Governor Scott Walker gave his first State of the State Address last night at the dawn of what will go down in history as an epic blizzard that paralyzed much of Wisconsin. Although forecasted conditions compelled Governor Walker to declare a State of Emergency, it didn't stop Walker from telling business leaders that Wisconsin is open for business.
Just moments after Walker took office, he called a special session in the State Legislature to focus on job creation. The following day Walker pushed Senators and Representatives to introduce legislation in an effort to improve Wisconsin's economic environment. Following the same pattern of economic fervor - in just three weeks of majority control mind you - Republicans have introduced eight bills encouraging job creation and job retention. Their legislative exuberance sent a message to employers that Wisconsin businesses can start hiring again.
Without getting into the more insipid details of the State of the State Address, the Governor's economic agenda included reducing taxes on small businesses, eliminating the tax on health savings accounts, protecting companies from frivolous lawsuits, expanding tax credits for out-state businesses that come to Wisconsin, and downscaling the amount of rules, regulations, and government mandates that restrain and shrink job creation. People may differ on economic philosophy, but nobody can say that this Administration isn't about getting Wisconsin back on the road to recovery.
In one of the more visible actions of resolution, Walker laid out a welcoming mat for Illinois businesses shortly after Democrat Governor Pat Quinn codified a massive hike on individual and corporate income taxes. Quinn raised the individual income tax by 66% and increased the corporate tax rate by 30%. Their initial proposal - which was shot down - intended to raise the income and corporate taxes by 75% and 49% respectively. According to the Chief Economist Kail Padgitt at the Tax Foundation, Illinois just became a less attractive place to invest. Their tax increase will discourage new investment and business development positioning their state in a competitive disadvantage with neighboring states like Wisconsin.
Because Wisconsin's last Governor raided segregated funds and borrowed beyond our means, it makes Governor Walker's budgeting medicine that much more difficult to swallow. But budget austerity is just one slice of the economic pie. Governor Walker will also make sure that state employees share in the sacrifices so often - and almost exclusively - endured by the private sector.
This includes requiring state employees to contribute just over 5% toward their pension plans and contribute 12% to their health care premiums. Both contributions are considered to be on par with the national average and would save Wisconsin taxpayers more than $30 million over three months.
Governor Walker's State of the State Address indicates a strong economic platform. This is not to say that Republicans will not introduce non-economic bills like Voter ID or conceal carry. The first year of Walker's Administration may be remembered as a year of rightsizing government and creating a structurally sound state budget.
Two particular parts of the GOP agenda that were not addressed in the State of the State Address were Voter ID and School Choice reform. Voter ID, from some preliminary indications, will be introduced and passed in time for the April elections. Voter ID is absolutely necessary to protect the integrity of the ballot system of which our democracy depends.
The other part is School Choice reform, which due to the large cost savings associated with expanding the program, will likely be a budgetary item. Any other changes to School Choice beyond the budget will need to be resolved later by more legislation. Governor Walker must take the lead on School Choice by expanding the program beyond the limits of Milwaukee. Evidence from the University of Minnesota show that kids that participated in the Milwaukee Parental Choice Program had an 18% higher graduation rate than kids that went to MPS.
The conclusions we can draw from Walker's Address is that Wisconsin is in recovery mode. Economic restoration comes in steps that include creating jobs, lowering the unemployment rate, and making Wisconsin a place where people want to do business. Introducing eight bills in three weeks tells businesses - both here and beyond - that this governor is serious about economic liberty and prosperity.