Paul Soglin: Waxing America

Zilber's Gift: It Is More Than The Money

When it was announced that Milwaukee business and civic leader, Joseph Zilber, was giving $50 million to fund neighborhood initiatives the response, as expected, expressed gratitude and hope.

Zilber gives $50 million Philanthropist hopes to revive low-income areas in city, encourage others to give

Milwaukee Mayor Tom Barrett called the action "an unbelievably generous gift from Joe Zilber to this city."

The Milwaukee Journal-Sentinel article focused on something just as important as the size of the gift, it's scope:

The Zilber Neighborhood Initiative, as the effort will be called, will work with local organizations to support specific efforts to improve the quality of life in up to 10 neighborhoods...

...A key early step will be creating or selecting a "central intermediary," an organization to oversee the effort and make decisions on where money should go, while giving neighborhood organizations and representatives a strong voice in what goes on.

The gift to the people of Milwaukee measured in dollars is obvious.  Not so obvious is the thought and planning that went into the structure of the gift. As Zilber noted:

...There are a great many individuals and foundations prepared to invest resources to strengthen our community. For months I have worked behind the scenes with these entities. My mission is to mobilize them with good ideas, strong proposals and the promise that our shared commitment to our great city will yield positive results...

Joseph Zilber and his advisers gave careful thought to the structure of neighborhoods, how neighborhoods change, and the importance of building upon neighborhood assets:

We can (and must) act quickly and decisively to support programs that work, replace those that don't, bring proven and promising solutions to scale, sustain them long enough to gain traction and provide them with sufficient resources to get the job done.

The selection of Susan E. Lloyd of the Program on Human and Community Development to direct the effort is just one more indicator that this is a well planned gift. The money is important, but the context makes it even more valuable.

Brittany Zimmerman Phoned - Reach Out And Touch Someone

Before Brittany Zimmerman died, her last effort was a telephone call. Brittany tried to reach out and touch someone.

The most important domestic function of government is to safeguard the innocent: those who need assistance when they cannot protect themselves. To establish justice and promote the general welfare.

Society tries to prevent crime. When it cannot, it offers assistance in many forms, including 911 services which we all pay for, in part, through taxes and special fees.

I cannot imagine a more poignant example of a 911 call than a person, life at risk, dialing for help, dialing for that life.

It is the very instant where they manage to dial the number but cannot speak out that we are expected to listen and respond. It makes for gripping stories and haunting movies.

For Brittany Zimmerman it was a cold, lonely reality.

Now comes the blame. First there is the dispatcher who became too busy and moved on to other calls and forgot about Brittany. Them comes the director of the 911 Call Center who did not help his agency's stature by implying there was no reason to apologize.

The fault is more complicated than that. There are a lot of capable 911 dispatchers who could fail under the same circumstances.  It is reminiscent of the constant reminders of problems in our nation's skies. Air traffic control: Safety concerns on the nation's radar: As controllers keep their eyes on the skies, mistakes and cover-ups are surfacing.

The system did not function:

• an overworked dispatcher.
• a policy that police only automatically respond to a silent 911 call from a land line, not a cell phone.
• a lousy system for linking cell phones to their location - with all of the telephone company/government spying, you would think that emergency dispatch centers could have the primary address of every cell phone number.
• underfunded critical government services (the 911 center is just one of many).
• a desire for simple solutions like blaming the dispatcher.
• and do not forget the morons who deliberately call 911 unnecessarily.

Government failed Brittany Zimmerman. Government failed all of us. In turn, the time consuming, boring task of making systems work, focusing on public management and administration does not appeal to either politicians or the public. 

In 2004 Dane County conducted a study of the dispatch center and the 911 system.  That study predicted significant failures if reforms were not instituted. That study is one of thousands floating around city and county halls, state capitols, and Washington D.C.

They still float.

We all failed Brittany Zimmerman.

Overture's Problems Start With the Structure

It is not a surprise that the Madison based Overture Center is in financial trouble. Anyone who follows the stock market would suspect that the first quarter of the year was not kind to the trust fund established by benefactor Jerome Frautschi. The Capital Times noted Overture trust fund falls below $100M:

Frautschi, whose original $205 million gift to the city was the foundation for the world-class arts facility, agreed to fund the center's debt service if the amount of the trust fund dipped below $100 million. At the end of March, the fund stood at $98.9 million, down from $106 million at the end of 2006.

There is a group of civic leaders who will meet on their own time at their own expense to work on the problem:

A group of Overture patrons is in the process of organizing a panel with expertise in financing and public funds to come up with recommendations to tackle Overture's financial woes. Mark Bugher, former state Department of Administration secretary and current director of the University Research Park, said he was asked to get the effort off the ground.

That is a sound contribution to the community, but it does not get at the inherent problem, the structure of Overture. It is neither fish nor fowl, nor mammal for that matter. Cobbled together to meets the needs of a community that wanted Overture, but with no government wanting responsibility, the structure is not conducive to day to day management nor for long range planning.

There is no chief executive responsible to the public for the management of the facility. There is an executive director, who reports to a board, but the board is neither elected itself, nor do they report to any one chief executive.

The staff is hired by one agency, the city who handles hiring and firing. But that staff is directed, not by the city, but rather Overture.

None of this really makes sense.

Any long range solution to financial or management problems will come with an improved structure.

Superior Linens Racine County Contract Needs Airing

Superior Health Linens has contracts in Wisconsin with a number of public and private health care providers.

It once had a contract with Dane County but no more. There were allegations of unsafe working conditions and that resulted in the finding of three 'serious' OSHA violations. Then there were the problem of wages - Superior did not pay a living wage. Dane County dropped the contract in 2006 for the Badger Prairie Heath Care Center.

Now Superior is embroiled in a debate in Racine County over services related to the Ridgewood Care Center. What is curious about all of this is the conduct of certain public officials who are less than forthcoming about the contract. From the Racine Journal Times:  County's top lawyer berates supervisor over contract allegations

It’s not unusual for county staff to talk to the county board, but what was unusual Tuesday evening was Corporation Counsel Jonathan Lehman chastising Supervisor Diane Lange for her comments about a contract he reviewed.

In addition to the rather uncivil discussion there is a series of postponements and delays in reviewing the contract details. All of which makes us wonder if Diane Lange loses her re-election bid, will all of this be hidden with the rest of the dirty laundry?

Needless to say, many of Superior's employees are in low skilled jobs; some have limited knowledge about their rights as workers. Thankfully, that is changing thanks to the efforts of Unite Here  - the result of the merger between the Union of Needletrades, Industrial and Textile Employees (my grandparents union) and the Hotel Employees and Restaurant Employees International Union.  As Unite Here states:

UNITE HERE boasts a diverse membership, comprised largely of immigrants and including high percentages of African-American, Latino, and Asian-American workers. The majority of UNITE HERE members are women.

WMC Reversal on Hospital "Tax" - Now They Must Apply Pressure

As reported in The Capital Times: WMC now backs hospital tax.

As Waxing America observed two weeks ago: Hospital 'Tax' Supported from Left to Right, Except WMC

...if two opponents changed their minds, resolution would be forthcoming. The first is the Republican leadership in the Wisconsin Assembly, the second is their puppetmasters, Wisconsin Manufacturers and Commerce (WMC).

OK, we got the order wrong.  But moving on...

If adopted by the Wisconsin legislature, the assessment will bring in over $420 million in additional federal Medicaid payments to Wisconsin.

Our original WMC Watch* program raised this issue with individual members of the WMC board for the last eight months; since January 1, 2008 I spoke to a half a dozen of the WMC board members about the need for them to learn more about the plan. I asked them to look beyond the limited information provided by the WMC staff, which recommended the organization oppose this excellent plan introduced by Governor Doyle almost a year ago.

The reversal of position, which must have been difficult for WMC, has implications that go far beyond this immediate issue:

• It demonstrates that WMC board members need more information on public policy issues than the limited details they get from their own staff.
• Second, it is evident that many WMC board members make sound decisions when given access to information.
• Third, our original WMC Watch* program was correct in its premise that ratcheting up the public discussion in the Wisconsin press, blogs, and among the WMC members will continue to advance the discussion of public policy.
• Fourth, the editorials in Wisconsin newspapers had an effect in isolating WMC and causing the reversal.
• Last, while the WMC endorsement is important for passage, there is still critical work needed to gain the support of the Republican controlled Wisconsin Assembly, where the conservative leaders remain steadfast in their opposition.

Now WMC must show this new enlightened position is not just for show. We all know that if they exert the same pressure they apply when getting their way on tax issues for their members, enough Republican Assembly members will support this measure for passage.

*There is a new WMC Watch operated by One Wisconsin Now (OWN) which is not to be confused with our program - thus the sporadic reference to the "original WMC Watch."

Going After Tax Evaders is a New Tax Increase: WMC

Last night I had a opportunity to hear Jack Norman, Research Director of the Institute for Wisconsin's Future speak about Wal-Mart and its use of loopholes to legally avoid paying taxes.

I started to wonder. Imagine that Wisconsin took steps to change the state law so that Wal-Mart would have to pay the taxes.

Would Wisconsin Manufacturers and Commerce (WMC) consider remedial legislation to fix the problem an amendment of the existing tax laws or would they consider that a new tax and/or a tax hike?

If anyone can get near to this august body that prides itself on patriotism and loving the state of Wisconsin, please put the question to them.

Here, from Broken Partnership: How Wisconsin’s Corporate Sector Underpays State and Local Taxes by $1 Billion is what Wal-Mart does to avoid the taxes.

Wal-Mart has a separate corporation that owns the real estate. Wal-Mart makes sure that the rent is high enough so that the stores never make a profit. Of course, the real estate holding trust that owns the land and building make a lot of money - like several hundred million dollars.

...The Wal-Mart operation that owned the stores collects rent is set up as what is known as a real-estate investment trust (REIT).

The REIT's profits, paid out in dividends to Wal-Mart are tax-free.

That is because the REIT is located in a state that does not tax the profits from rents. Very nifty. Figure out a way of showing no profit in Wisconsin and move the income in the form of a rent to another state.

Wal-Mart and WMC do not hate all lawyers. They must love the ones who figured out these tax loopholes.

Look into your pockets. Not a lot there?

That's OK. Wal-Mart and WMC wish to thank you for paying additional taxes since someone has to make up for their clever tricks.

Remember, if you support fixing this problem you are a supporter of big government who just wants to raise taxes.

Remember the WMC motto: Standing Up for Business! If it is good for WMC, it is good for you!

Wisconsin Manufacturers & Commerce Tries Socialism

When it was in the best interest of Wisconsin Manufacturers and Commerce (WMC) to shift costs from their members to the general public, the Madison based lobbying cabal was never shy. One of the best examples of WMC hubris is found in their 2007-2008 Legislative Agenda, WMC, Standing Up for Business.

Tucked away on page ten is an agenda item that WMC says reflects "...our strong environmental ethic..."

Encourage the cleanup and redevelopment of contaminated sites by strengthening and improving tax and other financial incentives and liability protections.

In other words let government do it and take the money from the taxpayers.  Instead of having the responsible private property owners clean up the contamination, have everyone pay.

A little socialism right here in Wisconsin.

WMC is shameless. Contaminated brownfields are the responsibility of the owner. Property owners do not expect the rest of us to pay for the cost of grading, laying utility lines on their property, or preparing the site for construction.

American capitalism and free enterprise expect you, the homeowner, to pay your own bills the next time the furnace goes out or the roof needs repair. But WMC, filled with hubris, wants the rest of us to pay and provide financial incentives if some business finds its soil contaminated.

You have to wonder, if after the cleanup is complete and the land is productive, will WMC support the public getting a return on investment and a share in the profits?  I am not speaking of the normal property taxes - that is already expected of all private property owners. I am speaking of the return any investor or shareholder expects. Dividends. Pay outs. Big bucks.

They have absolutely no shame.

And there is more.

Lack of State Support Hurting Students, University of Wisconsin System

This week the University of Wisconsin System Board of Regents are meeting. A major issue on the table is tuition, including plans to vary tuition based on campus attended, family income, and adjusting aid formulas. Milwaukee Journal Sentinel: UW System to look at tuition restructuring

An advisory group recommended Thursday that the University of Wisconsin System Board of Regents consider new ways to increase tuition revenue at a time when less of the system's funding comes from the state.

I recently read where a financial advisor said that paying off student loans has changed since I went to school. My generation had a reasonable expectation of ending the debt within five years of graduation; this generation has to treat the student loans like a mortgage with a twenty year payoff.

Which brings us to the central point. State government is reducing its participation, driving up the cost to students, driving down faculty salaries, and deferring plans for needed improvements.

In recent months I met with many business leaders from throughout the state. They echo or paraphrase what Northwestern Mutual Insurance CEO Ed Zore said some time ago, "The issue is not taxes, it is workforce development."

Here are facts to consider- this is not just about tuition, but the impact on the entire UW System budget:

• In the early 1970's the state provided 50.7% of the budget for the UW System. In 2006-07 that number dropped to 24.2%.
• As the MJS reports, "A quarter of Wisconsin residents 25 and older hold bachelor's degrees, a figure that lags behind Illinois and Minnesota. "
• UW-Madison faculty salaries are among the lowest in the Big Ten. Combined with the refusal to provide health care benefits to domestic partners, a nominal cost, it is difficult to recruit and retain the best professors.
• College graduates more than repay the cost of their education, because the taxes they pay back as a result of their greater earning power are more than twice that of a high school graduate.

Pew Gives Wisconsin a B- Biennial State Grading

The Pew Center on the States, an arm of the distinguished Pew Charitable Trust, has issued its 2008 grading of the states. As in 2005-06, Wisconsin receives a B-, the average grade for all states.

The State Management Report Card for 2008 ranked thirteen states higher than Wisconsin. States were evaluated based on: (Wisconsin grades follows the description)

• People - the quality of state employees B-
• Money - fiscal policies, including preparation for economic declines C+
• Infrastructure - capital planning and maintenance as well as governmental coordination B -
• Information - uses of technology, budgeting techniques, and management performance C+

Curiously, or not, the Wisconsin evaluation begins with a reflection on the high quality of state employees and the treatment of Georgia Thompson. The authors reflect, "The personnel situation even sounds a little Kafkaesque when you hear the story of Georgia Thompson. A well-respected state procurement supervisor protected by civil-service rules, she was briefly jailed in 2006 in a politically motivated prosecution."

The structural budget deficit is noted  and acknowledgment is made that Wisconsin is handling its infrastructure better.

In a little sidebar, it is noted that Wisconsin's per capita spending is $5,303 which ranks the state 24th. Our average per capita income is $24,875 which ranks us 20th.

Clearly we are taxing ourselves and spending within our means.

Other conclusions:

• We need not fear raising state revenues so we can set aside a reserve and ensure that the budget is balanced in the worst of economic times.
• We are improving our infrastructure, but we still have a ways to go.
• We should appreciate this generation of public employees and start demonstrating our respect for them if we wish to continue to attract and retain dedicated public servants. Frankly, I am a bit stunned at those who admire our soldiers, but distain them when they return to their public jobs.
• We need to improve our technological capabilities, which will lower the cost of government and improve service. 
• We need to focus on quality.

Hospital 'Tax' Supported from Left to Right, Except WMC

When I first came to Wisconsin as a student in 1962, I heard the constant chatter about how our state ranked last in receiving federal dollars relative to all of the money we sent to Washington.

Wisconsin lacked in defense industries, military bases, and space centers. To make matters worse we did not lead the nation in significant populations living in poverty or that were elderly. Consequently, we could not maximize dollars spent on poverty, entitlement, or block grant programs.

I am not a big fan of taxing any form of heath care. But the proposed gross receipts tax on Wisconsin hospitals of .8 percent makes sense. Unfortunately.

But that is not five percent, or one percent, but 4/5's of a percent.

As The Capital Times noted in its March 1, 2008 editorial, Hospital tax pays for itself

The tax would have brought in about $400 million from the hospitals, but the hospitals would have received that $400 million and more in matching federal money to help pay for Medicaid programs.

That is because the federal government will match much of the revenues. By not imposing the tax, we leave hundreds of millions of federal money on the table - in Washington D.C.

Madison's progressive newspaper is not the only one supporting the tax. The not quite so liberal, Appleton Post Crescent, says Hospital tax needed to ease budget crunch

It (the hospital tax) may even end up reducing costs for those with private insurance, too, since hospitals have said they make up for the poor Medicaid reimbursements by charging the insured more. With better reimbursement, they wouldn't have to.

The hospital tax is favored by hospitals and will bring in more money. The state can't afford to let the hundreds of millions of dollars slip away a second time.

Keep in mind that the projected Wisconsin budget deficit is $650 million. While these federal monies could not be used to fill the budget deficit, it demonstrates the magnitude of the matter.

Not surprisingly,  if two opponents changed their minds, resolution would be forthcoming. The first is the Republican leadership in the Wisconsin Assembly, the second is their puppetmasters, Wisconsin Manufacturers and Commerce (WMC).

Here are the health career providers who sit on the WMC board of directors who are trapped between the best interests of their companies and the powerful business lobby:

• Marshfield Clinic
• Aspirus Wausau Hospital
• Gundersen Lutheran
• Humana Inc.