Bruce Murphy
Murphy’s Law

Can Burke Beat Walker?

The 2014 campaign may depend on which candidate has the best story to tell.

By - Nov 26th, 2013 12:19 pm
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The 2014 election for governor is less than one year from now. That’s sooner than you might think. By this spring we may begin to see a narrative for the election established. And often times it’s the best story that wins.

Mary Burke

Mary Burke

Mary Burke, widely assumed to be the likely Democratic candidate for governor, has barely begun to tell a story. She may face a primary challenge from state Sen. Kathleen Vinehout (D-Alma) and is being cagey about how much she says to the press.

By contrast, Gov. Scott Walker has already begun rehearsing the story of his upcoming campaign. He was “Unintimidated,” as his book’s title declares, he stood up to special interests who run the unions and were driving up the costs of government. He cut spending, balanced the budget and cut taxes. He made this a more business-friendly state and greatly lowered unemployment, helping us recover from the bad old days under former Gov. Jim Doyle.

Some of this, of course, is not quite true. Walker did make significant cuts in spending but the overall state budget has grown by 8 percent, increasing the biennial budget to $67.6 billion, or about $4.6 billion higher than the final, $63 billion budget under Doyle. As for balancing the budget, the state deficit has declined somewhat, from $2.99 billion to $2.64 billion, but it’s still one of the biggest structural deficits in the country, as I’ve previously reported. Meanwhile, Walker has pushed the state’s bonded indebtedness to the highest level in history. Finally, as Bruce Thompson’s analysis has shown, most of the decline in Wisconsin’s unemployment rate actually occurred under Doyle.

But Walker won’t be defeated because there are some holes, no matter how large, in his story. He will have unlimited campaign money to hammer his message and he’s a very good campaigner. The Democratic candidate will have no chance without a strong counter-narrative.

As it happens there is such a story to be found just next door, in neighboring Minnesota, a state with many similarities to Wisconsin. As political science professor Lawrence R. Jacobs of the University of Minnesota wrote in an op ed for the New York Times, the two states allow for a interesting measurement of conservative versus liberal polices, because Minnesota elected a Democratic governor, Mark Dayton in 2010.

While Walker lowered income taxes, delivering 60 percent of the tax cut to those making more than $100,000 a year, Dayton and the Minnesota legislature raised taxes by $2.1 billion, “the largest increase in recent state history,” Jacobs notes. “Democrats…targeted the top 1 percent of earners to pay 62 percent of the new taxes,” almost the exact reverse of what Walker did.

Walker also reduced the earned income tax credit for the working poor and the Homestead Tax Credit for low income homeowners and renters — money that would likely be spent immediately on consumer purchases and help increase business sales. Dayton took the money from the top 1 percent of the wealthiest people, who are unlikely to change their retail spending as a result.

The results to date show Wisconsin hasn’t grown jobs much and now ranks 34th among the states in job growth. Minnesota, by contrast, ranks fifth. Forbes magazine ranks Minnesota as the eighth best state for business, while Wisconsin ranks 41st.

In Minnesota, Dayton invested 71 percent of the new revenue in funding for K-12 schools and higher education as well as all-day kindergarten and pre-school education. Walker’s budget included the seventh-sharpest decline in education funding in the nation.

Walker declined the additional federal funding for Medicaid, even though the federal government covered all costs for three years. He also declined to create a state insurance exchange under Obamacare. Dayton and Minnesota created a state insurance exchange which enrolled more than 90 percent of its first month’s target, Jacobs notes, and this contributed to a medical care system that has much lower premiums for the insured than in Wisconsin.

Walker has been very adroit politically, blasting the problems of the federal website for Obamacare. But a savvy Democrat might say this: as governor I would have solved the problem rather than blaming others. I would have created a successful health care exchange like in Minnesota and California and today we would have far more health care coverage and lower average premiums for our citizens.

This is also where Walker’s presidential aspirations are relevant. Walker has refused to guarantee that he will finish out a second term as governor, and may have to step down if he wants to concentrate on the 2016 presidential race. That’s a theoretical issue that might have no impact in the governor’s race — unless the Democratic candidate shows its real world impact.

A long list of Republican governors accepted the additional federal funding for Medicaid. Walker refused, which gives him bragging rights as the most conservative Republican in the 2016 presidential primary. But it meanwhile leaves more than 84,000 Wisconsin citizens without health insurance that they could have had for three years.

If I were the Democratic candidate, I would look for every way to relate Walker’s policies to his run for president. Most people in this state, I suspect, favor the earned income tax credit. Indeed, the measure was created in 1989 by Republicans in Wisconsin as a way to support work, not welfare. But for the conservatives who vote in a Republican primary — and whose votes Walker needs — anything that cuts taxes will look good.

Similarly, I would argue that a governor concerned with the long-term health of the state would not drive its bonded indebtedness to the highest level in history. That’s the policy of a governor who doesn’t intend to stay in office very long. And while slashing education spending may have no short-term impact, it will in the long run, as classes get bigger and school resources are stretched, but the impact on student achievement will come long after Walker has moved on to a run for president.

You might also argue that a governor who was less concerned with making his name nationally would have accepted the deal offered by Democrats and union leaders — to cut the health insurance and pension benefits of government workers — instead of crushing union rights and plunging this state into a state of interminable political war. Indeed, former Republican governor Tommy Thompson clearly favored a less-radical approach. A good leader knows how to compromise, but a candidate with his eye on the Republican presidential primary has different priorities.

Burke is frankly a long shot as candidate. Her resume is thin, and while she has personal wealth it’s still not clear how much of it she is willing to spend. Vinehout is even a longer shot. But either potential candidate will need a strong story to tell — or she won’t have a chance.

Short Take

The Milwaukee Journal Sentinel embarrassed itself again with a Politifact column. Once again it was written by Tom Kertscher, who seems to be the go-to guy for Politifact columns slanted to help Republicans.

He quotes Mary Burke who says this: “I’m concerned that the state budget has actually grown by $4.6 billion under this administration, which makes it harder and harder to keep taxes lower.” To test this, Kertscher, contacts the non-partisan Legislative Fiscal Bureau, which says the budget has increased by $4.67 billion. In short, Burke’s comment is factual.

Kertscher, however, proceeds to stand on his head to turn this fact into something else. He quotes Walker’s press secretary Tom Evenson blaming the situation on a rise in the cost of Medicaid and on past commitments made by former governor Doyle. Therefore, Kertscher rates Burke’s statement as “half true.”

Kertscher makes this conclusion based on a Republican response with no rejoinder by Democrats, which immediately tilts the scale. And he violates the time-honored maxim that a governor or president is responsible for what happens on his/her watch. Walker has had no problem whatsoever canceling other commitments of Doyle. He is in the driver’s seat as governor.

Kerstcher’s column turns Politifact into Politi-Interpretation. The original premise of the column — a good one — is to establish agreed-upon facts. The fact is that the budget increased under Walker by exactly the amount Burke said. When the candidates argue about why that is so, that might call for another Politifact. But for now, Burke’s statement isn’t half true, it’s dead right.

Categories: Murphy's Law, Politics

31 thoughts on “Murphy’s Law: Can Burke Beat Walker?”

  1. Nate says:

    Budget numbers should be billions not millions.

  2. Dave Reid says:

    @Nate Thanks… We’ve made the correction.

  3. Tyrell Track Master says:

    I”m a little worried about the goon squad ranting about how Trek sent some production to China… it’s amazing, but that largely irrelevant fact could easily skunk 5-10% of the vote away from Burke.

  4. Mike Bark says:

    It depends on whether or not she can continue to dodge where she stands on the big issues. Would she raise taxes? Would she repeal Act 10? Of not, how is she any different then Scott Walker.

    I also think she might have a little Lance Armstrong problem. Trek took a huge leap when they had him endorsing their products. The Company does not come across well in the new Armstrong book and their behavior with Greg LeMond was shameful. The outsourcing stuff may hurt in a primary, but I think the Armstrong stuff will play a role.

  5. George Mitchell says:

    Table 6 of the August 1, 2014 Legislative Fiscal Bureau report on structural deficits shows:

    1. The state’s structural deficit of $2.5 billion was eliminated in Walker’s first budget.
    2. The projected structural deficit for the upcoming state budget is $545 million.

    Bruce uses GAAP criteria for calculating the structural deficit but does not explain to readers that this method is not comparable to the criteria used and reported for nearly two decades by the Fiscal Bureau and the Wisconsin Taxpayers Alliance. Apples and oranges.

  6. Bruce Murphy says:

    George, the figures came from the Wisconsin Taxpayer’s Alliance, not from me, and have been previously reported.

  7. Andy says:

    Bruce, I’m pretty disappointed in this piece. This is just a big shill for Burke, or better description might be just a big sales pitch against walker. And I give you credit for many of your pieces lately being open to at least acknowledging opposing views… but this one is over the top biased.

    84,000 people losing healthcare? You know there’s more to the story, that those people are eligible for obamacare and would still get coverage (in fact better coverage in many cases) and in return there were a slew of people slated to join badgercare that never could before, especially low income people with no children.

    And that’s just one example. You know the state doesn’t go by (although I would LOVE them to start) GAAP accounting. It would be great if we did, and I support politicians that support it, but you can’t just eliminate GAAP deficits over night, and the WI taxpayers alliance has different assumptions on revenues then the state which gives us the increasing deficit projection.

    I’m willing to conceded (in fact I write my representatives about this) that the state is spending too much on Hwy construction and the like. Why can’t you do the same and admit to other viewpoints? Or even if you disagree and remain as blatantly biased as you have, at least mention the points and give counterpoints and let readers decide what to support.

  8. bruce murphy says:

    Andy, the Taxpayer’s Alliance always looks at GAAP accounting and its analysis of that deficit under Doyle was a campaign issue for Walker. As noted, Walker reduced it, but not much.

    The 84,000 people are likely to get much worse care, because the state won’t get the additional Medicaid subsidy.

    This column is not intended as a final summary of Walker’s tenure but as an analysis of how the Democratic campaign might be run. I still think the chances of defeating Walker are pretty slim.

  9. George Mitchell says:

    It is highly misleading to introduce GAAP numbers without providing context as to the methods historically used by WTA and the Fiscal Bureau to estimate the structural deficit. The fact that you got the GAAP numbers from WTA is irrelevant. Here’s what an accurate report would have said: “Based on measures of the structural deficit traditionally used by the Wisconsin Taxpayers Alliance and the Legislative Fiscal Bureau, an estimated $3 billion deficit was eliminated in Walker’s first biennial budget. Following the second Walker budget the projected structural deficit now is about $500 billion. Under a different measure (Generally Accepted Accounting Principles), the deficit was reduced from……”

    Bruce’s article fails to address the enormous improvement in local fiscal conditions as a direct result of ACT 10. Districts such as MPS were on an unsustainable financial path. Independent research by leading scholars illustrates that Walker and the Legislature have, through Act 10, given school districts and municipalities a huge fiscal life line.

  10. bruce murphy says:

    No offense, George, but I’ll go with WTA numbers over yours.

  11. George Mitchell says:

    Dishonest.

    “My numbers” are from the Legislative Fiscal Bureau. WTA has issued very similar numbers over the years. WTA also has issued GAAP numbers.

    All I suggested was context.

    Bruce’s response is a direct and knowing evasion. A good journalist gives readers context.

  12. Bruce Murphy says:

    George, there’s nothing controversial about these numbers. I interviewed Todd Berry, head of the Taxpayer’s Alliance and he went through the GAAP deficit going back through Doyle’s entire time, and the numbers are what I reported back in May:

    http://urbanmilwaukee.com/2013/05/16/murphys-law-the-not-so-fiscally-conservative-governor/

    Walker initially lowered the GAAP deficit from $2.99 billion to 2.06 billion and then gradually increased it to back to $2.64 billion.

    You’re suggesting Walker also improved local conditions/budgets. That’s certainly true and no doubt will be part of his campaign. This column was not meant as an exhaustive run-down of what Walker’s campaign might argue, but an examination of what Burke, who has been pretty quiet up to now, might argue.

    If you feel we’re remiss in not fully reporting Walker’s side of it, may I suggest you write an Op Ed for us. If it’s as spicy as your column suggesting Dan Bice resign, we’ll happily consider it, though I must note, George, Mr. Bice has not stepped down to date.

  13. George Mitchell says:

    So, your readers don’t get to know that the LFB and Todd Berry have often used a different metric to calculate the structural deficit?

    Omitting that information — information that easily could have been provided — fits perfectly the traditional definition of half-truth, i.e., a statement that is narrowly accurate but misleading by virtue of what it omits. I’ve always considered half truths to be the most despicable kind of distortion.

    The wording I suggested above provides useful context to the GAAP data. I don’t question the GAAP data, so Bruce’s repeated citation of it is beside the point. Misleadingly so. Knowingly so.

  14. bruce Murphy says:

    I have gotten WTA newsletters for years. It may be that at some point they changed how they defined a structural deficit though I don’t recall it, but their numbers going to before Doyle became governor used the same way of measuring the deficit for every year. Those are what I reported back in May.

  15. Chris Jacobs says:

    The title of the article almost suggests that something would actually be told about Mary Burke. What makes her worthy of being governor again? What story is she telling? This is kind of like asking if Joe Blow can beat Mike Tyson in a fight, and then citing all of Tyson’s troubles and downfall from grace, ignoring the fact that the opponent is some Joe Blow.

  16. Doug says:

    She can’t raise taxes, she can’t repeal Act 10 so why should she lie and say she will?? It’s amazing to me how many people don’t understand that no matter what happens in the election at least two branches will be controlled by Republicans. Electing a Dem Gov or getting 17 senators is only a stopgap, stop the bleeding remedy.

  17. Chris Jacobs says:

    If she expects to be governor, she really should say something relevant to what benefits she would bring as governor. Electing someone just for party sake doesn’t accomplish anything.

  18. Bruce Thompson says:

    I think that Walker is vulnerable on the jobs issue if Burke runs the right kind of campaign. Since January 2011 Wisconsin jobs (up 3.11%) have grown less than in any of the contiguous states (Illinois 3.14%, Iowa 3.27%, Minnesota 4.60%, Michigan 4.88%) or the US as a whole (5.40%). The Wisconsin unemployment rate (down 1.2 points) has declined less than in Minnesota (2.0 points) or the US (1.8 points).

    I thought, however, that Burke whiffed in kicking off her campaign. Taking a leaf from Walker’s book (he likes to compare Wisconsin results today with the situation at the peak of the recession, rather than when he entered office), by comparing the job situation in Wisconsin now with that when she was Secty of Commerce, before the recession hit.

    I also thought she fumbled by bringing taking credit for Eline, but not primarily because a bit of research would disclose that Uihlein is the kind of businessman who imagines himself as John Galt, even while accepting government subsidies. More seriously, she displayed a belief in the “bribe ’em and they’ll come” theory of economic development.

    But she has time to develop a serious plan for job growth.

  19. Phil B says:

    I went to the New North conference four years in a row. First year, Gov. Doyle was 15 minutes late (screwing up the whole schedule). Next year, half hour late, the next half hour late. Doyle’s way of saying F.U. to business. The last year btw, he was met with virtual silence. Next Year, Scott Walker shows up (early, actually). Spends 45 minutes talking ec.dev with no notes, offering specific references, localizing anecdotes.

    I’m not a big fan of Walker, but the guy really does want to be Governor (if not something more). Mary Burke better get her act together quickly or she’ll seem like a real dilletante on the same stage with him.

    “Best story’ Bruce? Seriously? Milwaukee has been and would be much better served by your cogent and objective reporting than this glossy and insubstantial ‘analysis’. Unless Milwaukee’s hyper-partisan d.a. is also leaking something to you that you’re not sharing. Or maybe they’re just really perverting the d.a. office authority?

  20. Alex says:

    I am interested in why the state’s S&P rating remains at only AA. That’s bottom half if the nation. In the S&P report, they praised Walker taking on the structural deficit but said that increased spending and over-bonding (as Bruce mentioned) are issues. They also mentioned the low job growth, especially lack of any manufacturing growth. It seems like that rating could go up, but that seems like it relates to this column.

  21. George Mitchell says:

    Bruce still doesn’t get it. Below are two of many examples showing methods that WTA (and LFB) have used to describe structural deficits. What remains true is what I said at the outset, namely, based on conventional standards used since the 1990s Walker eliminated the structural deficit and now it is creeping back. It also is true that by another measure — GAAP — the structural deficit is larger and did not decline as much. This is the context Bruce fails to provide, wrongly suggesting instead that WTA only has used GAAP measures.

    http://wistax.org/blog/state-spending-balances-and-structural-deficits

    “Finally, LFB figures show the JCF budget would mark the return of structural imbalances—but on a smaller scale than for budgets approved during 1995-2011. During those years, first-year structural imbalances ranged from $589 million to $1.3 billion. The 2011-13 budget created a structural surplus heading into this budget. However, if the JCF budget is approved, lawmakers would face a $202 million first-year imbalance heading into the 2015-17 biennium.”

    http://www.wisconsinbudgetproject.org/the-other-side-of-the-coin-for-income-tax-cuts-structural-deficit-reopens

    In 2013, the state’s General Fund is projected to have a structural balance of $146 million, which means that revenues were greater than state spending by that amount. But in coming years, state spending is projected to outstrip revenues, creating a structural imbalance that rises to nearly $350 million in 2017, as shown in the chart below. Based on these Department of Administration projections, state lawmakers would need to fill a hole of more than $600 million in the 2015-17 budget. – See more at: http://www.wisconsinbudgetproject.org/the-other-side-of-the-coin-for-income-tax-cuts-structural-deficit-reopens#sthash.8y0Qtg9X.dpuf

  22. Bruce Murphy says:

    Actually, George, it was Scott Walker who used the GAAP deficit figure of $3.6 billion when he ran in 2010 and promised to eliminate it. http://www.politifact.com/wisconsin/statements/2012/jan/29/scott-walker/gov-scott-walker-says-he-eliminated-wisconsins-36-/
    He cited this repeatedly to justify the need for Act 10 and I wrote a column saying there was indeed a deficit of that magnitude. So I’ve been consistent in the standard I’ve used.
    When I interviewed Todd Berry of WixTax he discouraged the use of the “structural deficit” and said the GAAP figure is far more meaningful. And Walker appears to agree.

  23. George Mitchell says:

    Nowhere do I dispute that GAAP is a valid measure. I suggested only that it be described in context.

  24. George Mitchell says:

    BTW, Bruce wrongly says the $3.6b deficit was the GAAP deficit. As the article he links to explains, that was the structural deficit as more traditionally defined and it credit Walker with eliminating it.

    Bruce is correct to point out Walker’s unfulfilled pledge to eliminate the GAAP deficit. Also, of late, Walker himself has mixed apples and oranges by wrongly comparing the structural deficit to year-end cash amounts.

    Dale Kooyenga does a pretty good job here is explaining the differences.

    http://www.jsonline.com/news/opinion/wanted-honesty-in-accounting-cd441gf-139130809.html

    The eyes-glaze-over discussion of state budget deficits and definitions obscures the far larger point: the trajectory of state and local finance fundamentally has changed under Walker. The impact on MPS, for example, is illustrated here

    http://www.edexcellence.net/commentary/education-gadfly-weekly/2013/july-18/governor-scott-walker-public-education-hero.html

    Similar stories can be told, and are quietly being told, in school districts and city halls throughout Wisconsin. School board members, aldermen, mayors, etc. will say off the record that Act 10 has been a huge benefit. The near- and long-term magnitude far surpasses whatever differences exist between GAAP and other deficit definitions.

  25. George Mitchell Should Find a Hobby says:

    George Mitchell: We got your point the first time. Bruce answered it and you’re wrong. Bruce is not misleading the readers by using the numbers as he did. He used the same numbers Walker used in his campaign. That’s fair game. You really should find a more productive hobby my boy.

  26. Bill Sweeney says:

    The most compelling point of Bruce’s article is the comparison between what has happened in the last few years between Wisconsin and Minnesota. Given the well documented increase in inequality over the last 30 or 40 years and the full blast ideological campaign to equate raising taxes with giving away your first born child, it took real courage to raise taxes on the wealthy in Minnesota. Bruce also emphasizes that anyone running against Walker will have to have a powerful narrative to the one that Walker has presented. I for one will be interested in what Kathleen Vinehout has to say. If memory serves, the numbers in Minnesota among Republicans, Democrats and Independents are similar to those of Wisconsin. Walker’s narrative goes against Wisconsin’s progressive traditions. It might be interesting for someone to present an unapologetic argument for a return to those policies and ideas.

  27. tim haering says:

    Bruce, I agree on your summary. Burke and Vinehout are long- and longer-shot. Not sure I agree with WI-MN comparison. MN Is whiter, colder and more urban than us and has more college grads. If Garrison Keillor thinks we’re comparable, I might agree. I recall Dems offering to take union wage and pension cuts only AFTER Act 10 passed. They lost, he called their bad faith bluff – you can’t quit after you’ve been fired. Walker cannot have serious presidential aspirations – a freshman governor with zero national or foreign policy. He’s even less qualified to be president than Obama. Make a fine understudy, though, in the classic Bush 41, Gerry Ford mold.

    And you consider Burke “cagey” with the press? She answered personally and in length an email from Dan BIce? How much more sincerely naïve can you be? She made her first campaign trip up north in October and did not visit the tribes or the mining site. She’s as green a statewide campaigner as Ed Thompson was, rest his merry old soul, and she lacks his abundant people skills. She practically bought her school board seat. That won’t work this time. Maybe her weekend with Dave Obey helped. But I’ll wager he did all the work. It’s apples and oranges, but she’s Mitt Romney.

    Hope you had a fine Thanksgiving.

  28. Tom D says:

    Tim, Walker never asked the unions for wage cuts, and the unions accepted Walker’s benefits cuts BEFORE Act 10 passed.

    http://www.jsonline.com/blogs/news/116502958.html

    While I don’t understand what difference it makes whether Minnesota is “whiter” or colder than Wisconsin, your claim that Minnesota is “whiter” is simply false–the Census Bureau says that 88.2% of Wisconsinites are white vs 86.5% of Minnesotans.

    Minnesota data:
    http://quickfacts.census.gov/qfd/states/27000.html

    Wisconsin data:
    http://quickfacts.census.gov/qfd/states/55000.html

  29. Wisconsin Conservative Digest says:

    Under normal circumstances a Mary Burke candidacy would be a joke, but the left wants to so badly get power back that they will put up anyone except Tom Barrett again.. Normally any GOP or Dem will get 47% and the battle is over the rest.
    Under tommy we gained 750,000 jobs, under Doyle/Burke in 8 years we lost 150,000 jobs, under Scott we have gained 130,000 jobs, what are we debating, not much challenge there.
    The Left wants to pump up the state employees salaries and bennies, they are already far over what the rest of us get so they will do anything to gain power trying to make a silk purse out of Doyle’s record. Under all GOP governors in my lifetime we have progresses, the opposite under the big spending left.
    all we have to do is go back to the 1982 campaign and play the commercials that criticized Kohler for moving jobs out of state, not out of country and the ads that went after Mitt for being in the 15. The left will love that.
    Incidentally, what does raising subsides to the public schools do for the kids??? Nothing. Walker balanced budget and fixed it so that schools did not to have lay off people.
    In the last 40 years we have added money to schools way over the inflation rate, Carter added the Dept of Education which does nothing, we have DPI, also does nothing and then the twin disasters of Race to the Top and NCLB without any improvement. Time to go the opposite way, break up the big districts, get the schools closer to the community and teach kids to read.
    Common Core, another national program is going to be th same disaster the New Math was, so why are we doing the opposite of what the best programs in the world, like Finland, Scandinavia and the Far East? WE never learn.
    Raising Educrat salaries does not teach one kid to read these blogs that Murphy runs. CHOICE does. Raising taxes just pounds more money down ratholes inhabited by government employees.

  30. Bruce Thompson says:

    Dohnal,
    Where did the jobs figures come from?
    Bruce

  31. Steve says:

    In the recall election of 2012 Sen. Vinehout received 4% of the vote. Sec. State. LaFolette received 3%. Vinehout’s candidacy is at worse a farce and at best a waste of democrats money.

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