"Just Get it Done"

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.

-August 2, 2007

 

Home | About | Commentators | Recent Commentary | Reports by Subject | Reports by Author
Podcast | Contact Us | Blog | Polls | Contribute
Copyright 2009 Wisconsin Policy Research Institute