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3/4/2008
Guest Blog: Governor Doyle, cancel your Ireland trip
Update: 3/4/08, 1:30 p.m. Someone was listening. Governor cancels Ireland trip.
Good call Mark. JE
From Mark Rahmlow: Democratic Governor Jim Doyle’s departure for Ireland comes as legislators continue to negotiate a $650 million budget deficit for the current cycle.
A few months ago, Doyle put the budget process on hold while he toured China. And once again, Doyle is signaling he will introduce a fix – but will travel abroad soon thereafter. The legislature is scheduled to meet only a handful of days in the coming months; certainly the month of March presents the best opportunity for the governor to fix a mess created largely by his administration.
It was Sir Winston Churchill who once said:
A politician needs the ability to foretell what is going to happen tomorrow, next week, next month, and next year. And to have the ability afterwards to explain why it didn’t happen.
Even with $3 billion in new taxes, Doyle presented the legislature with a budget that left a $2.4 billion hole in the next biennium using generally accepted accounting principles.
Doyle needs to take responsibility for the current deficit and cancel this trade mission if needed. Anything less would make him derelict in his duties to the people of Wisconsin. The administration will likely say this trade mission has been in the works for a long time. Yes, free trade is important to the success of Wisconsin’s economy. But Doyle’s responsibility is to Wisconsin first - then Ireland, second.
Clearly, the governor is fond of Ireland for its scenic beauty and robust economy. (This will be Doyle’s second trip to the land of Celtic lore.) The governor recently commended New North for following the Irish example and frequently gushes that the Irish spend lots of government money on education as if that alone is responsible for Ireland’s booming economy.
“Ireland continues to be one of the fast growing economies in the EU and is now entering its thirteenth consecutive year of economic growth,” Doyle’s office said in February.
But the Irish example involves far more than exports and increased government spending on education. It was rabidly pro-growth tax policies that led to Ireland’s economic dominance in Europe. And not just targeted tax breaks, either, but low taxes across the board.
Hopefully, Ireland’s political and business leaders remind Doyle of their success as tax slashers. Doyle could better sell Wisconsin to Ireland if the state’s financial house were in order. The governor can tout Grow Wisconsin, but that proposal does little to create the real tax incentives necessary to erase this year’s deficit or the projected GAAP deficit for 2009. The only proposal that actually has a chance of moving the Wisconsin economy forward has been languishing in the Assembly’s Joint Committee on Finance since June.
Invest 2.0, State Sen. Ted Kanavas’ (R-Brookfield) income and capital gains tax cut proposal, has only a few days left to become reality as part of a budget repair bill.
According to the Department of Revenue’s fiscal estimate for Invest 2.0, income taxes would drop $102 million in 2008 and decline another $74 million in 2009. “We all know the income tax is the one most closely associated with economic growth,” comments State Rep. Robin Vos, R-Racine.
Ok, so the governor won’t dare cancel his trade mission. So with six days until the governor leaves, and nine days until the legislature adjourns, both sides better get busy charting a course to balance the budget and lower taxes. Yes, lower taxes that will result in higher revenues - which would then give the governor more money for education. The Irish would be flattered that Wisconsin followed their lead.
And who knows, maybe Wisconsin’s economy will grow for thirteen straight years.
Mark Rahmlow is a former field director for Tim Michels 2004 U.S. Senate campaign.
COMMENTS
Jo,
I agree Doyle (like the legislature) should get the work done before ending the session or going on a trip. However, the author is mistaken when he talks about Ireland's low taxes. Ireland's personal income taxes are some of the highest in the EU. It's the corporate taxes that are lower, relative to the rest of the industrialized world. So, the author takes the position that lowering Income taxes would be linked to increasing economic growth in Wisconsin with Ireland as the example? If Ireland is the example, Wisconsin should drastically raise income taxes and cut corporate taxes to the bone. That would be consistent with the Irish example. Finally, the Irish corporate tax example is not even possible in Wisconsin since the federal taxes on corporate taxes are the big issue. In short, the author is attempting to link Irish national and EU policy to the State of Wisconsin. It is less valid than apple and oranges, it is more like apples and cats.

dave allen (Tue Mar 04 08:14:59 2008)
Dave, as the author of that article I think you missed the important point. I did not say anything about Ireland's income tax. I said Ireland significantly reformed their tax code to attract business. In most cases, that meant lower taxes that helped turn a poverty stricken nation into a dynamic powerhouse.
No one argues Wisconsin's taxes are too high and that jobs are leaving. The two points are directly related to each other. Invest 2.0, Wisconsin's solution to the tax problem, is the best way to grow the economy and jobs. Apples to Apples, my friend.

Mark Rahmlow (Tue Mar 04 13:53:29 2008)
Mark, thanks for the clarification. I was confused because the article and the headline referred to Ireland's tax reform and the state rep. talked about income tax reform (which Ireland didn't really do much of). So, I guess comparing what Ireland did to what Wisconsin could do is not relevant except that they could both have a tax reform attitude? If so, then perhaps there is a better state tax reform model here in the USA where corporate taxes are largely federal responsibility and states can deal only with sales tax, property tax and a little bit of income tax?

dave allen (Tue Mar 04 17:30:27 2008)
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