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Biz Beat: Walker budget plan called a 'nuclear option'

Biz Beat: Walker budget plan called a 'nuclear option'

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WALKER ECONOMIC.jpg
Gov. Scott Walker speaks to crowd at an economic development conference held at the Monona Terrace Convention Center Friday just prior to the announcement of his budget repair bill.

Gov. Scott Walker made no secret about his intentions to take on public employee unions during the campaign.

The Republican governor is keeping his word -- and then some.

"You'd have to have been in a coma" to not realize what was coming, Walker said in unveiling his budget repair bill at a jam-packed Capitol news conference Friday.

But the proposals announced by Walker go well beyond his campaign vow to make participants in the Wisconsin Retirement System contribute toward their pensions or pick up more of their health care costs.

Walker is looking to remove collective bargaining rights except for salary for roughly 175,000 public employees, from school teachers to garbage collectors -- although local police, fire and the state patrol are exempt. Any requests for a salary increase higher than the inflation rate would have to be approved by a referendum.

The bill rolls back the ability of UW System employees to collectively bargain at all, a right granted under former Gov. Jim Doyle. That affects about 6,900 represented employees including teaching assistants and graduate assistants, according to UW spokesman John Lucas. 

The bill also makes union dues optional for state workers; requires an annual vote by union members to maintain certification and eliminates health care or pension benefits for any limited term employees.

Walker several times on Friday said he appreciates the hard work and professionalism of the state's public sector. He said workers here still enjoy excellent wages and benefits -- although a Cornell University report issued this week said full-time public employees in Wisconsin make 8.2 percent less compared to private-sector workers.

But the governor clearly expects a backlash and says he has even contacted the Wisconsin National Guard about filling in for critical services should state employees launch some kind of job action in protest.

"The fact he's ready to call in the National Guard tells you far the governor has gone," says state Rep. Mark Pocan, D-Madison.

Scot Ross of the progressive Advocacy Group One Wisconsin Now added: "You take away people's rights and then use the National Guard to back it up. If this was happening in another country, we'd call it a Banana Republic."

Even the normally staid state Sen. Fred Risser, D-Madison, the most senior legislator in the country, called it a "dictatorial attack on public employees that borders on abuse."

"The governor's budget adjustment bill attempts to wipe away over 50 years of collective bargaining rights in Wisconsin," said Risser. "This decree will affect every hard-working public employee in the state; every librarian, teacher, street department worker and public safety worker."

Walker is looking for fast action from the Republican-controlled Legislature on the bill, which includes other items such as refinancing state debt. The state is facing a $137 million shortfall in the current fiscal year and a $3.6 billion hole in the next biennium.

The changes in public worker pension and benefits would save the state an estimated $30 million immediately and $300 million over the next two-year budget cycle.

State Sen. Jon Erpenbach (D-Waunakee) says the governor has gone with a "nuclear option" in an effort to save $30 million over the next few months rather than looking for other more creative ways to save.

But Walker said the moves avoid the need for any layoffs or additional furloughs.

He added that the changes will save enough money to prevent the removal of more than 200,000 children from the Medicaid program and up to 6,000 state employee layoffs.

"The last thing we need are more people out of work," Walker said, adding that he will not call for any layoffs or furloughs in his two-year budget to be announced later this month.

Still, union leaders were clearly taken aback by the scope of the proposed changes.

Former State Sen. Joe Wineke, a past labor negotiator under Doyle, called Walker's plan the first step toward making Wisconsin a "right-to-work" state. Right-to-work laws exist in 22 states, mainly in the South and West, and prohibit making union membership a condition of employment.

"Walker has basically created a right-to-work state for public employees," says Wineke.

The head of the Wisconsin AFL-CIO also rapped the plan.

"The right to negotiate both wages and benefits through a union is a fundamental underpinning of our middle class," President Phil Neuenfeldt said in a statement. "Instead of balancing the budget on the backs of hard-working Wisconsinites, we need to come up with a balanced approach that looks at shared sacrifice from everyone."

Local police, fire and the state patrol would be exempt from the changes, Walker said, because they have historically enjoyed more lucrative benefits because of the nature of their work -- although critics noted that police unions backed the governor in the last election.

The measure does include making some modifications to the more lucrative pensions for elected officials and political appointees. Legislators and their staff would also come under the increased pension and health care contribution proposals.

The governor's proposal did enjoy some support from the state's largest business lobby. Wisconsin Manufacturers & Commerce in a statement called the changes "modest and consistent with changes made at private business."

"These proposed changes will allow government at all levels to better manage costs, increase efficiency and ultimately improve the quality of government services. In the long run they will make government more affordable and provide long overdue relief to taxpayers," the group said.

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