Good for Wisconsin, Good for America

A panel of scientists performed a survey of all the scientists in the world to see what they believed was the greatest invention of all time. They got answers like the laser, the computer, the rocket. When they asked one of the lesser scientists, he replied: the thermos. He explained that when you put something cold in it, it stays cold, and when you put something hot in it, it stays hot … to which the panel replied: “So?” He answered with a quizzical smirk: “How does it know?”


An obvious question. Here’s another one: What is it about the policies of Romney and Ryan that will help America? America has endured a prolonged recession that has resisted all the economic, political, and rhetorical mitigations applied by the current president. Essentially, the 2008 election has put the economy in an Obamanomics thermos that has kept it cold. Why?

The primary rationale for the Obama presidency’s behavior has been based on redistribution of wealth and Keynesian economic policies. This is no secret. What is also no secret is that the president promised an awful lot when he ran for election in 2008. He really thought that dumping money into government and pet industries and delivering rhetoric designed to create equality of result would somehow — by the force of his sincerity — fix the economy. But the economy has responded to this laboratory of economic and social divisiveness experimentation with — well, it hasn’t responded. Essentially, when you put something cold in the president’s economy, it stays cold. It may get chillier.

On the other hand, I live in Wisconsin, an economy governed by a different set of principles. I have seen firsthand over the last several years how business-friendly policies and tax incentives coupled with fiscal sanity with public spending policies — and a determination not to let hysterical rhetoric and unhinged protests deter the plan — actually expanded the economy.

While actual job growth in Wisconsin is gaining but still dampened by the national malaise, balancing the budget, reducing unnecessary business regulations, providing business tax incentives, and holding taxes steady have caused the state’s economy to expand even under the constraining effects of the national economic failure.


During the governor’s recall election, whether Governor Walker’s policies had created jobs or lost jobs was the key issue cutting right to the heart of whether the reforms were working, and whether he would survive the recall. One measure, the Local Area Unemployment Statistics based on the Current Population Survey, said that 21,570 (rounded up to 21,600) more Wisconsinites were working in March 2012 than in March 2011. Another measure, the Establishment Survey, claimed there were 30,000 fewer jobs in March 2012 than in March 2011. Wisconsin Department of Revenue Chief Economist (John Koskinen) addressed the disparity: his presentation clarified and settled the political debate — WI had indeed gained jobs. It also established that Walker’s reforms may have a much larger impact, namely an answer to the question “What about the policies of Romney and Ryan will help America?”

From Koskinen’s proof:

In part, because Walker’s reforms repealed the “millionaires’ tax” and “combined-reporting” (instituted by the Democrats when they had total control of state government in 2009), and provided business tax incentives — general-purpose revenue increased by an adjusted 4.3% for the first 10 months of FY2012 from FY2011. That includes an adjusted 4.5% increase (7.8% unadjusted) in individual income taxes, a 4.8% increase in sales taxes, and 5.4% in corporate taxes.

Reforms aimed at economic expansion resulted in increased revenue? Who knew? Understand that this result is supposed to have been impossible according to President Obama. He claimed “it never worked.” And by the way, Wisconsin is now the only state in the country that has a fully funded public pension system.


These results give a powerful real-life model for determining what works and what does not work. To the extent that Romney and Ryan will pursue many of the same fiscal and tax policies as Wisconsin, the nation will respond in a similar way.

“How does it know?” is of course an answerable question in the thermos example, and it is answerable and demonstrable in the economy question. The answer is the essence of the coming election in November, and the recall chaos in Wisconsin should give those who investigate it a practical example.


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