Act 10 Savings

Public Policy

Happy Anniversary

11 Feb , 2016  

Five years ago today, Governor Scott Walker began what I refer to as the Conservative Surge in Wisconsin. He introduced a budget repair bill that became known as Act10. It contained some of the provisions I laid out months before.

Repealing collective bargaining rights for government unions may seem a tall order, but not when you consider history.  The concept of collective bargaining by public employee unions is not some century-old part of Wisconsin’s foundation. We became a state in 1848.  The State of Wisconsin did not enact a collective bargaining law until 1959, led by then-Governor and later liberal U.S. Senator Gaylord Nelson…

Herein lies the problem with public employee unions: They determine the fate of their own bosses who in turn have dominion over their compensation. Public employee unions skew the labor-management equation through their political muscle and the fact that their contracts are approved by the very same politicians for whom they vote. Therefore, they have the power to perpetuate and accentuate their own wage and benefit structures at the expense of the taxpaying public.

Building painters in school districts with annual compensation packages of more than $98,000 and bus drivers making six figure salaries that translate into benefit-rich pensions are part of the driving force in the budget problems facing Wisconsin.

Unfunded and underfunded pension and retiree health care liabilities are ticking time bombs at every level of government.

Wisconsin’s state budget doubles the trouble. As a matter of public policy Wisconsin lawmakers have chosen to fund a great deal of local governments’ and schools’ budgets as a means of controlling property taxes. Yet, as school boards and local government employers lack the tools and the will to control wages and benefits, these expenses skyrocket.

Since enactment of the law in March of 2011, Wisconsin taxpayers have saved more than 5 billion dollars. My friends at the MacIver Institute have the details.

$5.24 billion in savings works out to $910 in savings for every man, woman and child in Wisconsin, or $2,291 for every household in Wisconsin. The DOT could build 2,912 more roundabouts. The savings could fund over 68,000 four-year degrees at UW-Madison, or install 42 separate Milwaukee-style streetcar systems throughout the entire state. Thankfully, however, Walker and the legislature have used the Act 10 savings to provide more than $2 billion in direct tax relief for Wisconsinites.

But what’s even more significant than the total is the distribution of savings. Units of government that saved big in the wake of Act 10 range from the smallest villages and townships to the largest agencies in state government. On its own, the UW System saved $527 million in retirement costs alone. “That’s an incredible statement about the success of Act 10,” Healy said.

The MacIver Institute’s analysis found that over 493 different units of government in Wisconsin have saved over $1 million since 2011. Over 100 different units of government have saved over $6 million and almost 20 units have saved more than $20 million since 2011.

I conveyed my thoughts on the matter in a series of tweets earlier.

So, Happy Anniversary, everyone.

But the work is not done yet!

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