Republicans play chicken with the economy at both the state and national levels

As Erik Gunn reports this week, Congressional Republicans’ threat to force the federal government into a first-ever debt default unless they get agreement on a package of draconian last-minute spending cuts could have dire consequences for Wisconsin veterans and for clean energy companies — along with many other citizens. 

The new Republican majority in the House wants to relitigate decisions that were made in the last term, reopening debate on whether or not to pay for measures Congress already passed now that the bill has come due. That’s not fiscally conservative, it’s reckless. And it risks the full faith and credit of the entire U.S. government, with repercussions for interest rates, the stock market, individual workers and families and the whole global economy. In exchange for avoiding a disastrous default, the conditions House Republicans want to impose include cutting all discretionary spending by 22% across the board. 

Those cuts would take a big toll on Americans’ quality of life. As Wisconsin Democratic Rep. Mark Pocan, who sits on the House Appropriations Committee, put it on C-SPAN’s Washington Journal this week, “they can’t even put the ridiculous level of cuts that they proposed on paper, and because of that, they have to have this parallel track to negotiate to kind of, bluntly, save embarrassment.”

There is no good economic reason for Republicans’ insistence on austerity. The country can afford to meet its obligations, and President Joe Biden’s expansive view of government’s role in fighting poverty, rebuilding infrastructure and expanding access to health care and education is better long-term policy than exacerbating inequality by giving tax cuts to the very rich while pulling up the ladder of opportunity for the majority of Americans.

The same principles apply in Wisconsin, where Baylor Spears has been following the twists and turns of state budget negotiations in the Capitol. Republicans have been busy throwing away Gov. Tony Evers’ plan to spend some of the state’s historic nearly $7 billion budget surplus to ease the financial strain on local communities.  

Instead of following the normal negotiation process, the Republicans are trashing the governor’s comprehensive, thoughtful budget document, created with input from citizens and experts around the state, and bringing up their own bills one at a time that borrow Evers’ ideas — but, in the case of shared revenue, cut spending and tack on toxic rightwing policy mandates. That way, they figure they can take all the credit. Plus, Evers can’t use his powerful line-item veto pen to make changes to their bills, since they are not technically appropriations, and therefore must be signed or vetoed in their entirety. 

It’s a petty political game that could have massive consequences for ordinary Wisconsinites. 

And the Republicans can’t even get the petty politics right. Assembly Speaker Robin Vos held a grandstanding press conference Wednesday to announce a “bipartisan” deal on shared revenue after excluding Democrats from the negotiations. It turns out Vos didn’t even have members of his own party on board. Senate Majority Leader Devin LeMahieu held his own press conference Thursday to say the Senate won’t take up the Assembly bill as amended and that he didn’t approve of Vos declaring the whole process over.

“There are two houses in the state Legislature and it’s unfortunate that he’s drawing a line in the sand now, with his version of the bill, and stopping negotiations on a bill that not everybody’s in agreement on,” LeMahieu said, adding that he sees no future in the requirement that Milwaukee be forced to go to referendum to meet its pension payments. All of the Assembly Democrats agreed with LeMahieu. So did Evers. 

Evers’ spokesperson Britt Cudaback released a statement saying Evers agrees and “appreciates Majority Leader LeMahieu’s willingness to keep working together and looks forward to continuing negotiations toward making significant investments in local communities across our state.”

So much for Vos’ “bipartisan” deal, which received not a single Democratic vote. Having met with the governor and made slight adjustments to the original GOP plan, he apparently felt he could impose his will on the state, including a long list of insulting restrictions on local control in Milwaukee (which didn’t have any representation during the “negotiations” among Republican caucus members). Among those requirements is one prohibiting Milwaukee from using taxpayer money to fund diversity, equity and inclusion initiatives, another measure forcing cops back into schools over local officials’ objections and, most dangerously, a provision taking away elected leaders’ authority to raise taxes to cover pension obligations.

Now it’s back to Square One with the GOP version of shared revenue.

In Wisconsin, as in the nation, none of the austerity measures pushed by Republicans are necessary. The economy is strong, unemployment is low, tax collections are up.

For no good reason, Milwaukee, which will host the Republican National Convention next summer, is facing bankruptcy because of a manufactured crisis. And our whole country is on the brink of default because Republicans in Congress are holding up what should be a routine pass-through procedure to try to extract punishing conditions.

The shared revenue debate is a microcosm of the political crisis gripping our whole country as Republicans struggle to hold onto minority rule by suppressing the votes of young urbanites and people of color while driving disaffected white voters to the polls by stirring up racism and resentment. Wisconsin Republicans have been obsessed for years with punishing Milwaukee — the most diverse city in the state. Keeping turnout low among Black and Hispanic voters in Milwaukee was an explicit political strategy in the 2022 election.

That same contemptuous attitude helped shape the shared revenue package Vos touted on the Capitol steps this week — especially the ban on local diversity, equity and inclusion initiatives and the forced return of police to schools. Every community with fewer than 110,000 residents got a 15% shared revenue increase in the plan. Milwaukee, by far the state’s largest city with more than half a million residents, got 10%.

Vos also emphasized a provision that requires communities to increase spending on police, saying that the state won’t send money to cities that “defund the police.” But as Dan Shafer of Recombobulation Area points out, Vos and the Republicans are the ones who have actually been defunding police departments across the state, forcing hundreds of municipalities in Wisconsin to cut police budgets because of declining state aid to local governments.

Nor is Milwaukee a welfare client of the state as Republicans like to assert. 

Milwaukee County is now sending at least $500 million more each year to the state than it did in 2009, according to data on the county board of supervisors’ website. Yet shared revenue sent back to Milwaukee by the state has been declining during the same period, leaving Milwaukee in perilous financial shape, unable to access the tax dollars its own residents are paying to maintain basic services.

The city of Milwaukee is in a particularly lousy situation, since it has no sales tax and is unusually dependent on state aid compared to other cities. A study of Midwestern cities by the nonpartisan Wisconsin Policy Forum found that this puts Milwaukee in a uniquely vulnerable situation, and that “some change should be considered to give the city more control of its own financial destiny.”

That’s pretty much the opposite of Vos’ plan, dangling money but imposing conditions that remove local control, which one Milwaukee legislator described as negotiating while “holding a gun to our head.”

On the bright side, it’s fascinating to see Vos’ power challenged by another leader of his own party. And it’s heartening, in the middle of this game of chicken, to see LeMahieu grabbing the wheel.

When the Senate comes up with its version of the shared revenue plan and sends it back to the Assembly, will Vos scuttle the deal just to show he can? Will the fractured Republican caucus actually come up with something Evers can sign? Or will there be an outbreak of real bipartisanship, in which Republican leaders reshuffle their coalition and court Democrats’ votes to try to get something done? That last possibility would be the most dramatic change. 

After more than a decade of gerrymandering that locked in Republican control, Republicans are confronting the possibility that the state Supreme Court could redraw the voting map within the next year, forcing them to compete on a level playing field. Their tentative gestures toward consulting with Democrats could be seen as a step toward a more functional form of government — one that actually includes debate and participation by the representatives of the people who are directly affected by policy. Don’t hold your breath for any big breakthroughs, though. Giving up power is hard.

But change is coming. We can’t just let the Republicans drive us off the cliff.



originally published at https%3A%2F%2Fwisconsinexaminer.com%2F2023%2F05%2F19%2Frepublicans-play-chicken-with-the-economy-at-both-the-state-and-national-levels%2F by Ruth Conniff

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