Wisconsin targets public employees

Jeff Tyler Mar 1, 2011

Wisconsin targets public employees

Jeff Tyler Mar 1, 2011


Kai Ryssdal: It’s tempting to say the drama in Wisconsin is drawing to a close. Governor Scott Walker delivers his budget this evening. How he plans to deal with the multi-billion dollar deficit the state’s looking at over the next two years. What’s more likely, though, is that once everybody sees the actual numbers, the politicking will only get more intense. About the budget. And about the governor’s plans to weaken collective bargaining rights for state workers.

A New York Times/CBS News poll out today shows a majority of people are opposed to what the governor’s trying to do to unions. But popular or not, it’s fundamental to Walker’s strategy.

Marketplace’s Jeff Tyler reports.

Jeff Tyler: Wisconsin’s budget is a complicated beast, not easily understood by outsiders. So says Todd Berry, president of the Wisconsin Taxpayers Alliance, which researches state and local government.

Todd Berry: Wisconsin doesn’t do government like everyone. The largest single part of our budget — 55, 60 percent of it — is aid to local governments and school districts.

That means big spending cuts at the state level cause big pain at the local level. In the next two-year budget, the state faces a $3.6 billion shortfall. And schools will pay the price.

Berry: Really, school districts have only two options. They can either shave benefits, and therefore hold compensation down. Or if that’s not possible, districts then have to reduce the number of staff. In other words, lay people off.

Governor Walker has proposed restricting public employees’ collective bargaining rights.

Berry: Benefits would no longer be a bargainable issue.

John Peacock is with the Wisconsin Budget Project. He says the governor’s ability to limit collective bargaining is key to plans to reduce spending by more than a billion dollars.

John Peacock: That reduction reflects the fact that local governments — with collective bargaining no longer being a barrier — that they will be able to force local employees to contribute upwards of a billion dollars more for their benefits.

But is it necessary? State workers have already agreed to reduced pension and health care contributions that amount to about an 8 percent cut in compensation.

Peacock: People watching the tumultuous budget battle here in Wisconsin probably infer that Wisconsin probably has one of the worst state deficits, that we have runaway spending and debt, and that we have a bloated public sector. And in fact, none of those things is actually true.

At the same time, it could get harder for local governments to raise money. The governor has proposed caps that would limit the amount school districts can collect from property taxes.

I’m Jeff Tyler for Marketplace.

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