Thank You, Candidates

On behalf of the Oshkosh League of Women Voters, the Oshkosh Public Library and the Oshkosh Community News Network, I thank you for taking part in this online debate.

Over the last six weeks, we have posed 10 questions and published your answers. As of today, more than 1,600 unique visitors have come to the site.

These statistics strongly suggest that there is great potential in using the Web log format to further our political discourse and encourage civic engagement.

The sponsors greatly appreciate your willingness to be part of this experiment in using the Internet to strengthen our democracy.

Question #10 Response: Gordon Hintz

The State of Wisconsin, after several years of overspending and tax refunds, faced a $3.2 billion deficit at the beginning of the 2003-2005 biennium. Painful cuts in services, use of one-time only money, and some budget gimmicks have reduced the structural deficit to approximately $700 million for the 2005-2007 biennium. How should the state deal with this deficit without doing further damage to public services?

Unlike two of my opponents, I have an understandingrecognize that over 75% of the state budget goes to five major areas: K-12 education, medical assistance, shared revenue to municipal government, the University of Wisconsin System, and corrections. These are very important services.

For the short-term, the 2005-2007 biennial budget, I recommend that the state fix part of the deficit, but not all of it. This may include more bonding for projects with a life of more than ten years. The structural deficit was long in the making and it needs to be solved over more than one biennium to avoid major service cuts.

For the longer-term, but starting now, I believe that we should concentrate on the following objectives:

1. Control medical assistance spending by focusing on managing chronic illness cases which account for most of the spending.

2. Bring corrections into line by eliminating overcrowding and moving toward a corrections model like Minnesota with non-incarceration options for non-violent offenders.

3. Emphasize expenditures, particularly in higher education, that can have a direct impact on economic growth and therefore more revenue.

4. Revamp the state-local fiscal relationship. Local governments need a more stable source of revenue from the state.

5. Re-examine K-12 educational funding needs to be re-examined. The current funding formula is not equitable.

6. Adopt a longer-term budgeting policy linking expenditures to long-run personal income growth in the state and making proper use of the rainy day fund.

7. Re-examin state tax policy. The state has a more balanced tax structure than many other states, but it is clear that there are questions about the corporate income tax that need to be reviewed.

Question No. 10: Gregg Underheim Response

The term structural deficit refers to the condition of the state budget in the next fiscal year. A structural deficit is the difference between the committed and expected spending and the expected revenues. Small structural deficits have been a common occurrence in Wisconsin.

Recently a much larger structural deficit has accumulated in Wisconsin. It was primarily a function of the downturn in the economy in the year 2000 and the terrorist attacks of September 11, 2001. However, it is also true that during the 1990’s when the economy was very good state government increase spending and provided tax cuts as well. When the economy slowed, those actions also contributed to the structural deficit. At the opening of the last fiscal year the state had a structural deficit of $3.2 Billion. That is a large sum. However, other states faced even larger problems.

In the last state budget the Governor and most of the legislators promised that they would address the problem through cuts rather than through tax increases. We kept that promise. We lowered the structural deficit to around $700 million. And in so doing we improved our tax ranking among the other states because other states addressed their deficit problems by increasing taxes.

When we eliminate the structural deficit this budget we must again do so through restrained spending rather than through tax increases.

Each state has its Big Five or Big Three or Big Six. Those are the major state programs that consume the bulk of the state spending. In Wisconsin the Big Five are K-12 education, Medicaid, Corrections, Shared Revenue, and the University. Those five areas constitute more than 80% of Wisconsin’s spending. To eliminate the $700 million deficit over the next biennium it will be necessary to restrain spending in those areas.

Let me make some suggestions as to how it will be possible to make long-term savings moves in some of those areas.

First, in corrections, it may be possible to save money through alternative programming for non-violent offenders. However, we must make certain that offenders placed in alternative programming are truly non-violent. Being convicted of a non-violent offense is not proof that one has not committed a violent offense. Criminals put into those programs must be carefully screened to make certain they are truly non-violent.

Second, we must begin the inevitable march toward the use of technology as a teaching tool. The computer has revolutionized the world. We make things faster, better, and cheaper than we have ever done before. The computer is the tool that has made that possible. It is beginning to creep into education. In some places students who were disruptive were moved to computer based education programs. They became high performing students. After that success the computer was piloted in traditional classes as a teaching tool. It was successful. Students liked it. Test scores improved. Universities across America have recently been involved in serious research about computer-based instruction in lower level classes, the 100 and maybe 200 level courses. The outcome was very promising. Costs were lowered. Students performed well. Students liked the approach.

In the Medicaid program a large percentage of the costs are due to people with long term chronic illnesses. We manage those patients poorly. All too often they end up going to hospital emergency wards. We can save money by managing their care more effectively. They will receive better care at a lower cost to the taxpayer.

Of course, most everyone who follows politics has read about abuses of the state’s car fleet. We need to sell some of those cars and better manage travel. It is likely that the state would save money by reimbursing state employees for state related travel rather than buying state cars. It is all too often the case that a state car sometimes becomes used for personal purposes. There have certainly been some high profile cases of that recently.

In closing, I’d like to thank the mangers of this blog for the work they have put into this project. Second, I want to ask the citizens of Oshkosh to vote for me on November 2. I have demonstrated that I have courage, that I am not a hard partisan, that I think and act reasonably and in the interest of the public, not special interests. It has been an honor to serve Oshkosh in the Assembly. I hope to be granted that honor again.

Question No. 10: Tony Palmeri Response

Please explain how you think the structural deficit should be fixed. Would you cut any programs to solve the structural budget deficit? Which ones and by how much?

Yes, I would cut some programs to solve the structural budget deficit. I would cut:

*Corrections: In 1987 we were spending $185 million per year on corrections. Today we spend over $1 billion. Minnesota has roughly the same population and spends about $400 million per year. Their crime rate is no higher than ours. By reforming our sentencing guidelines and replacing incarceration with treatment for certain classes of nonviolent offenders, within 5 years we should be able to approach Minnesota’s expenditure level.

*Reduce Highway Construction: We spend about $1.2 billion per year on state highways. Spending on Major Highway Projects doubled between 1988 and 2003. Many of these projects were/are questionable and probably more the result of inside the beltway lobbying and influence peddling rather than any real need for the road. We should scale back the number of road projects, thus producing dramatic savings in this area.

*Government Expenses: We need to move back to a part-time, citizen legislature. Not only would this cut the actual cost of government, but it would replace the current “friends of the lobbyists” we have in the legislature with more “friends of the taxpayer” willing to make tough budget decisions.

Would you raise any taxes or fees to solve the structural budget deficit? Which ones and by how much?

Yes. Any politician who claims we will solve the structural deficit problem only through budget cuts, decimation of the state workforce, and regressive fee hikes (the Doyle/Gard strategy) is being dishonest. This entire campaign I have called for (a.) bringing the corporate income tax back to its 1979 rate, which would bring in $600 million per year; (b.) repealing the single sales factor formula for big business taxation, which will keep $50-$70 million per year in the state budget; (c.) adopting “combined reporting” for corporate taxation which will prevent tax sheltering schemes and bring in millions of dollars of uncollected taxes each year; (d.) auditing all corporate welfare programs and maintaining only those that actually have produced living wage jobs and the recipient of the welfare has committed to staying in the state for at least 20 years. Finally, I would raise the individual income tax rate for those making more than $200,000 per year. The current rate is 6.7% for almost all taxpayers. From 1972-1985 the top rate was 11.5%. We need to return to that rate for people making over $200,000.

Some will argue that my plan for corporate tax fairness will result in businesses leaving the state. This is a BIG LIE that is sheer nonsense. Businesses are looking for a high quality workforce and quality infrastructure. If they were looking for the lowest possible tax burden, they would all move to the deep south. In order to prevent the further “Mississipification” of Wisconsin, we need to act now to create tax fairness.

Please tell us about any other ideas you have for addressing this issue. Please explain how much of an impact on the structural deficit these ideas would have.

We need to have democracy in our budget deliberations. The governor, speaker Gard, majority leader Fitzgerald and the Joint Finance Committee (the only elected officials that have any real say over the budget) must be forced to have ALL budget deliberations in open session. OUR OPEN MEETINGS LAW SHOULD ALLOW NO EXCEPTIONS. Every time they go into closed session, they come out with more schemes to balance the budget on the backs of the middle class and poor while leaving corporate tax breaks and loopholes in place. Democracy can only have a positive impact on reducing the structural deficit as it will force all budget ideas to be heard.

We need comprehensive campaign finance reform. Without it, we will continue to have governors and legislators who will not balance the budget because they must satisfy the needs of campaign contributors. The Wisconsin Democracy Campaign and Common Cause in Wisconsin have documented extensively the link between campaign cash and bad budget decisions in Wisconsin.

We need to place all future budget surpluses into a rainy day fund. The tax rebate gimmick of several years ago is in part responsible for the mess we are in today. The a rainy day fund will also improve the state's bond rating.

I believe that my ideas for solving the structural deficit, because it is based on a tax fairness model, would actually result in tax decreases for the majority of Wisconsin residents.

Question No. 10: Dan Carpenter Response

First, the 700 million dollar deficit we now face is much better than the 3.2 billion dollar deficit we faced previously. That doesn’t mean that we’re quite there yet, but Rome wasn’t built in a day. The one thing I will not do is raise taxes on the already overburdened middle class public.

To deal with the deficit we have to begin un-doing the acts of the Democrats and Republicans that got us to this point. I don’t mean we need to merely reduce the increase in taxes, but we must begin to eliminate the programs that were created to appease special interest groups that have been paying for the campaigns of our legislators. There has been much discussion during this campaign about reducing government red tape to improve development of jobs in this state. What we need to do is concentrate on the programs that are not essential to its operation. Governor Doyle has ordered 10% cuts across the board to help reduce the deficit, but let’s go further and eliminate unnecessary agencies that are not essential.

Specifically, we need to audit all departments such as was recently done with the UW System. While there may be some disagreement about who is an administrator and who is not, it is clear that we need to re-align our priorities. The recent audit of the state-owned automobiles revealed a tremendous amount of waste and abuse of the system.

We need to continue this pattern and ferret out all waste and abuse of the system that has been created by Republicans and Democrats who, year after year, have continued to vote for a budget that is way out of line with what taxpayers can afford.

Throughout this campaign Tony Palmeri has hammered home the idea that we have to stop freeloading corporations operating in this State. He is absolutely right. When we spend our money at a local bank or chain department store there is no reason that the money we spend should be transferred to out-of-state corporate offices and little or no taxes are being collected by the State of Wisconsin. Let’s close these loopholes and increase revenue from those who can most easily afford it. This hasn’t been done in the past because lawmakers are afraid of offending the goose that lays the golden egg for them. That is why I have refused to accept or even seek any funds for my campaign from public, private or corporate PACs.

I mentioned previously that the budget deficit has been reduced drastically. That has been done to a great extent by the veto pen of Governor Doyle. He needs to continue to use that pen and we need to stop the nuisance challenges from people like John Gard and his partisan legion. I would support efforts to reduce the budget deficit through veto and refuse to be intimidated by either party into supporting legislation that is unnecessary and destructive to our State budget. The only way to do that is by electing independent- thinking candidates like myself to go to Madison and fight for the people of the 54th District and the State of Wisconsin.

No. 10: The $700 Million Question

On July 28, the Legislative Fiscal Bureau sent a memo (PDF) to Sen. Michael Ellis (R-Neenah) on the condition of the state’s general fund. In that memo, the bureau estimated that the state’s structural deficit is $700 million.

In other words, the state has an ongoing gap of that amount between what it spends and what it raises. (Some estimates are even higher, but for the purposes of this debate, we’ll stick with $700 million.)

In the past the state has dealt with the structural deficit in part through one-time funding mechanisms that have provided substantial amounts of money. Aside from such mechanisms, the only ongoing solution will be either to cut spending or raise revenue.

It’s easy to say in general terms how to address the problem. Some would say increase taxes, and others would say make government more efficient. Voters in the 54th District deserve to know your specific approach. As they say, the devil is in the details.

It may be too much to ask any single legislator to solve the budget problem, but citizens should know what your plan is and how close it will come to solving the problem.

Please explain how you think the structural deficit should be fixed.

Would you cut any programs to solve the structural budget deficit? Which ones and by how much?

Would you raise any taxes or fees to solve the structural budget deficit? Which ones and by how much?

Please tell us about any other ideas you have for addressing this issue. Please explain how much of an impact on the structural deficit these ideas would have.

Question No. 9: Gregg Underheim Response

Gregg Underheim did not respond to this question by the deadline. His position, described in an e-mail received Oct. 22, appears as a comment below.

Question No. 9: Gordon Hintz Response

Gordon Hintz did not respond to this question by the deadline.

Question No. 9: Tony Palmeri Response

Do you support a user fee/toll system to pay for the reconstruction of the Marquette Interchange and the freeway system in southeast Wisconsin?

No. A user fee/toll system is a regressive form of taxation.

The Marquette Interchange reconstruction is an $810 million project. Our representatives in Washington must obtain as much federal support for the project as possible.

Additionally, the legislature needs to act on the results of a 2002 audit of the Department of Transportation’s Major Highway Projects program. The audit found a pattern of excessive cost overruns (sometimes up to 262%) and a lack of fiscal restraint. In other words, money that could be used to support projects like the Marquette Interchange reconstruction is simply being wasted.

Are there ways to bring down the costs of road construction and maintenance in the state?

Yes. First, we should follow the model of other states and incorporate “value engineering” practices. Transportation watchdogs claim that such practices can save over $350 million per year.

Second, we should eliminate gas tax indexing, a discgraceful form of taxation without representation that allows the legislature to collect an ever increasing amount of transportation money that is used to support questionable highway projects. If the politicians have to vote on tax increases (which is their ethical responsibility), they are less likely to waste money.

Third, the governor should appoint a blue ribbon commission charged with planning a 21st century alternative transportation model for Wisconsin (light rail, biker-friendly policies, etc.).

Fourth, we need to eliminate the current Transportation Projects Commission (currently includes the governor, three citizens appointed by the governor, 10 members of the legislature and the DOT secretary as a nonvoting member) and replace it with an elected Citizen Oversight Board (COB). An elected Board would be much less likely to be composed of “insiders” with some an interest in pet road building projects.

Do you think local governments can do a better job of stretching the available funds?

In 2002 Wisconsin spent 47% of its transportation budget on just 11% of its roadways. Half the budget is spent on 12,000 miles of state highways while the remaining half (according to the Legislative Audit Bureau) is allocated to 98,000 miles of local roads and highways, the State Patrol, the Department of Motor Vehicles, 71 public transportation systems, railroads, airports, harbors, bike paths, transportation services for people with disabilities and the elderly, and other items.

Local governments in general are doing the best they can with the limited resources available to them. It is the state government that is not a good steward of funds, whether we are talking about transportation or any other item.

What local governments must do is participate more actively in “smart growth” policies that deemphasize sprawl and thus reduce the need for ever expanding construction of new roads.

Question No. 9: Dan Carpenter Response

The budget for transportation is high in Wisconsin, there is no doubt about that. However, the reasons for the cost are somewhat obvious. First, Wisconsin is a northern state where frost and salt take a heavy toll each year. Already, that is going to put us far ahead of southern states. As I have driven the highways over the years I can’t help but notice how quickly nice smooth roads deteriorate into washboards. Unfortunately, that is one of the problems with our climate.

Second, we are a more populous state than, for example, Wyoming. We have more people and more industry and, therefore, require a larger system of roads. It just makes sense that these factors are going to put us in the upper range of expenditures for roads among all the states in the country.

I would hate to see us go to a toll system to fund road projects. We desperately need a solution to improve the “death trap” at the 41/21 exchange and the Butte Des Morts Bridge but I would not want to stop at a tollbooth every time I want to cross. If a toll system were limited to the large freeways around Milwaukee or Madison I might find that a possibility.

I think there is always room for efficiency in any area of government. However, I see our transportation system like the foundation of a house. If it is neglected and crumbles, the house eventually collapses into a hole. We all depend upon our system of roads in one way or another. Whether we use them to get to work or to get groceries to our local supermarket, we all need a good system of roads. There has been much talk about jobs during this campaign. Industry cannot thrive in an environment without a good transportation system.

Local government can always do a better job of stretching available funds. Having been a public servant for 34 years I have seen waste over and over. There is no doubt that this waste can be cut. In order for that to happen, we must all become more vigilant and active in local government affairs. Let’s get up off the couch and attend budget hearings and express our opinions about how our money is spent.

Question No. 9: Transportation

In an article published Jan. 21, 2002, the Milwaukee Journal Sentinel (registration required) reported that Wisconsin spends one-third more than the national average on highways. The Wisconsin Policy Research Institute said in a 2003 report (PDF) that the amount was more like 40 percent higher than the national average.

Meanwhile the usual sources to fund transportation projects are falling way short in addressing the transportation needs of the State.

Do you support a user fee/toll system to pay for the reconstruction of the Marquette Interchange and the freeway system in southeast Wisconsin?

Are there ways to bring down the costs of road construction and maintenance in the state?

Do you think local governments can do a better job of stretching the available funds?

Please explain your answers.