Gov.-elect Walker makes bold jobs promise (UPDATE)
MADISON, Wis. (AP) — Wisconsin Gov.-elect Scott Walker knew people would take note when he guaranteed 250,000 jobs would be created in his four years in office.
Unlike other Republicans candidates who campaigned this fall on vague promises of turning around the economy and putting people back to work, Walker put out a specific number that allows for no fudging, and that portrayed him as a man with a plan.
The pledge was a winner politically. “These are tremendous stakes,” said Wisconsin Democratic Party spokesman Graeme Zielinski. “This is his reason for being. If he doesn’t fulfill his promise, he will be a one-term governor.”
But as Walker prepares to take office and face the challenge of backing up his words, those measuring the state’s economy say hitting the target might not be as difficult as some think. And succeeding might depend less on specific new policies than on national and global economic forces already at work.
“Any government or any governor has limited impact on employment growth, but that doesn’t mean zero,” said Andrew Reschovsky, a professor of applied economics at the University of Wisconsin-Madison. “Influence on the margin is possible. It’s easy to oversell what you can do.”
The state’s economy, which slid badly in recent years, already is recovering, if slowly.
After the recession began in late 2008, Wisconsin lost about 180,000 jobs, hitting a low point about a year ago. Since then, the economy has been slowly climbing back, adding about 30,000 jobs.
The state’s Department of Revenue estimates the state will see job growth across most sectors, including construction, manufacturing, white collar professional jobs and even in government according to the current trajectory.
The department projects adding 190,000 jobs over the next four years without any policy changes. Another, more optimistic forecast by the head of a University of Wisconsin policy think tank says a normal recovery could produce more than 250,000 jobs.
“It’s not an outrageous number at all,” said Joel Rogers, director of the Center on Wisconsin Strategy at the University of Wisconsin-Madison. A normal recovery should bring increases of 5,000 and 6,000 jobs a month, he said, amounting to 240,000 to 288,000 jobs over the next four years.
Walker insists he can create more jobs with his policies. He promises to cut and simplify taxes and ease regulations that will make businesses in Wisconsin more willing to expand and businesses elsewhere more willing to move in. He says his administration will be actively recruiting new economic opportunities.
“I want my cabinet secretaries to have branded across their heads, ’250,000 jobs,’” Walker said at a recent meeting of the Dairy Business Association. “I want them to know their job is on the line because my job is on the line to create 250,000 jobs in the private sector.”
Mark Schug, a professor emeritus at the University of Wisconsin-Milwaukee who works as a national consultant on economic education and urban education policy, said states that have weathered the recession well are those with a less restrictive regulatory environment and a more favorable tax climate.
“Clearly if Wisconsin wants to be welcoming of business, it does have to straighten out its regulatory climate and tax climate to be more welcoming,” Schug said.
Scott Niederjohn, an economics professor at Lakeland College in Sheboygan, said businesses need “a consistent message from state government. This doesn’t always mean siding with Republicans but it does mean a predictable business environment,” he said in an e-mail.
During Gov. Tommy Thompson’s first term, when the state added roughly 250,000 jobs between 1987 and 1991, he focused on holding down taxes, Schug said. Thompson focused on holding down taxes and promoting the state as a good place to do business, Schug said, similar approaches Walker seems eager to take.
But the impact of policies advocated by Walker and other new Republican governors and legislatures is still unproven. A 2008 analysis by the Congressional Budget Office concluded that increasing the after-tax income of businesses usually did not produce an incentive for them to hire more workers or produce more. Business tax cuts pushed through by Republican Gov. Arnold Schwarzenegger in California two years ago have not yet led to clear job gains in that state.
Already, early moves by Walker have eliminated the source of some possible job gains.
His opposition to a high-speed rail line connecting Madison and Milwaukee prompted the federal government to withdraw money. The project was expected to create 5,500 construction jobs. Talgo Inc. moved to Milwaukee with the hope of hiring 125 people to build trains for the new Wisconsin line and others. Now the company is scaling back its plans.
Walker has also talked about eliminating thousands of state government jobs to save money.
Art Boyd, a 50-year-old Milwaukee man who has been looking for work since he was laid off in 2008, said he lost out on a job at Talgo, and is confused by Walker’s approach.
“Before he’s even been seated he has taken away the jobs which our community needed a great deal,” Boyd said. “That’s just ludicrous.”
He said he hopes one of the new jobs Walker promises to create will come his way. “I’m barely making ends meet,” Boyd said. “I haven’t paid any of my bills this week. I don’t know what tomorrow is going to bring.”
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