Business climate up; major issues ducked

Governor Scott Walker

Governor Scott Walker

In terms of the pressing strategic issues of the state, it’s hard to know what to make of the Walker administration and last two GOP-controlled legislatures.

On the big issues — health care costs, university governance and organization, job creation and acceleration of the startup economy, poverty and crime in our major cities, collaboration on the use of our natural resources in tandem with advancements in the economy — all have been given only passing attention by Gov. Walker and GOP legislative leaders.

No doubt, they have improved the business climate, mainly through tort reform, common sense regulations and reductions in tax rates.

But, if you go looking for a game plan over the last four years when the GOP was in complete control in Madison, it would be more on the political side of life in our fair state.
Connect the dots on the big thrusts. Act 10 neutered public unions by taking way bargaining powers and automatic dues collection. Union membership has plummeted. Right-to-work, labeled by Gov. Walker as a distraction in the 2014 campaign, will have an only modest impact on the largely non-union private sector non-union, but will impact unions negatively. The recent push to end costly prevailing union wages in public construction contracts will, if passed, do the same.

Unions, particularly government employee unions, had grown powerful in Wisconsin in alliance with Madison-centric Democratic Party, and a majority of the citizens of the state obviously felt it was time to rebalance the scales of power. Walker and company have accomplished that largely political agenda in spades.

Citizens/voters clearly came to believe that the old adversarial model between unions and management didn’t work in a new era of fierce global competition. Nor does contention over shop rules in high tech workplaces, where innovation and breaking the old rules is the rule.

That said, displacing the unions is not enough to win prosperity for the long term. Economic, education and social strategies need to be blended for a winning game plan in the new day. And, it must be said, state Democrats have not advanced a convincing, competing prosperity strategy either.

High level thinking about those high-level challenges has been attempted twice over the last 15 years. The University of Wisconsin led four economic summits from 2000 to 2003, and Competitive Wisconsin Inc. led two statewide exercises on the economy and education in 2010 and 2012.

A few of their recommendations have made headway, but largely without leadership and resources from the state’s political leaders. It came clear in those exercises, for example, that the economy works in clusters, such as papermaking, finance/insurance, information systems, advanced manufacturing, agri-business, business services and health care But clusters as an organizing concept has largely been ignored in Madison.

Leadership has come from elsewhere. To wit: education leaders and two CEOs provided the strategic jolt for the freshwater technology cluster in the M7 Region. They got a little help from the state, and UW – Milwaukee won a new College of Freshwater Sciences. But, because the $150-million cuts to the university system are being done across-the-board, rather than strategically, growth at the new UWM college could be stunted.

Further, GOP leaders have muffed an opportunity to reorganize UW System along regional and cluster lines. They proposed an undefined “authority” as a way to cut costs, but not as a way to align university resources with the state’s prosperity agenda.

A high level commission of citizens could figure out what an authority ought to look like to advance state strategy. It could also have dealt with GOP’s concerns over concepts like tenure and shared governance.

In another display of inertia, out-of-control health costs for state employees and Medicaid recipients, which have been the major spoiler for the state budget, have been ducked. The private sector has tackled health cost hyperinflation; not so for at the state level. Hence, the current budget crisis and the crowding out of other priorities.
The startup economy is revving up in Wisconsin, but mainly through leadership from the private sector. There are new support systems for entrepreneurs; new angel and venture monies are available in the state; accelerators like gener8tor and incubators like Ward4 are priming the pump for investment-worthy deals; and university campuses are encouraging students to think of making a job versus taking a job.

State support in Wisconsin has not been entirely absent. We do have the Act 255 credits that de-risk early stage investments by 25%. But other states, regions and nations have fully embraced the strategy of changing the prosperity game through massive investments in technological and innovative startups. No such vision here. Prosperous Israel, about our size, is known as the Startup Nation.

One of the many surprises in the governor’s budget was to gut the Stewardship Fund and the powers of the Natural Resources Board. The legislature may reverse the latter, but the former has demoralized the conservation community. How strategic is that approach to our natural resources?

Why is little attention paid to the huge challenges to Lake Michigan, to the dead zone in the center of Green Bay? These are invaluable economic assets.
GOP leaders did put through a mine permitting bill that added certainty mining ventures, but got sold a bill of goods by Gogebic Taconite and its furtive owner, the Kline Group. It was a strategic embarrassment.

The murder rate is Milwaukee is heading for horrible new highs, but there is virtual silence on pivotal subjects like inner city poverty, joblessness there, unbelievably high birth rates to single mothers — a guaranty of poverty in fatherless households, and the need for funds for more cops on the streets.

Want jobs in the central city? Move some state agencies and UW System headquarters to Milwaukee. Do it ASAP. Madison has jobs going begging. It doesn’t need them like Milwaukee does. Walk the talk.

Wisconsin’s economy has gained ground in the last three years, and some of that lift can be attributed to business leaders feeling a lot better about the positive actions to improve the business climate.

GOP leaders can take a bow on that strategic front. CEO Magazine just ranked the state 12th for business climate, up from 41st four years ago. But middle of the pack on many other rankings isn’t good enough.

It will take a larger vision and executive and legislative action to get to the Top Ten for prosperity among the states.

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  • Tom Ladky

    I will take gladly what we have accomplished with Walker at the helm…..some priority issues remain un attended to, true, but the Dems would be riding us into the ditch if they were still in control on Madison….

    • NewWisGov

      Are you, like Scott Walker often does, trying to blame the huge 2008 national crash on the prior Dem Gov? #WalkerTricks

  • old baldy

    John:

    Please give credit/blame where it is due. Tom Tiffany is the one that sold the state a bill of goods on the GTAC mine. Anyone with half a brain saw from the start that the mine would never move forward because GTAC and the new mining law ignored the role that the feds play in permitting. I;m sure you were aware as well. Now Tiffany has finally admitted he is behind the science cits at DNR. String him up.

  • Doug Swanson

    John, it must be interesting to live in the pollyanna world where you can expect politicians to do the right thing and practice leadership and some amount of common sense. You wonder why some of these things have not received attention as all of the items you outlined should? Politics. And Presidential politics specifically. Every decision made by this governor and for the most part rubber-stamped by the Legislature has been about his lust for higher office. That’s why jobs took a back seat to social issues – the base loves that. That’s why actual job creation took a back seat to increasing business profits – his donors love that. We do not have leaders anymore. Many of the things they’ve done have been about payback and have been petty beyond belief. This state cannot move forward without a thriving middle class, ours is shrinking. The economic model adopted by those that worship Arthur Laffer doesn’t work now and never has.

  • NewWisGov

    Chief Executive magazine gives bonus points for low wages and weak pollution standards. You brag about that ranking even though we haven’t seen progress in the official jobs ranking as we dropped to 40th place. All states have “gained ground” since the huge 2008 crash, but dropping 11th to 40th place for jobs is not deserving of credit.

  • Conservative Spartan

    Gov Walker, Mr Unintimidated;
    1) Where is the Stop Common Core bill you promised for this session?
    2) Why does your budget add 100 new tax collectors and assess them $1.2M ea in new revenues? Doesn’t that disproportionately impact the small to medium businesses you’re trying to attract?
    3) Where is your leadership on prevailing wage?
    4) Where is the RFB for the SBAC replacement test that was promised in late January?
    5) Why aren’t you pressing the university funding cuts?
    6) Will you sign the Kooyenga/Darling school bill?
    7) Considering MacIver Institute’s comments on the waste within the Dept of Trans, what will you do?
    8) Do you regret the collection of DNA upon arrest (not conviction) you added in last budget as an over reach into civil rights?
    9) Since you’ve been gone 50% of the time since the first of the year, and especially in light of the budget negotiations, do you consider the governorship a part time job? Do you think the rule allowing a current office holder to run for another office during their current tenure in the best interest of Wisconsinites?