With upwards of twenty five thousand protesters in and around the state capitol in Madison and Democratic state senators in an undisclosed location, Wisconsin has become the political story of the week. It has also become a mirror onto our national debate about how to best combat our fiscal woes. As we consider how to best combat the worst fiscal situation in generations, it is worthwhile to step back and think about how budgeting actually gets done.
Budgets, whether they be national or state, have thousands of moving parts. These programs, and the revenues that fund them, reach every part of society. At the same time, these budgets reflect a collection of specific choices on the part of the politicians that create them. Some of these choices are more costly than others; some affect more people than others; some are harder to change than others.
However, it should be remembered that very rarely are particular choices the only ones that can be made. Entitlement programs and debt interest must be funded but discretionary funding and revenue measures are able to be altered. In Governor Scott Walker’s remarks over the past week, he has repeatedly argued that while his proposal to require increased benefits contributions by state employees is “modest,” it is also necessary. While we can debate about the issue of modesty the fact is that it is not, strictly speaking, necessary. It, like all of the other myriad components of this bill, reflects a choice on the part of the Governor. This is especially true of the plan to eliminate collective bargaining rights for these workers.
If the fiscal state of affairs is as bleak as Governor Walker says it is, then he should not limit himself to only a small number of tools with which to combat it. A budget, especially one created in such dire fiscal and economic circumstances, should be a practical and pragmatic document, not an ideological one.
This tendency to make budget decisions based on ideology is best seen when one looks at the revenue side of the equation. What Governor Walker and national Republicans (with an assist from President Obama) have decided to do in taking tax increases off the table, is make it much harder to actually fix their respective budgetary problems. They have made the mathematics more difficult than it needs to be. In fact, their recent actions have made the fiscal situation worse. Whether it be the decision to extend the Bush era tax cuts or, in the case of Wisconsin, to pass a series of tax breaks just prior to this week, these politicians have made ideology, not sound budgeting, their guiding principle.
A consequence of this is that the resulting budgets, whenever they come, will be viewed as less legitimate by large segments of the electorate. When trying to combat the most dire fiscal crisis in recent memory the goal of all politicians should be, above all, to fix the problem and in doing so create as much buy-in as possible. Everyone must have “skin in the game.” For the states and the country at large to move forward with these changes, it is crucial that they be viewed as legitimate. In order for this to happen, budgetary pain should be inflicted across the entire population. Ironically, then, the best budget produced during a time of austerity is one that that everyone dislikes. The key is that everyone dislike it equally.
While House Republicans in Washington have spent the past week working toward a continuing resolution that will keep the federal government open, the reality is that their decisions—and those that will follow when next year’s budget follows on its heels--will have to be reconciled with those of a much differently constituted Senate and White House. As with all “grand bargains” like it, the necessity of compromise will dictate the final product. Prior to the events of this week, the politics of Wisconsin state government did not seem to require such bi-partisan bargaining. For all we know at this point, the politics still might not—but they should.
Whenever Wisconsin Democratic Senators decide to return to Madison, they will still be outnumbered. What they will find is a state that has been rocked to its foundation in ways not seen in recent memory. One hopes that the result of this week is a realization on the part of all parties that in order for the state to move, as its flag says, “Forward,” it must do so with a budget that is practical, fair, and which places everything on the table. That’s always been the “Wisconsin Way.”