Embattled Wisconsin Gov. Scott Walker (R) has his tried-and-true talking points — pushing back against public-sector unions and advocating private-sector job growth — as he makes the rounds ahead of a recall election in June. What was unusual Tuesday was where Governor Walker took his message: Illinois.
Walker frequently bashes Illinois, Wisconsin‘s southern neighbor, for its ballooning budget deficit and oversubscribed pension obligations, saying voters need to keep him in office to prevent such fiscal woes from besetting Wisconsin. Speaking at the Conservative Political Action Conference in Washington in February, Walker described Illinois as “no greater example of the failed policies [he’s] running against.”
Walker appeared Tuesday in Springfield, Ill., the state capital, at the invitation of the Illinois Chamber of Commerce, which supports his approach to fiscal reform. His keynote speech was timed to coincide with the start of a new seven-week legislative session, in which Illinois Gov. Pat Quinn (D) and the state’s Democratic majority face a number of troubling economic burdens, including an estimated $8 billion budget deficit this fiscal year.
Walker’s message, says chamber president and CEO Doug Whitley, makes him “someone whom we should be paying attention to” in Illinois.
“Scott Walker represents the bold approach — swallow the castor oil today and you’re going to be better in the long term,” says Mr. Whitley. “In Illinois, we’ve been doing the incremental approach. We’ve been doing right things but haven’t been bold enough to move the needle.”
Illinois raised income taxes last year, but the state Chamber of Commerce complains it did nothing to solve the state’s financial crisis. Instead, Whitley says, Illinois needs to look for solutions in restructuring Medicaid benefits and the state’s five public pension systems to make them more sustainable.
Walker could stand to benefit from his appearance if Illinois business people opt to contribute to his campaign to defeat the recall, but he didn’t rally the Chamber of Commerce audience to financially support his campaign Tuesday.
Governor Quinn did not comment on Walker’s appearance in Springfield, but his office did issue a handout to reporters that was meant to contradict many of Walker’s assertions. It said, for instance, that Wisconsin lost 21,000 jobs last year and, in the first 13 months of Walker’s tenure as governor, ranked last in job growth, citing the US Bureau of Labor Statistics. Walker, for his part, likes to emphasize job growth in the private sector, saying 17,500 such jobs were created in January and February, and noting that Wisconsin’s unemployment rate has been falling.
About 2,000 protesters, primarily representing labor organizations, gathered outside the hotel where Walker spoke Tuesday.
Inviting Walker to Illinois is part of the agenda of business groups “to slash the modest pensions earned by teachers and police and other public employees,” says Anders Lindall, public affairs director for the American Federation of State County and Municipal Employees (AFSCME) Council 31.
Walker is “the spear-carrier of a nationwide attack on the middle class … and on the very idea that government can invest in education, health care, and other priorities that serve everyone in our society,” Mr. Lindall says.
Pension reform is one area in which Walker says he helped to reduce the budget deficit he inherited upon taking office. Under a new law, public-sector employees in Wisconsin pay 5.8 percent to 6.65 percent of their salaries toward pensions, while keeping their current benefits. Before Walker became governor, they paid less than 1 percent.
In Illinois, public-sector employees already contribute as much as 8 percent of their salaries toward their pensions. State employees who contribute to Social Security pay 4 percent.
Illinois’ unfunded pension hole of about $80 billion is the result of at least three decades of state leadership failing to set aside adequate funds for future pensioners, says Jeff Brown, a former economic adviser in the George W. Bush White House and director of the Center for Business and Public Policy at the University of Illinois in Urbana-Champaign. Forcing the burden onto school districts and universities or public workers will erode the state’s ability to recruit and maintain world-class employees, he says. A more realistic solution, he adds, is to spread the burden fairly among all parties.
“You’ve got serious discussions running the gamut from making the workers pay it all to making the employers pay it all to making the state pay it all, which is the current law. My guess is, in the end, we’ll get some convoluted mix of the three,” Mr. Brown says.
In a statement Tuesday, Illinois state Senate President John Cullerton (D) said, facetiously, it was “great” that Walker spoke to corporate leaders in Illinois. He hoped it would emphasize the difference in tax rates between the two states: Illinois’ personal income tax rate is a flat 5 percent, while the income tax rate in Wisconsin is graduated, ranging between 4.6 percent and 7.75 percent depending on how much a household earns.
“He’s helping convince the business community that his system of graduated tax rates is the way to go.… I can’t wait to hear how he’ll help us next,” Senator Cullerton said.
Also on Tuesday, Wisconsin Lt. Gov. Rebecca Kleefisch (R) urged Illinois companies to immigrate to her state, during comments at a tea-party rally in downtown Chicago.
“I’m happy to poach more if Quinn continues to march down the path he’s on right now,” Ms.Kleefisch, who also faces a recall vote June 5, told the Chicago Sun-Times. “It’s all fair in economic development.”