Does Wisconsin Governor Scott Walker Care More About Corporations Than People?

March 10, 2011

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Scott Walker, governor of Wisconsin … he’s been in the news lately, hasn’t he?  There was an interesting tidbit that a lot of people missed back in January 31st, before this whole shebang started.  Governor Walker signed into law a little provision that says companies moving to Wisconsin will not have to pay corporate tax for 2 years.  In addition, he pushed through $140 million in special interest group spending in January.  He was busy his first few weeks!  Well this is strange, the $137 million dollar shortfall that he claims is why he’s going after the public employee unions is almost the same amount as the $140 million in spending he rammed through in his first few weeks in office.  I’m sure that’s just a coincidence, though – right?

Well, there’s a bit of very public evidence that a lot of people have laughed at but I feel not as many looked into – the “prank” phone call with Scott Walker and a journalist claiming to be David Koch.  In this phone call there is zero talk of tight budgets, a dire need to cut $130+ million, or really any significant discussion on fiscal issues.  The discussion at hand was all about the “us vs. them” philosophy and crushing the whole idea or unions.  One might even say that Scott Walker created a tense environment for the express purpose reducing or even stopping union power.  Heck, why stop there, why not just give your corporate overlords state utilities for pennies on the dollar?  A “loophole” in a proposed bill could do just that. 

I know, some of you are on the governor’s side on this.  The unions are antiquated, they don’t need power, heck, those overpaid state employees are just being greedy, right?  Well, on average public sector employees earn about 10% less than their counterparts in the private sector.  In addition many states have a mandatory minimum amount that gets put into a retirement fund.  Finally with so many recent state’s financial woes many state employees are now paying more money for the same or sometimes lesser health plans.  Very often state health plans are built using no or few bid contracts and the administer of that health plan is simply raking in the money with little reason to care for the wellbeing of the person at the other end of the plan – denial of benefits would look great on a bottom line if/when those health plan contracts go up for renewal, right?  In one state, North Carolina, the health plan was no-bid and the details are known only to a few. 

Still not convinced about unions?  How about this quote then:  ” … one of the most elemental human rights – the right to belong to a free trade union.”  Surely some liberal nutbag must have said something like that, right?  Dennis Kucinich, or Franklin Roosevelt?  It was Ronald Reagan.  He himself belonged to a union, in fact.  In a world where money is power unions allow those who don’t have as much to group together and argue and barter on equal footing with those who do have a lot.  In fact, a large majority of people say every American has a right to join or form a union, over 60%. 

Put all these things together, and what do we get?  A governor in Wisconsin who had $43,000 in direct donations from the Koch brothers and a multi-million dollar ad campaign paid for by Koch money that helped him get elected, and now he’s seeking to crush union power under the guise of financial woes he created and set his corporate masters up take over state utilities, probably under the guise of “if things get worse we’ll have to privatize our utilities” and suddenly things will be worse.  This and the North Carolina health plan are just two examples where corporate money flows to the politicians only to have taxpayer money – almost invariably from the middle class – flow back to the corporations.  Once again, another reason why we need complete transparency and a cap on any kind of corporate political contributions.  “We the people” is rapidly turning into “We the corporate rich people” and that ideal leaves a lot of poor huddling masses out in the cold.

12 Comments (+add yours?)

  1. kosmo
    Mar 10, 2011 @ 09:49:27

    I’m not going to defend all of Walker’s action, but the idea of providing tax breaks to companies moving into the state might not be altogether negative.

    Let’s say Acme Industries is located on the Iowa/Wisconsin border. If they stay in Iowa, here’s how much they will pay in Wisconsin state taxes in 2011 and 2012: $0.

    Now, let’s say they move to Wisconsin and have a 2 year tax abatement. How much will they pay in Wisconsin state taxes in 2011 and 2012? That same $0.

    In others words, it’s basically budget neutral for 2011 and 2012.

    However, if they move to Wisconsin, they’ll pay WI taxes in 2013 and beyond … tax money that the state would never see if the company stayed in Iowa. Plus there is the issue of providing employment. That state that actually loses if the jobs move is Iowa.


  2. Zarberg
    Mar 10, 2011 @ 10:00:32

    Tax breaks to corporations are a zero-win situation for states and the citizens. North Carolina is continually ranked in the top 5 for states to do business in ( ), yet one of the few political catchphrases repeated by both sides is the need to lure business here – almost always with tax loopholes, incentives, breaks, and sometimes outright grants. Boiled down to the simplest terms, corporations give corporate money to politicians, politicians write laws that give corporations state and individual money, and the only winners are the heads of those corporations and the politicians. Why else would a politician spend millions of dollars to get a job that pays at most $250K a year if they weren’t promised cushy lobbyist jobs for making legal loopholes? Yes, even your favorite politician has done that. Politics is a game about who sucks the least and the playing field is filled with so much suckage it’s hard to tell one from the other right now.


  3. kosmo
    Mar 10, 2011 @ 10:29:27

    You may be right for NC and other states that have no trouble luring businesses … but for some states, I think it can be a win. The key question is whether the tax break convinced a company to move, when that company would not have otherwise moved. If that’s the case, there’s a net increase in tax revenue in years 3 onward. if the company was going to move to the state anyway, then you’re correct that it’s money down the drain.


  4. wuzafuzz
    Mar 10, 2011 @ 12:25:34

    Both sides of the Wisconsin dustup have conducted themselves disgracefully. I am not a fan of Gov Walker’s handling of the situation. On the flip side, the unions have presented them selves in an overly positive light. Their self-promotion has included so many half truths and untruths as to be laughable.

    It’s true public sector workers often earn less than private counterparts. However, it’s my understanding that is not true in Wisconsin. From what I’ve heard they generally earn equal or higher pay there. However it’s also true that many government jobs don’t have private industry comparisons. For instance, I was a police officer, airport patrol officer, and later, a crime scene investigator. Not too many of those in private industry. I understood that public service had it’s costs, but it was a calling and I was comfortable with the attendant sacrifices. The rapidly swelling ranks of government employees suggests there is no shortage of people who feel the same.

    The part about President Reagan is true, but doesn’t paint a complete view. He did belong to a union and was even the leader of that union. However, as President of the USA he fired every single Air Traffic Controller who went on strike with their union. Clearly he felt they were out of control. Even FDR, the progressive poster child that he was, said public employees should never be permitted collective bargaining.

    The idea behind unions is fine. I used to belong to unions and was even a shop steward. Unfortunately the corruption and greed I witnessed was shocking. Too often the members get greedy and lazy, and allow themselves to be run by unabashed communists. I was even forced to pay dues that helped fund whacko politicians who insisted employees in my profession were a bunch of evil, racist, Nazi’s.

    Interestingly, no one is whining about Colorado. Our state employees are prohibited from collective bargaining. It’s the law. Why isn’t anyone griping about that? Oh yeah, we have a Democrat governor. Apparently there is only a need to protect people from Republicans. When Democrats, or worse, Liberals, violate our “elemental human rights” they get a pass.

    Can unions be a good thing? Yes. Once upon a time they championed worker’s rights and helped birth many labor laws we take for granted today. Of course those laws have been in place for decades now. Arguably the need for unions has diminsihed. To the extent there remains a need for a collective voice we can find that voice through organizations that don’t have the power to soak the citizenry they serve.

    Wuzafuzz out.


  5. Squeaky
    Mar 10, 2011 @ 14:28:07

    FASTBALL! You’re either with me or with the trolls! Shout out to that whack job Charlie Sheen.

    Don’t be naive Zarberg. All states make sweetheart deals to get businesses to come there. For some states it’s one of the few ways to get people to move their businesses there. If states and cities don’t make concessions they’ll be on the losing end time-after-time.

    As for unions, I was in one and they suck. It drained an extra $100+/month from your paycheck and I never saw a benefit. What incentive do you have to work hard if everyone gets the exact same thing? I feel fortunate that I work at a business that actually rewards me based on my own merits. If I work harder and turn out better results than the person next to me, I am rewarded more for it.

    I believe that unions are outdated, I fail to see their worth. When you have groups that make it so that union employees can’t be fired, that takes away any control and leaves a business in anarchy. Think of the Chrysler employees taking their lunch at the local park, drinking their 40 oz and smoking some bud then going back and putting your Jeep together. UAW even had the balls to fight the employees termination! You would think that the remaining employees would have learned a lesson, but less than six months later more Chrysler employees from the same plant were caught smoking marijuana at lunch. Is this how highly paid employees act?

    Now you have a situation where union employees realize the free ride is about to end and they are making death threats to elected officials. That’s real mature and certainly makes many of us understand why we aren’t standing behind the unions.

    My step-father-in-law is a Teamster Union steward and I am always sickened by the stories from him. He tells me that when employees run out of vacation they call in sick and there is nothing the business can do about it. He told me about a time that a union driver was mad about something and this 45 year old man was driving directly to the terminal to assault the manager that made a decision that he didn’t like. Part of the collective bargaining contract was that they could file a grievance and have the decision reviewed, but that wasn’t good enough for this guy.

    Then, there is my friend’s husband (“Steve”) that is a welder that owns his own small business. The Budweiser factory here in Northern Colorado didn’t have any union welders on staff that were qualified to complete some special welding that needed to be done. When Budweiser hired Steve to complete the week long job the union welders were mad. They destroyed the work he had done on two separate occasions, broke some of the equipment he had left at the side and vandalized his work truck (scratching SCAB into his paintjob). When the job was completed he billed Budweiser for the extra work to fix the damaged work, the damaged tools and the vandalism to his truck. Is this really how union workers operate?

    I’m sure others have had positive work experiences with unions, unfortunately I haven’t. Based on my experiences I have to say that Governor Walker is making good decisions. If the workers are worth what they’re paid, they’ll be fine. They may even turn out better if there is no “contracted” pay increase. Those that work hard will undoubtedly be better off in a union free working environment. It’s the hot heads, the lazy, the workers that do just enough to get by that will pay a price. No more coasting, no more doing the minimum to get by and no more 3% raise across the board. Now they can interview for their job every day and demonstrate their value to the business like the rest of us.



  6. Zarberg
    Mar 10, 2011 @ 14:43:26

    Don’t confuse naïveté with idealism. Just because I point out the failings of a system in place doesn’t mean I don’t realize why those failings exist.

    Every state may make sweetheart deals to get business to come to them, but it’s a fairly new development in terms of US history, and it doesn’t make it any less wrong. Heck, in some situations it’s akin to blackmail – governers openly say they need to lower taxes by X amount or flat out give land to a corporation to get it to come here over another state. It’s yet another reason why we need absolute transparency in campaign contributions and to stop (or massively cap) contributions from corporations (and yes, unions too).

    As for unions, as you said, your personal anecdotes are just that. We already live in a climate where corporations have much more power than they did in the 50’s and 60’s, and we all know the lessons of corporate power gone astray – just read Upton Sinclair’s “The Jungle” for a dark example from our country’s past. I for one would be perfectly fine with unions being gutted if it meant corporate power was similarly shackled. Unions came about because legal frameworks at that time were undeveloped and sometimes completely corrupt. As corporate political power grows – and it will grow with their now unrestricted access to political advertising dollars – so will abuse of that power.

    I am a state employee in a state that does not have a union, and I already see apathy, waste, and fraud on an epic scale. The problem here is not with union-like organizations but with an entrenched upper and middle management that cares about CYA first and everything else last. My personal anecdote: I make about 20% less than my private sector counterparts (you can look it up online), my health benefits have been diminished and/or increased in cost for a few years in a row and I have a mandatory amount taken out for retirement in each paycheck. While this job has certainly been more stable than the average private sector equivilant, we’ve hit a time where even state employees face the prospect of layoff. My first day on the job I was literally disciplined for looking to improve efficiency because my boss only wanted me doing exactly what I was told to do and no more.


  7. kosmo
    Mar 10, 2011 @ 15:41:38

    I think there are instances where a union can help balance the power (bargaining with a huge company) and instances where the presences of a union shifts the power quite heavily toward the union (huge union bargaining with a small business).

    I support the right for people to unionize if they want … but I don’t plan to ever join a union.

    Good point about companies blackmailing their existing state with the threat of moving. I’m not really sure how to resolve this. There’s always going to be natural competition between states that want to bring more jobs to their state.

    I proactively moved my own job back to my home state. Never even got a “thank you” call from the governor.


  8. Squeaky
    Mar 10, 2011 @ 16:40:48

    Last FASTBALL from Squeaky for the day. **WINNING** (one more for Charlie the nutjob)
    I’d show you what I’m drinking but I’m NOT GETTING PAID!

    Ok, enough jocularity. I think you’re idealistic, but to the point of naive.

    Sweetheart deals are like any other business contract. If Kosmo had moved his job back to his home state I would have called if i were governor and given him a big fat thank you bonus. Kos, you were just happy that you didn’t have to live in that hell hole people call Illinois. If Chicago would secede that would be a huge improvement.

    BTW Zarberg, I totally get what you’re saying about your boss wanting you to keep your head down and not make improvements. That is rampant at a lot of places, union and non-union. I’ve never understood the mentality of don’t make waves, don’t make change and just coast. It sounds to me like you’d be a good fit in a non-union job where you could actually be rewarded for your creativity. I’m fortunate that my boss wants me to stir it up every chance I get. Tear things apart, put them back together and hopefully find a better way in the process.

    I understand your perspective, I just won’t ever see it that way.

    Have a good one BOYZ.


  9. kosmo
    Mar 10, 2011 @ 18:06:54

    Squeaky – funny thing is that I pay MUCH more in state income taxes in Iowa than I did in Illinois. Between 2 and 3 times as much.

    Not only should the gov have been happy to see the money go into the state coffers, they could have paid Illinois for the drop in revenue Illinois saw and still come out ahead.

    Exact same job, I just work from a MUCH smaller office and pay more in taxes.


  10. Squeaky
    Mar 11, 2011 @ 07:22:21

    Kos, you got screwed on most of that deal. That being said, living where you want to be is priceless. I’ve learned that family means more than any tax paid or reduction in salary.

    When I moved back to Colorado from Illinois our property taxes went from $6000 in Illinois to $2200 in Colorado. Salary stayed the same, cost of living is allegedy a little higher here though. Monetarily I didn’t come out ahead, but being near my Dad (Parkinson’s Disease) and my Mom (brain aneurysm) is worth every cent.

    That was one of my most important life lessons.


  11. kosmo
    Mar 11, 2011 @ 10:30:35

    Yeah, definitely a personal choice and not a financially based moved.


  12. Martin Kelly
    Mar 13, 2011 @ 19:38:00

    Ok, this is a strange comment for me. I am mostly agreeing with Zar. I say mostly because I still do not get public sector unions. If the pay is so much better in the private sector, then get a new job.

    Unions are very important in keeping corporations “human”. Corporations are set up to shield the executives and allow them to decide their own salaries and bonuses based on back scratching rather than performance. The Unions provide the fight back for workers that was completely lacking back when Sinclair was writing and is still today weak at best.

    My problem with public sector unions is what evil corporation are they fighting? If the people or the elected officials of a state are the enemy, then who are they serving? There is no negotiation possible. Since there is no commodity purchased, there is no profit margin that sets the shut down position for the “company” since government can just raise taxes to get more money. The consumer has no hand in the game either, since they cannot refuse to buy the taxes that are levied. The only response that these consumer have is to elect people tor reduce the costs.

    I don’t know about the early spending of the Wisconsin governor, unfortunately the news is not very deep these days, just headlines and opinion. Seems typical though. Our local government always presents police and fire as the only items in the budget that can be discussed. If we do not approve a tax increase, police and fire are the only areas that will be cut. It is just double speak, that is why they are successful politicians and none of us regulars are.


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