For our state’s economy to work for everyone, Wisconsin needs to invest in healthy communities, working families and public infrastructure across the entire state. We also need a tax system that provides a level playing field for Wisconsin families and businesses, rather than a structure that gives an advantage to the well connected who rig the system for their own benefit.
The budget that Gov. Tony Evers has proposed would move Wisconsin closer to the goal of a better, more equitable economy that would work for everyone. His budget would give a major boost to Wisconsin’s public K-12 schools, one of the most important assets our state has. He wants to increase access to health care and invest in maternal and infant health. His budget tackles longstanding racial disparities that are among the worst in the country, and that hold Wisconsin back. He pays for all of this by closing loopholes that benefit the wealthy and powerful, taking full advantage of federal resources, and using short-term savings from the last budget.
Some of the highlights of Evers’ budget include:
- A $1.6 billion increase in state support for public schools over the course of the two-year budget period, which runs through June 2023. In addition to providing flexible support that schools can use in a variety of ways to help students excel, the governor tailors resources to identified special education and mental health needs. He also wants to limit the amount of public money that goes to private schools.
- A major expansion of access to health care and insurance coverage by BadgerCare. This move would add health insurance coverage for 91,000 adults with low incomes, and save the state more than $600 million over two years by accepting federal money for health care that our Legislature has so far turned down.
- Reshaping the tax code by reining in wasteful tax breaks for the rich, such as an exemption that lets manufacturers get away with paying next to nothing in income taxes. He also wants to tax investment income earned by high-income Wisconsinites at the same rate as income earned from a paycheck. His budget redirects some of those resources and makes the tax code more equitable by increasing an income tax credit for working parents with low incomes, and increasing a property tax credit that helps people with low incomes afford to stay in their homes.
- Help for parents to access high-quality, affordable child care, especially if they live in areas where child care is hard to find.
These investments and others proposed in Evers’ budget would help Wisconsin families and communities thrive. But his budget faces a hostile environment in the Wisconsin Legislature. Some conservative lawmakers have denounced the governor’s budget as “fiscally irresponsible,” which is ironic given that the Legislature is refusing to accept hundreds of millions of dollars in federal resources that would help Wisconsin residents see a doctor when needed. Republican lawmakers have also specifically opposed Evers’ proposal to close tax loopholes, even though a whopping 84% of the tax increases would come from taxpayers with incomes over $1 million. In fact, it’s the Legislature that is being a poor steward of state tax dollars, by turning down outside resources and propping up a tax system that requires people with low and moderate incomes to pay more than their fair share to support public services.
The Legislature and the governor have to work out some form of agreement about the state budget for the next two years. But when it comes to federal COVID aid coming into the state, current state law gives the governor sole authority to decide how to invest that money. The American Rescue Plan directs resources to individuals, schools, local governments and state governments that will help put the country on the best possible path for a strong and equitable recovery. As part of the American Rescue Plan, the State of Wisconsin is slated to get $3.2 billion through the end of 2024 that we can use for a wide variety of purposes, including giving aid to households, businesses, and industries; making investments in broadband, sewer, and clean water; and providing premium pay to public workers who have put their lives on the line during the pandemic to maintain critical infrastructure operations. Local governments in Wisconsin will get an additional $2 billion over this period and public schools will get $1.5 billion.
Evers has said he wants to use federal COVID aid to the state to support businesses, underwrite the state’s pandemic response effort, upgrade broadband infrastructure, and promote tourism. Republican state legislators have very different ideas for how to spend this money and introduced 11 bills that outline their priorities, which Evers vetoed, as expected. . According to the Legislature’s own advisory agency, several of the bills likely violated federal rules for using the money. It’s worth noting that the American Rescue Plan includes an additional billion dollars for Wisconsin if we expand BadgerCare, on top of the $600 million of state savings already included in Evers’ budget. This raises the tab for the Legislature’s ideologically driven refusal to expand BadgerCare to a staggering $2 million a day over the next two years.
The financial decisions made by the governor and the Legislature during this critical time will have long-lasting effects. We shouldn’t — and in fact we can’t — try to rebuild Wisconsin’s economy back the way it was before the pandemic. To do so would be to buy back into a system purposefully designed to systematically marginalize people of color and enrich only a few. Instead, we should use this budget and the federal COVID aid to enact substantive change with the goal of constructing a new, more equitable economy. The changes Evers is proposing would help Wisconsin take a significant step towards that goal.