Walker’s ‘Savings’ Will Cost Taxpayers Millions for the Next 10 Years
More Financial Revelations in Fatally-Flawed Walker Scheme
MADISON, Wis. — In an attempt to push through his unpopular Budget Repair Bill, Gov. Scott Walker has tried to set a Friday deadline for passage by falsely claiming that lack of action will cost taxpayers money:
“If we don’t pass that by this weekend, if we fail to be able to achieve those savings, that opens the door for a large number of layoffs for state workers,” Walker said. [Wisconsin State Journal, 2/22/11]
However, a recent memo by the Legislative Fiscal Bureau illustrates that Gov. Walker’s bond refinancing scheme has nothing to do with saving taxpayers any money. Instead of making a scheduled $165 million debt payment that is due on May 1, Walker wants the state to borrow the money to make the payment by taking out a new 10-year loan for the same amount. The Legislative Fiscal Bureau estimates that the interest costs for taxpayers in just the first two years of the ten-year loan will total $14,010,000 (http://legis.wisconsin.gov/lfb/Misc/2011_02_22WILeg.pdf).
“While Gov. Walker and his administration talk about how his plan will ‘save’ taxpayers money, in reality taxpayers will be paying higher interest costs over the next ten years,” said Scot Ross, One Wisconsin Now Executive Director. “In reality it’s only by defeating this bill that we will save Wisconsin taxpayers money, as well as save important bargaining rights for Wisconsin workers.”
All of this comes after Gov. Walker signed into law $140 million in new special interest spending, and follows his continuing refusal to accept the concessions provided over a week ago by working men and women that more than solves the budget dilemma.
Gov. Walker’s plan also directly contradicts the promises that he made repeatedly during his campaign and since he became Governor to not borrow money to balance the budget:
Soon, we will lay out our plans for the next state budget and we will successfully tackle the three billion dollar deficit. We will do it without raids on segregated funds, or excessive borrowing. [Walker Inaugural Address, 1/3/11]
Our budget repair bill will lay the foundation for a structurally sound budget that doesn’t rely on short-term fixes and other gap measures that only delay the pain and create perilous uncertainty. [Walker State of the State Address, 2/3/11]
We’re going to do the right thing. We’re going to balance the budget the right way. We’re not going to push it off to the next generation. [Walker press conference, 2/21/11]
“While there may be legitimate policy reasons for refinancing the debt, especially in the face of an economic collapse caused by Wall Street greed and George W. Bush’s mismanagement, this isn’t the way to go,” said Ross. “Gov. Walker should be honest with the people that his plan is nothing more than obtaining a new loan. To say that the refinancing ”saves’ taxpayers money is as dishonest as saying that his budget repair bill preserves collective bargaining rights.”