akin to the "well, you die if you get socialist medical care".. "well you die if you don't" arguments. They are problems, but not the result of either having or not having unions.. the only difference is in the method of change.

Any union worth its salt will be happy to say a prison with 1 prisoner and 5 gaurds needs to be shut down. However, if you have a prison, it will take more than one gaurd because they have to be watched 24/7. It could be that this area has seen a huge drop in crime or perhaps the prison is of such poor quality it is being no longer used, just is waiting to be closed... etc. OR, it might be that this is the only prison for 300 miles and the community wants to have a prison, fougth hard to keep one.

Anyway, that is a sense/nonsense issue, but not particularly a union one.

[thegreekdog]

You should read Doc Brown's post (and link) for better information. Essentially, Michigan agreed to house the prisoner in one of its prisons, but the prison guards' union refused to have the prisoner moved because the five prison guards would lose their jobs. This appears to be an issue with the state employees union. I think I've said this before, but I have no problem with the concept of unions. I do have a problem with how some unions operate. This is an example of where I would have a problem.

[PLAYER57832]

You should read Doc Brown's post (and link) for better information. Essentially, Michigan agreed to house the prisoner in one of its prisons, but the prison guards' union refused to have the prisoner moved because the five prison guards would lose their jobs. This appears to be an issue with the state employees union.

Yes and no. I would say it is an example of abuse.. assuming there is not more to this. Usually, there is "more to it", but my original point stands. OF COURSE, you can find examples of idiocy, but I can point to examples of corporations that lay off people who get hurt (they allow them to return, then fire them for "cause"), or who are just shy of retirement, etc, etc, etc...and downright true obnoxiousness
(but I won't because I don't want this to turn into another "oh yeah..."thread).
The point is that those examples are not enough to show the entire system is broken.

I think I've said this before, but I have no problem with the concept of unions. I do have a problem with how some unions operate. This is an example of where I would have a problem.

Again, dealing with specific unions is one thing. Walker eliminated whole category of unions. And, as I have noted elsewhere, alone its maybe just a poor choice on his part. HOWEVER, when you take it into the context of what is happening everywhere, across the nation, there is an absolute and definite problem with attacking unions.

Its like the old "frog in water".. they take a piece here, a piece there and suddenly we have nothing left. Meanwhile, all those people complaining about "government intervention" utterly ignore the far greater abuses of companies.. and suddenly, the government is gone and companies have no one to say "no". That pretty much did happen in the banking industry in the 90's and 00's and is happening now on other fronts.

[Woodruff]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut.

In the real world, these are one and the same. Because now those teachers will have to pay for what those benefits covered out of their pocket.

I don't know the answer. According to some information posted by Doc Brown, one of the issues appears to be hiring and firing (or, more accurately, closing down a prison that houses one prisoner but has 5 prison guards).

HE'S A BAAAAAD MAAAAAN!

[Night Strike]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut.

In the real world, these are one and the same. Because now those teachers will have to pay for what those benefits covered out of their pocket.

In the real world (aka private sector), people pay 7-12% of their income for their pensions and 15-25% for their health care. The Wisconsin unions were paying 0.8% and ~5%, respectively. When the teachers are making 40-50k per year (aka 9 months) as well as 30-40k per year in benefits (that they pay next to nothing for), I'd say there is room for sacrifice.

[Woodruff]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut.

In the real world, these are one and the same. Because now those teachers will have to pay for what those benefits covered out of their pocket.

In the real world (aka private sector), people pay 7-12% of their income for their pensions and 15-25% for their health care. The Wisconsin unions were paying 0.8% and ~5%, respectively. When the teachers are making 40-50k per year (aka 9 months) as well as 30-40k per year in benefits (that they pay next to nothing for), I'd say there is room for sacrifice.

Your statements here have absolutely nothing to do with my point. Was there a reason you felt the need to try to counter my statements with the irrelevant information?

[GreecePwns]

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

But here is the thing. These kids who's teacher's pay is being cut won't be adults for some time. The businesses that are benefiting recieve a very temporary benefit and, realistically may not even be around in 10 years. The kids will be.

So, again, its about providing for businesses short term needs at the expense of our children.

and greenpeace got into the nitty gritty of how and why, but just the philosophy is plain wrong.

The teachers' pay isn't being cut. Their benefits are being cut.

In the real world, these are one and the same. Because now those teachers will have to pay for what those benefits covered out of their pocket.

In the real world (aka private sector), people pay 7-12% of their income for their pensions and 15-25% for their health care. The Wisconsin unions were paying 0.8% and ~5%, respectively. When the teachers are making 40-50k per year (aka 9 months) as well as 30-40k per year in benefits (that they pay next to nothing for), I'd say there is room for sacrifice.

And they were prepared to make the sacrifices, but Walker never offered a compromise.

[GreecePwns]

They didn't actually cut taxes. They provided credits and incentives for businesses that create jobs. So, it's not business tax cuts in the strict sense of the term (like cutting the tax rate). In order to take advantage of the tax advantages, a business actually has to create more Wisconsin jobs. So, in order to get the $2,500 per person (I think that's what it is), the job has to be created first. That's why I was keen on getting someone to post the tax bill instead of throwing out the words "tax cuts for businesses."

Greecepwns - typically with tax credits there is a limit to the amount of credits the state will grant. I'm not sure what Wisconsin's limit is. With tax incentives (i.e. where the state gives you money), there is also a limited pool of money. And if the money is not used up, it goes back into the state's general fund (at least that's how it works in Pennsylvania with the film credits and the R&D credits that go unused).

Furthermore, the tax credit (if it's $4,000 per job) is most likely a one-time credit (all but one state, I think Maryland, do one-time credits). If we take the $45,000 per job and $3,150 in income tax, that's one year of tax which, as you said, does not offset the corresponding credit. Assuming that person sticks around for more than one year, you've made up for the $4,000 tax credit in two years. I hope that helps.

I want to say this is it, but I am uncertain. Disregard the following if I am incorrect. All bills are posted under the "Bill Search" section of the official website of the legislature. I found this under 2011 Wisconsin Acts. Couple of notes.

-I see something about the credit lasting two years after a company relocates.

-I didn't find the $2,000 and $4,000 figures specifically in the bill, but it's safe to say it's true when multiple sources are saying it is.

-I see this is not a one time credit, but an extension of an existing one, according to the Wisconsin State Journal. If this is true, then the benefits from this are even less so. Can we verify if this is true?