Whitewater, and many other public schools, this spring find themselves cutting local budgets, and reducing employment to do so. Neither state reductions to collective bargaining nor successful local spending referenda in Whitewater and other communities were able to offset the need for subsequent cuts.
A few remarks on policy and politics:
1. The Center Fails Again. When Democrats controlled state government, Republicans were sure that it was wrong to regulate all the state from the capitol building; now that the GOP runs state government, they’ve forgotten their former opposition to central control, and it’s Democrats who have embraced that line of criticism.
Part of the rationale for restrictions in union benefits for public school employees was to create a new equilibrium in which reductions in bargaining power imposed throughout Wisconsin from Madison would assure that local districts would find a new status quo of reduced compensation in exchange for stable employee rosters.
It hasn’t happened; a plan so sweeping and general never will.
2. State Spending is Still High, but Redistributed. It’s not true that state government is spending less – state government is spending more than ever, but on different priorities. Consider our current state budget:
New figures from the state’s Legislative Fiscal Bureau (LFB) show that the 2013-15 budget approved by the Joint Committee on Finance (JCF) would spend $4 billion (6.2%) more than was authorized in the 2011-13 state budget. Since final spending figures for 2012-13 are not in yet, we compare the proposed state budget to 2011-12 and 2012-13 amounts authorized two years ago. The JCF budget proposes to spend $68.3 billion in 2013-15 compared to $66.1 billion during 2011-13.
Those are huge sums, greater even than the previous biennial budget – spending’s up, and simply redistributed to different priorities.
Update, 12:50, to be clear: Wisconsin’s not out of money – changes from the last state administration to this one are redistributions among options. The real question: on what will any given state administration spend taxpayer revenue (schools, roads, tax reduction, etc., and in which proportions to other items)?
3. Disequilibrium is the New Normal. These fiscal conditions will persist for years to come, in which there will be continual gaps between revenue and expenses. In fact, the claim that Wisconsin has solved a problem of structural budget deficits (a budgetary shortfall that persists for multiple budgets) is overly optimistic:
Finally, LFB figures show the JCF budget would mark the return of structural imbalances—but on a smaller scale than for budgets approved during 1995-2011. During those years, first-year structural imbalances ranged from $589 million to $1.3 billion. The 2011-13 budget created a structural surplus heading into this budget. However, if the JCF budget is approved, lawmakers would face a $202 million first-year imbalance heading into the 2015-17 biennium.
4. The Politics of It All. There’s gain in showing that districts are willing to take steps to balance budgets without additional debt-spending.
There’s a risk in this, however, for any organization that commits to regular staff reductions to make budget (just as there would be to regular program cuts, building closures, etc.): people are naturally wary of organizations or companies that seem in disarray or decline.
That’s the damned-if-you-do, damned-if-you-don’t dilemma for district officials: neither frequent use of debt measures nor frequent staff cuts are reassuring. (One recourse or the other is bound to upset some significant number of residents.)
We’re a society that expects growth, and quick rebounds from bad times – it’s why the sluggish recovery has been so unsettling to so many.
In these conditions, the best posture toward the community is not one of confident declarations, nor of discussions of cuts alone, but of a repeated discussion of programs and fiscal cuts, together. (See, on this point, Lead Substantively, Support Fiscally.)
This should be a combined discussion repeated so often that no one expects any other approach: here’s what we’re doing programmatically day-in, day-out, here’s what we’re reducing by necessity, here’s why we’re reducing, here’s what those reductions mean.
It’s neither good policy nor good politics to separate ongoing work (many continuing programs) from costs or expense reductions in these topics – bifurcated discussions will prove a mistake, working a cumulative erosion of a community’s confidence.
One should expect, really, these fiscal conditions – and discussions about them – to persist in Wisconsin, for years to come.