Taxing Progressively

Wisconsin Wake-Up: ‘Fight like an Egyptian’

Wisconsin’s capitol continues to reverberate with the sound and fury of workers and students united — against the ‘Mubarak of the Midwest’ and the wealthy he so diligently shields from any inconvenience.

By Sam Pizzigati

In 1911, exactly a century ago, Wisconsin enacted America’s first state income tax, a tax-the-rich move initially proposed, a few years earlier, by the state’s innovative progressive Republican governor, Robert La Follette.

Now another Wisconsin Republican governor is trying to make history — in the opposite direction. The newly elected Scott Walker isn’t just demanding pay and benefit givebacks from the state’s public employees. He’s pushing labor law changes that would, if enacted, essentially drive their unions out of business.

Hourly wage increasesBut Wisconsin workers are trying to make some history, too. They mobilized last week, in record numbers, to stop Walker’s plan.

Day after day, tens of thousands of protesting Wisconsans surrounded the state capitol building in Madison. On Thursday, inside that capitol, the governor’s Senate allies couldn’t round up enough votes for a quorum. The governor’s rush to gut union rights had fallen strikingly short.

But last week’s stunning success, protestors understand, represents only round one. They’re gearing up for a protracted struggle against what one Wisconsin union activist, Carmen Clark, is calling the “owning class.” 

And Wisconsin workers are hoping, along with their retired and young student supporters, that this struggle will prove a game-changer — for the nation.

“Unless we begin acting to recover our democracy from the plutocracy now in control,” as retiree Dave Svetlik put it last week, “the ‘American dream’ will continue to drift ever further from the reach of average citizens.”

That drift will become a powerful push if Wisconsin’s new governor ever gets his way. Some 20 states now have GOP governors and GOP-majority legislatures poised to follow the Scott Walker script.

Walker the gubernatorial candidate kept that script secret from Wisconsin voters in his election campaign last fall. He ran — and won — as a candidate pledging to work, on a bipartisan basis, to create jobs.

But a week ago Friday Walker unveiled a budget package that went far beyond anything he had ever hinted at during his campaign. Walker proposed to double what public employees pay for health care and hike their required pension payouts as well. The impact? The governor’s plan would cost one typical public employee family, teachers Brad and Heather Lutes, over $8,000 a year.

Wisconsin public employees, as one new study notes, already take home 8.2 percent less annually than private-sector workers with comparable educations.

The budget package Walker unveiled earlier this month also asks lawmakers to strip away basic workplace bargaining rights. Under his plan, public employee unions in Wisconsin would no longer be able to bargain over health coverage, pensions, or any other benefits.

Unions would still be able to bargain over wages, but wage increases, the governor’s plan stipulates, would not be allowed to inch up over inflation. Unions would also not be allowed to collect operating expenses via dues checkoff. On top of that, the governor’s plan would force them to run workplace elections each and every year to continue to be recognized as an employee bargaining agent.

In other words, notes University of Wisconsin historian Stephen Meyer, Walker’s plan “requires that unions get certified by their members yearly, at the same time that the unions are prevented from accomplishing anything for their members.”

Governor Walker claims that his state’s budget crisis leaves him no choice. Wisconsin, to be sure, is currently facing a budget shortfall — $137 million this year and $3.6 billion over the next two.

But stripping unions of bargaining rights Wisconsin public employees have held for half a century — ever since their state became the nation’s first to enact a state public employee bargaining law in 1959 — will do nothing to narrow the state’s budget deficit. And the governor refuses to consider other steps that would — like raising taxes on Wisconsin taxpayers who make over $200,000 a year.

The state top rate on income over that figure currently sits at 7.75 percent, a rate down substantially from the 11.4 percent Wisconsin top rate in effect throughout the 1970s. A hike in that 7.75 percent top rate to 10.95 percent — on income over $200,000 — would raise about $600 million a year.

The public employee wage and benefit cuts the governor is pushing, by contrast, will save only $30 million this year and $300 million in the next two combined.

signupIs a 10.95 percent top rate politically possible? Minnesota governor Mark Dayton thinks it is. Last week Dayton proposed just this rate for his state’s top-income bracket, plus an additional temporary surcharge on income over $500,000 and a new state property tax on homes valued over $1 million.

Dayton’s tax hikes on Minnesota’s wealthiest 5 percent will raise enough revenue to cut in half the state’s $6.2 billion budget shortfall over the next two years.

Unlike Wisconsin’s Walker, Minnesota’s Dayton clearly signaled his intentions to voters. In his campaign last fall, he ran on an aggressive tax-the-rich platform.

Walker, since taking office last month, has pandered to the rich. Once sworn in, he pushed into place $140 million in tax breaks that almost exclusively benefit the rich and corporations. The ultimate irony: These tax breaks for Wisconsin’s affluent created the $137 million deficit in this year’s budget that Walker is using to justify his demand for cutbacks in what Wisconsin public workers take home.

Governor Walker, as protestor Kathy Wilkes reminded one rally in Madison Tuesday, ought to be “talking about the corporate elite and their gargantuan salaries.” Instead, he’s “demonizing workers.”

“We did not create the economic crisis and we are not going to pay for it,” college faculty organizer Bryan Pfeifer told that same rally. “Fight like an Egyptian!”

Sam Pizzigati edits Too Much, the online weekly on excess and inequality published by the Washington, D.C.-based Institute for Policy Studies. Read the current issue or sign up to receive Too Much in your email inbox.

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