Are Wisconsin's Budget Reforms a Model for Other States? A Conversation with Governor Scott Walker and AEI Scholar Andrew Biggs

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Post-Event Summary

In March 2011, Wisconsin Governor Scott Walker (R) signed into law a bold piece of legislation to address his state's $3.6 billion budget deficit, the Wisconsin Budget Repair Bill. Thursday at AEI, Gov. Walker discussed the four options – raising taxes, laying off public employees, cutting core services and accounting gimmicks – he rejected when determining how to balance the budget. He then emphasized the benefits of his long-term structural reform policies for compensation, pensions and health insurance for public-sector employees. Andrew Biggs, a resident scholar at AEI, praised Walker's reforms. He emphasized that although salaries for public employees in Wisconsin were lower than for private-sector workers with the same skills, benefits significantly increased the total compensation of public employees compared to their private counterparts. Biggs also pointed out that public employees in Wisconsin pay less toward their health insurance than most private-sector employees and pay little or nothing toward their pensions.

Gov. Walker then delved into one of the most contentious aspects of the Budget Repair Bill, stressing that collective bargaining is not a right but an expensive entitlement. In response to a question on the lessons he has learned, Gov. Walker emphasized the importance of getting the message out to the public early and spending adequate time talking to constituents. Despite the contentious response to his reforms, Gov. Walker stated his intention to run a positive campaign during the recall election he expects to face in June.
--Rohan Poojara

Event Description
In March 2011, Wisconsin Governor Scott Walker signed what is now nationally famous legislation designed to balance the budget, make structural reforms to state spending and provide budget flexibility to local governments. As many states have struggled with deficits, laying off public employees and raising taxes, the question is whether Wisconsin's reforms are successful and could be a model for sustainable fiscal discipline.

Gov. Walker will discuss with Andrew Biggs how his plan has impacted Wisconsin's short- and long-term fiscal health, unemployment rate, economic growth, business environment and fiscal health of local governments. He will also talk about how national and state public employee union leaders have opposed Wisconsin's reforms, including their current attempt to recall him.


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