Time to Double Down on Bold Reforms

By Scott Manley
WMC Senior Vice President of Government Relations
The results from the election this year were as historic as they were stunning. Very few people expected Donald Trump to win the presidency, or the State of Wisconsin for that matter.  Voters from across the country sent a clear message that the status quo of big government intervention and job – killing regulations are unacceptable.
Yet in Wisconsin, voters sent a different message — one of affirmation. Voters here gave legislative Republicans even deeper majorities, and a clear directive to continue doing what they have been doing for the past six years: enacting bold, pro-growth reforms.
To put these expanded majorities into perspective, consider the fact that Republicans now have more members in the Senate than they’ve had in the past 46 years. In the Assembly, you need to go back 60 years to find a Republican majority this big. Most members of the Assembly weren’t even born when GOP ranks in that chamber were this large.
The lesson here is that if you do big and bold things, voters will reward you.  Two years ago, we asked the Legislature to enact Right-to-Work to give workers freedom of choice in the workplace and make Wisconsin a more attractive place to invest. Many believed that Wisconsin passing Right-to-Work was politically unthinkable, yet not a single Republican who voted for the new law lost his/her election. Not one.
Republican lawmakers must put their strong majorities to good use and quickly enact bold reforms that help businesses and families prosper. Following are a few priorities that WMC will ask them to consider this year.
Workforce Development
A survey of WMC CEOs last year found that 70% are having trouble hiring, and the labor shortage was the top business concern facing employers. Although there is a shortage of skilled labor that is particularly acute in the STEM fields, the problem is much broader because of demographic challenges facing our state. Wisconsin is one of only about a dozen states that have more Baby Boomers than Millennials. So we find ourselves with fewer people in the pipeline to replace retirees who leave the workforce.
There is no silver bullet legislative solution to this problem, but there are ways the Legislature can be helpful nonetheless. For example, the state could offer school districts financial incentives to bring industrial arts programming back into our middle and high schools so more kids graduate with marketable job skills.
High school graduates also need greater exposure to the types of well-paying jobs available in today’s labor market and hands-on experience that will help land them. The Legislature should also incentivize schools to offer dual enrollment, internships, apprenticeships and job shadowing opportunities at local businesses for high school students as part of their coursework.
Regulatory Reform
Reducing Wisconsin’s regulatory burden was the number one reform the Legislature could enact to improve Wisconsin’s business climate according to a survey of WMC CEOs last month. In addition to addressing the cost of regulation, we must take steps to prevent unelected bureaucrats from imposing their will on Wisconsin families and businesses by regulatory fiat. It’s time to put lawmakers back in charge of policymaking for regulations that profoundly impact Wisconsinites.
To do so, the Legislature should pass a law similar to Assembly Bill 251 from last session that would require legislators to approve any rule costing $10 million or more before it can become law. There is no better way to make the bureaucracy accountable to voters – a goal everyone should support.
Other important regulatory reforms include placing an expiration date on regulations to force agencies to reassess whether they are still needed (or need updating) and requiring agencies to repeal two regulations for every new rule they promulgate.
Tax Reform
Although we have made recent progress, Wisconsin remains a highly-taxed state, and our top income tax rate is the ninth-highest in the country. There are a number of reforms that would put us on a much more level playing field with competitors in other states if they were implemented. For example, the Legislature should repeal Governor Doyle’s 2009 income tax hike that created a new top bracket. This punitive tax hits small businesses especially hard.
Other tax reforms that would better align Wisconsin with other states are repealing the Personal Property Tax businesses pay each year on things like furniture and equipment, and a full repeal of the state Alternative Minimum Tax.
Reducing Health Care Costs
Reducing the cost of health care was tied for the second-most important thing the Legislature could do to improve Wisconsin’s business climate in the WMC CEO survey conducted last month. Specifically, our members ranked enacting meaningful medical cost containment in the Workers Compensation program as one of the highest priorities for the 2017-18 session. Wisconsin continues to have medical costs in Workers Compensation that are well above the national average, and something must be done to contain them.
Wisconsin can also make meaningful progress to reduce health care costs by increasing reimbursements for Medicaid services, thereby reducing the amount of unfunded care that is shifted to patients with insurance. Minimizing this “hidden tax” on health care will improve affordability for all consumers.
The election on Nov. 8th was historic, and the Republican Legislature’s policy agenda should be historic as well. It’s time to double down on bold reforms to position our state for even greater economic prosperity in the future.
This column was first published in the January edition of Wisconsin Business Voice, a quarterly magazine produced by WMC that reaches 18,000 c-suite level business leaders across the state.