By Deb Jordahl
The
budgets proposed by Governor Doyle and State Senate Democrats have massive
tax increases and will result in even higher taxes and bigger deficits
down the road. But don’t
expect the media to call attention to the devilish details or to encourage
legislators to take their time sorting out facts and reaching a fiscally
responsible compromise.
Instead the media and the
Governor will spend the remaining weeks of summer calling on legislators
to just get the job done. Doyle
already set a bogus deadline of today for the legislature to finish work
on a compromise package. The
Governor knew the deadline was totally unrealistic, but he believes if he
can pressure the Republican Assembly to rush to compromise with Senate
Democrats, some of his most reckless and politically charged budget
proposals are more likely to pass.
Take the oil company
franchise fee.
Doyle’s budget includes
a 2.5% fee on the gross profits of oil companies doing business in
Wisconsin, but prohibits oil companies from passing the cost on to
customers. The State Senate
budget increases the projected tax from $270 million to $306 million over
the next two years to fund transportation programs.
The tax sends a terrible
message to businesses considering moving to Wisconsin or expanding
existing operations here --- and every legal analysis to date says the no
pass-through provision is unconstitutional.
Doyle, Senate Democrats and transportation interests seem to be
saying, “So what? We need
money for roads now. We’ll
just blame the big oil companies when they sue the state.”
But a recent legal
analysis indicates if the courts rule against the state’s no-pass through provision, the Transportation Fund could be forced
to repay all taxes collected plus nine percent interest and litigation
costs. The state’s
liability could top $1 billion dollars in six years.
Blaming the big bad oil companies might make for a good sound bite,
but it won’t pave any roads.
Doyle also hopes the
Senate Democrats’ $15 billion dollar universal health care plan will
make his expansion of BadgerCare
look like a reasonable alternative toward making health care more
accessible and affordable. But
Republicans should not agree to a massive expansion of a government run
entitlement program that relies on more uncommitted
federal funding and an increase in the state cigarette tax, an equally unreliable
revenue source.
If Governor Doyle wants
to expand BadgerCare to a new population, it should be done as a pilot
program coupled with measures to reduce county Medicaid costs and
initiatives that encourage employers to pursue true cost saving programs
like Health Savings Accounts. Wisconsin
is one of only four states in the country that does not allow state tax
deductibility of Health Savings Accounts. Any agreement on health care should remove that barrier.
A compromise is an
accommodation in which both sides make concessions, not a contest of wills
where one side eventually caves into pressure abandoning its core values
and principles.
Republicans have a duty
to work toward a budget compromise but they are not obligated to accept
irresponsible taxing and spending programs that could have devastating
consequences for the future of the state.