Claim: Walker “introduced eight consecutive budgetswithout an increase to the property tax levy from the previous year.”
Reality: It’s a carefully worded statement, but “sneaky and misleading,” saidAnna Landmark, research director of One Wisconsin Now (OWN).
On the faceof it, Walker’sstatement makes it sound like he hasn’t raised property taxes since proposinghis first budget.
But that’snot the whole story, of course.
Here’s howit works: Walkerwill introduce an unrealistically stringent budget each autumn. The countyboard then has no choice but to add spending and tax increases to keep up withinflation and other increased costs of doing business. Walker will veto the changes, and the boardwill override the veto. Then Walkerwill use that budget as the base line for his next year’s budget.
And, voila! Walker can say that hehasn’t increased taxes and spending because the board has made the toughdecisions.
So how muchhave property taxes increased during Walker’sreign? OWN crunched the numbers and found that Walker’s proposed budgets from2003 to 2010 raised property taxes about 17%, while he’s increased spending35%, more than Gov. Jim Doyle did during the same period. What’s more, fees onlicenses, permits, fines and forfeitures have increased a whopping 129% during Walker’s tenure.
“There isthe world that exists, in which he has made these increases, and then there’sthis fantasy world of the campaign he’s running,” said OWN’s executivedirector, Scot Ross.
Anotherproblem, of course, is the lengths to which Walker must go to not increase taxes whiletrying to come up with a budget. Walkerfailed utterly when he introduced his 2010 budget with a $32 million hole in itthat was to be magically filled through $32 million of wage and benefitconcessions during union contract negotiations. But Walker’s labor negotiator had never proposedthese concessions to the unions. That budget still hasn’t been resolved andprobably won’t be by the time voters cast their ballots this fall. In themeantime, Walkerhas forced many union workers to take 22 unpaid furlough days in 2010,furloughs that are wreaking havoc in places like the Milwaukee County MentalHealth Complex and the Milwaukee County Zoo. It’s likely that the cost of thefurloughs in these critical 24/7 operations will outstrip what has been saved.
Claim: Walker says that as governor he wants to decreasetaxes on employers, property owners, wealthy investors and retirees.
Reality: This makes for a great sound bite on the Republican campaign trail, butWalker’s tax proposals would blow a $5 billion hole in the state budget,according to research conducted by OWN.
First off, Walker would inherit a$2.3 billion deficit. Then he wants to slash the income tax for the top 1% ofearners, which would cost the state $287 million over the biennium. He alsowants to reopen the “Las Vegas loophole” toreward Wisconsin companies that set up phony offices in states without a corporateincome tax to avoid paying Wisconsin statetaxes. That move would set the state back about $375 million. Then he wants toroll back the capital gains tax paid by the state’s wealthiest people. Cost tothe state over two years: $243 million. Walkeralso wants to phase out taxes on retirement income—regardless of the retiree’swealth—which would cost the state a whopping $920 million over the course oftwo years. And Walker’slatest gimmick is to put the sales tax from new cars into the transportationfund, which would take more than $1 billion out of the state’s general fund.
Total costto the state: $5.125 billion during Walker’sfirst two years in office.
Although Walker is constantlycampaigning, he’s been pretty silent about how he’d make up for these cuts. Hisonly proposal thus far is to require state employees to contribute to theirpensions. But that would generate a mere $185 million—$4.94 billion short ofwhat he’s slashing from the state budget and handing to the state’s wealthiestresidents.
Claim: Walker plans to add 250,000 jobs during his firstterm as governor.
Reality: Interesting, because the county’s unemployment rate has increasedwhile Walker’sbeen in office. This promise means reducing the state’s unemployment rate tovirtually zero. Walkeroffers no details on how he’d create jobs beyond cutting taxes and improvingeducation, and it’s hard to improve education with less revenues.
As countyexecutive, Walkerhas cut 20% of the county’s workforce. Many of those jobs have vanished, whileothers were outsourced to private companies based out of state, such as themultinational corporation Wackenhut/G4S, which took over some of the county’ssecurity services.
Then there’slast week’s Bucyrus International dust-up, which has now been resolved. BucyrusCEO Tim Sullivan, a political conservative, commended the Obama administration,Sen. Herb Kohl, Gov. Jim Doyle and Milwaukee Mayor Tom Barrett for engaging inan “all-nighter” to resolve the dispute between the South Milwaukee manufacturer and theExport-Import Bank. And how did Walker handlethe threat to a major corporation within Milwaukee County?By taking out a full-page ad in a Racinepaper to whine about the situation on the day Obama visited that city.
Claim: Walker is the one candidate who can helpHarley-Davidson.
Reality: Walkerhas tried at every turn to seem “cool” by being a big Harley supporter. Hislatest gimmick is to promise to help Harley by reviving the Las Vegas loophole (otherwise known asrepealing the combined reporting law), which Walker (not Harley) claims iscosting the motorcycle manufacturer $22 million in taxes.
The problem,though, is that it just isn’t true. Combined reporting hasn’t caused Harley’stroubles and, what’s more, the state’s new tax policies are helping its bottomline. The new corporate tax policies benefit Wisconsin-based manufacturers. “Ifthe change [to corporate tax policies for Wisconsin-based manufacturers] hadnot been made and Harley had continued to pay taxes at its 2005 rate, then in2008 its income tax bill would have been $16 million instead of $1 million,”concluded a study by the Institute for Wisconsin’s Future.
Claim: Walker “invested over$199 million in renovations and improvements to General Mitchell International Airportwithout increasing the property tax levy.”
Reality: Of course the airport didn’t use theproperty tax for its improvements. “The airport doesn’t rely on the propertytax,” explained Milwaukee County Supervisor Chris Larson, because it uses feespaid by airlines and passengers.
Claim: Walker “implemented a pension obligation plan tosave Milwaukee County taxpayers $237 million.”
Reality: Voters in Milwaukee Countyrejected issuing bonds to cover pension payments in a 2005 referendum. But Walker succeeded ingetting almost $400 million in these bonds approved by the county board andstate last year. While “bonds” may sound safe in theory, in reality they’reactually kind of risky. The idea is to invest the $400 million from thebond sales in hopes of receiving an interest rate that is higher than what thecounty pays on the bonds. This is likerefinancing your house and investing the money in volatile tech stocks, andhoping that you’ll turn a consistent profit.
Back in2008, the Public Policy Forum looked at Walker’s plan and was worried: “In light of the existing turmoil in the nation’sfinancial markets, it is highly questionable whether [pension obligation bonds]could and should be issued in this calendar year [2009], and whether theexisting plan would have the desired impact in light of an almost certaindramatic increase in the unfunded liability due to investment losses.” Guesswhat? Walkerdid in fact implement them in 2009, a year full of financial turmoil.
And the $237 million saved? Walker campaignspokeswoman Jill Bader explained that the savings are spread out over 35 years.
What’s more, Walker failed to clean up the pension systemhe’d inherited. In fact, the JournalSentinel won a Pulitzer in 2008 for its reporting on how a $50 millionloophole still existed in the plan five years after Walker was voted into office.�
Claim: “From2002 through 2010, Scott and Tonette Walker have given back over $370,000 ofhis salary to the county.”
Reality: Walker likes to brag thathe returns a portion of his salary to the county to show that he’s frugal. Butin 2004, a campaign rival noted that despite Walker’s claims of returning some salary, hewas still drawing his pension and benefits on his full salary.
