The Debtor Governor
Figures from non-partisan Legislative Fiscal Bureau figures show Walker’s debt level the worst since 1970.
Milwaukee Journal Sentinel reporter Tom Kertscher is a loyal soldier who follows orders and doesn’t rock any boats. In short, he can be counted on to deliver the sort of story his editors expect.
Kertscher recently did a Politifact column which concluded that a statement in an op ed by state Sen. Kathleen Vinehout (D-Alma) about Gov. Scott Walker was only “Half True.” Vinehout declared that state debt has reached “record levels,” as “more money goes to pay off debt in this budget than ever before.”
It is a damaging charge that goes to the heart of Walker’s image as a fiscal conservative who was going to reduce government spending and debt. And everything in Kertscher’s column confirms Vinehout’s view — except for his final conclusion.
Kertscher tells us that Walker issued new debt in order to pay off $558 million in debt payments that were due in 2011 and 2012. “It’s just taking one credit card to pay off another credit card,” says Fiscal Bureau analyst Al Runde. This, in turn, pushed the principal payments some 20 years into the future, which will add another $156 million in interest costs.
As a result, the percentage of general tax dollars going to pay for debt has gone up significantly. Vinehout requested an analysis of this from the Fiscal Bureau, which issued a memo noting that, “Historically, the state’s debt management policy” has kept the debt service on its general obligation bonds “at no more than 4.0%” of annual general tax revenues. “This policy is intended to ensure that debt service does not consume an increasing share of the state budget.”
But under Walker the level of indebtedness has jumped to “5.26% in 2013-14 and 4.88% in 2014-15 based (on) estimated revenues and debt service expenditures,” the memo noted.
No governor, Republican or Democrat, has ever driven borrowing up this high. Going back to 1970, the Fiscal Bureau told Kertscher, the level of indebtedness was always below four percent. Typically the level was below three percent.
But Kertscher decides that Walker shouldn’t get all the blame for this. He notes that Jim Doyle and other past governors “have done long-term borrowing that is still being repaid. In other words, much of the debt, and debt payments, were inherited by Walker from previous governors.”
Exactly. Every governor inherits debt. Yet even though Doyle inherited debt and also restructured debt himself, the state never went above the four percent level of indebtedness. That’s because Doyle always made sure to pay enough debt back to keep the level below four percent.
During his eight years in office, Fiscal Bureau figures show, Doyle “restructured” or added debt of about $96 million per year in debt, compared to $140 million a year under Walker. That 46 percent jump in the rate of restructuring debt is what caused the level of indebtedness to exceed the four percent ceiling every other governor has maintained.
Walker had a choice here and choose a higher rate of debt than any previous governor. Yet Kertscher decides all the past governors should also be faulted for Walker’s decision.
By that line of reasoning, it would be difficult to hold any governor responsible for any decision on his/her watch. It seems a strange thing to do in a Politifact column, where the sole purpose is to decide the facts.
But Kertscher goes even further out on a limb, chastising Vinehout for putting all the blame on Walker for the current level of indebtedness. But Kertscher can offer no direct quote from Vinehout actually saying this.
In fact, Vinehout’s column noted that “In the depths of the recession, Gov. Jim Doyle delayed debt payments to gain cash and keep government going.” But Walker, she notes, “did not pay an even larger amount of debt payments coming due.”
That statement is not only completely factual, but remarkably nuanced for a Democrat throwing stones at a Republican.
Vinehout’s point was that it was “a myth” that the state eliminated the debt under Walker, as some have claimed. “This is false. In fact, state debt reaches record levels in the 2013-15 budget,” she wrote.
Once again, her statement is completely factual. Yet Kerstcher and the Journal Sentinel distort what she said in order to turn Vinehout into the issue, in the process obscuring the truth about Governor Walker — that he hadn’t eliminated or even lowered the debt level but had pushed it to an all-time high.
This distortion will be of great help to Walker when his opponent claims he is first governor in history to push the debt level this high. Walker can quickly blast this as factually inaccurate, as determined by the Politifact column of the state’s largest newspaper.