The “Big Five” Lies in the Walker Budget – in his own words…

To all the hard-working, Democracy loving, fiscally responsible people of Wisconsin,

You have been misled. Governor Scott Walker has completely misrepresented his budget and Wisconsin’s fiscal state. Before, during, and after debate on this budget, Walker has lied to you. His statement released after the Legislature’s budget passage continues these lies:

“I am proud of the work done by the Legislature, which passed a budget today that isn’t built on accounting gimmicks, use of one time money for ongoing expenses, or tax increases.  The budget approved by the Legislature is an honest document that balancesWisconsin’s $3.6 billion budget deficit so that our children and grandchildren aren’t saddled with mountains of debt in the future.” 

Moving forward, I plan on taking time over the next two weeks to review the changes made by the Legislature prior to signing the bill before June 30th.” 

These lies were repeated so many times by Walker, GOP Legislators, and the media they have passed for conventional wisdom. As a service to the people of Wisconsin who may have fallen prey to Scott Walker’s budget hijinks, here are the lies in Scott Walker’s statement exposed:

Piece #1 – The “…budget today…isn’t built on…tax increases.” (see quote above)  In a January 13, 2011 memo from LFB Director Bob Lang, the LFB specifies two significant tax increases. These tax increases affect poor, lower-income residents who rely on the Earned Income Credit and Homestead Tax Credit to simply make ends meet. Through this budget, the state is increasing the tax burden on the lowest wage earners by nearly $70 million over two years. In addition, fees will increase by over $100 million,  targeted primarily at tuition increases for UW students, and vehicle title fees to segregated funds.  A tax is a tax – it is a lie to consider these anything but what they are.

Piece #2 – “The budget…isn’t built on accounting gimmicks”  Scott Walker promised, backed by GOP Legislators, to not raid segregated funds to balance the budget. This was a practice he slammed Jim Doyle over, and repeated this promise again and again. A June 14, 2011 memo, again from LFB Director Bob Lang, proves this to be a blatant lie. The memo itemized over $400 million in segregated fund “transfers”. Most of the raids transfer funds from General and Environmental Funds into Transportation Fund (to fund road construction boondoggles). The LFB memo confirms these funds are “used for purposes other than…the funds have traditionally been used.” The fund raids themselves are gimmicks used to give the appearance of a “balanced” budget.

Piece #3 – “…our children and grandchildren aren’t saddled with mountains of debt…”  In the biennial budget, Scott Walker has given huge tax breaks to corporations and the wealthiest individuals to make Wisconsin more “business friendly.” Regardless of the fact that tax breaks don’t create jobs (see item #3 of the link – includes charts!); there will be a significant price for our children to pay - long after Walker is out of office.  The June 9, 2011 LFB memo from Rob Reinhardt itemized the long-term consequences of these tax cuts for large corporations and the wealthy. The total LFB projection in lost revenue over ten years – over $2.3 Billion. Yes – BILLION. Most of the revenue loss is due to the changes in Capital Gains and Combined Reporting, benefitting the highest income earners and largest corporations in Wisconsin. Scott Walker will be out of office long before this revenue loss impacts Wisconsin’s children.

Piece #4 – “…our children and grandchildren aren’t saddled with mountains of debt…” (part 2) The June 14, 2011 LFB memo from Fiscal Analyst Al Runde unveils the most disturbing lie about the Walker budget. Walker’s debt restructuring plan provides for longer term debt service, incurring greater interest costs for the state. The plan simply allows the Governor to delay debt service payments beginning in 2013. Scott Walker will delay debt payments, accruing higher interest, and literally “kicking the can down the road.”   The impact? The state standard for debt-to-revenue ratio is no greater than 4%, with a target debt ratio of 3-3.5% of General Program Revenue. Table 2 in the linked memo shows the debt-to-revenue ratio projections.  THIS IS CRITICAL – Debt ratio grows from 2.28% this year, to almost 5% next year. In 2013-2014, it grows to OVER 5%, even with a generous 4% growth in revenue. A debt-to-revenue ratio of over 5% is higher than ANY budget under Jim Doyle. This literally saddles Wisconsin with increased debt AFTER Walker’s term is over.  

Point #5 - This budget “…balances Wisconsin’s $3.6 billion budget deficit.” No, it doesn’t. The June 15, 2011 LFB memo specifies the fiscal condition of the Transportation Fund. The fund will operate in a deficit after this fiscal year. Through the raiding of the General Fund (see above), which is a one-time transfer, the Transportation Fund will be in a $244 million deficit for the 2013-2015 bienium.  In addition, because of Walker’s method for debt restructuring (see above), the Transportation Fund will require higher levels of bonding to maintain equal levels. The total deficit, over the 2013-2015 bienium - $319 million. A deficit which will come due AFTER Walker is out of office, and after the Road Construction lobby has been paid – with money raided from the General Fund, and debt sold to our children.

Simply stated, Scott Walker has lied. He has raised taxes, raided funds, created a critical future revenue shortfall, sold debt to future generations, and created a budget deficit. Spread the word, share the facts, and make sure Wisconsin knows the truth about this fiscally (and socially) disastrous budget – which doesn’t work for anyone!

Thanks to all contributing legislators in sharing their research, time, and efforts in this unprecedented time. On Wisconsin!

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8 Comments

  1. Mike Gambsky

     /  November 29, 2011

    AND WHY SHOULD ANYONE BELIEVE THAT THE ABOVE STATEMENTS ARE TRUE? NOT BECAUSE SOME CRYBABY CHOSE TO PUT WORDS OUT FOR ALL THE OTHER CRYBABIES TO READ. SCOTT WALKER RAN FOR GOVERNOR ON A PROMISE TO DO EXACTLY WHAT HE DID. THE PEOPLE OF WISCONSIN HAVE SPOKEN. DURING THE SENATE RECALL WE WITNESSED PEOPLE COLLECTING SIGNATURES IN CARS WITH OUT OF STATE PLATES. WHO DO YOU SUPPOSE HIRED THOSE GUYS? GROW UP!

    Reply
    • Mike – I enjoy comments from the blind followers of Scott Walker and the current GOP more than comments that agreee with my point of view. First, the statements I make ARE true – if you actually read the blog, and followed the links, you will find all sources are accurate and non-partisan. Second, Walker did NOT run on the specific policies that have created so much passion for his recall – if he had, he would not have won the election, and he knows it. Finally, in regard to your assertion that there are “out-of-state” people gathering petitions. Nonsense. I have spent time in rural Wisconsin over the past two weeks, and have witnessed firsthand the large number of local volunteers sacrificing holiday weekends to gather signatures because they know it is the right thing to do (and Constitutional). My next blog will address that assertion by the right-wing spin machine. By the way – here is an interesting list for you:

      Lewis of Mattituck, NY – $2,000
      Margaret of Mattituck, NY – $2,000
      Harry of Denver, CO – $500
      Peter of Newport Beach, CA – $500
      Fred of Cape Coral, FL – $250
      Thomas of Seattle, WA – $250
      Steven of Washington, IL – $250
      Richard of Napa, CA – $200
      Robert of New York, NY – $200
      Norman of Atlanta, GA – $200
      John of Maumee, OH – $200
      Dick of Greenwood Village, CO – $200
      Richard of Tuscaloosa, AL – $200
      Michael of Fernandina Beach, FL – $200
      Ernest of Vero Beach, FL – $200
      Richard of Milwaukee, WI – $200
      Emily of Neptune Beach, FL – $200
      Kenneth of St. Marys, GA – $200
      Harry of Northport, NY – $200
      Mary of Des Moines, IA – $200
      John of Tucson, AZ – $200

      Note – only ONE name from Wisconsin on that list. It is the latest list of donors over $200 to the “Say No to the Walker Recall” fund from “The Campaign to Defeat Barack Obama”. Now – who’s relying on out-of-state support? If you don’t believe me, here is the link to the email that was sent to Walker/GOP supporters:

      http://paracom.paramountcommunication.com/hostedemail/email.htm?CID=10484897138&ch=B904EEEE0016F12E4BBC3E3F8FDB9925&h=5e4a81dbfc3d4bcd1cf61030059a8c03&ei=s4fodqTNk

      Keep reading, Mike – maybe someday you’ll get it.

      Reply
  2. Cody

     /  December 18, 2011

    proud to protest in madison on day 1. proud to vote for kloppenburg. proud to move up north in time to vote for holperin. proud to sign the petition.

    back in madison when they were shouting “recall” i didn’t think they/we’d be able to do it. but it looks like its getting close! cheeseheads 4 lyfe

    Reply
  3. Don

     /  December 28, 2011

    Walker says he does not support a recall and has all sort of problems with it. He led a recall in Milwaukee and that is how he got the job there…………interesting…

    Reply
  4. Tyrone

     /  January 3, 2012

    I see the deception in this blog. Interesting, indeed. The tax-cuts for business’ are to keep business’ in this state (they have been leaving in past years) and bring in more business from out of state. We are struggling to stay competitive with states around the country with our previously anti-business attitude. Why stay here when Texas will welcome the jobs with open arms?

    Doyle ‘raided’ the transportation fund to the tune of $1.3billion dollars to help balance his general fund balance (the only fund looked at to ‘balance’ a budget…wrong as it might be). The general fund is supposed to pay off the ‘bills’. Walker took money from funds that were no longer in use. What you refer to as the “environmental fund” is the ‘petroleum environmental cleanup fund’. It would be a fund in excess financially if not for Doyle robbing it of $180million, which we are now trying to pay back. The petroleum fund is in the same neighborhood as transportation, hence Walker used $39million from this fund to help fund the transportation fund. It is all transportation! Call it a loophole if you want… Funny how you all kick and scream when Walker uses money from the General fund (used for paying bills) to pay the bills, while Doyle took money from other funds (1.3billion from the transportation fund alone) to balance the same fund that Walker now uses to pay the state bills. The bienium numbers with debt/revenue ratio are a nice touch right off the desk of a democratic state senator. These projections do not include the additional cuts that Walker has proposed, but have not passed into law. Nor is there any way of factoring in increased revenue from new business’ adding jobs, therefore decreasing unemployment benefits, while increasing tax revenue. These numbers include tax cuts, but we have not seen the effects from tax cuts to this date. Business’ moving INTO this state does not happen overnight. You speak of a bienium total deficit of $319 million. We are failing to include current and future revenue increases. Don’t forget we paid off $300 million in illegal Doyle debt this past year alone! Doyle left one heck of a mess and we are seeing how much work it takes to get out of it. Even using your bienium numbers the debt/revenue ratio seems to improve after reaching the peak bienium you use in this article.

    I see a ton of deception in the news and many people unfortunately fall for the traps. Keep it up, like the feds have done with the ‘unemployment numbers’ that we all have now seen proven extremely inaccurate. This whole thing is about beating the chest and trying to get a fiscally conservative governor out of office. We have public sector employees that are out of touch with the reality that the private sector has been living for many years. The public sector should be thankful to not be layed off as Doyle suggested and still be paying less that half of what the private sector pays for their own benefits. We all know that this is what it is all about…..

    Reply
    • First, in response, I would never defend the way Jim Doyle governed this state. In fact, he and ALL his predecessors going back to Thompson put us in the position we are in – that coupled with the ruinous policies of the Wall Street/Corporate elite. The facts I cite are inarguably true, Tyrone. Each of the points I make are examples of specific economic and policy lies presented as truth by Scott Walker and the GOP. Your public/private sector arguments are tired and proven to be false – it is merely an example of the GOP power brokers game of “divide and conquer” the middle class. Corporations are leaving this state and nation because they have incentive to do so – higher profit and cheap labor. When you accept the facts about why we are where we are (and yes, both parties are to blame for putting power and money through corporate political interjection), the you can drop the “Doyle is to blame” argument and see what Walker and his ilk have really done to this state.

      Thanks for your comments, and for reading. They are greatly appreciated.

      Reply
      • Bobbie Johnson

         /  May 28, 2012

        “…. it is merely an example of the GOP power brokers game of “divide and conquer” the middle class.”

        Interesting to read this comment written in January now in May after Walker was caught on film using those very words. You would think it would cause Walker supporters to sit up, take notice and realize there is truth in your words…. but probably not. The “stuff” seems to roll off Walker just as it did with Thompson.

  5. Flaming Liberal

     /  January 5, 2012

    I love scott walker

    Reply

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