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

Video

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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About the Author

 

Andrew G.
Biggs
  • Andrew G. Biggs is a resident scholar at the American Enterprise Institute (AEI), where he studies Social Security reform, state and local government pensions, and public sector pay and benefits.

    Before joining AEI, Biggs was the principal deputy commissioner of the Social Security Administration (SSA), where he oversaw SSA’s policy research efforts. In 2005, as an associate director of the White House National Economic Council, he worked on Social Security reform. In 2001, he joined the staff of the President's Commission to Strengthen Social Security. Biggs has been interviewed on radio and television as an expert on retirement issues and on public vs. private sector compensation. He has published widely in academic publications as well as in daily newspapers such as The New York Times, The Wall Street Journal, and The Washington Post. He has also testified before Congress on numerous occasions. In 2013, the Society of Actuaries appointed Biggs co-vice chair of a blue ribbon panel tasked with analyzing the causes of underfunding in public pension plans and how governments can securely fund plans in the future.

    Biggs holds a bachelor’s degree from Queen's University Belfast in Northern Ireland, master’s degrees from Cambridge University and the University of London, and a Ph.D. from the London School of Economics.

  • Phone: 202-862-5841
    Email: andrew.biggs@aei.org
  • Assistant Info

    Name: Kelly Funderburk
    Phone: 202-862-5920
    Email: kelly.funderburk@aei.org

 

Nick
Schulz

  • Nick Schulz was the DeWitt Wallace Fellow at AEI and editor-in-chief of American.com, AEI's online magazine focusing on business, economics, and public affairs. He writes the “Economics 2.0” column for Forbes.com where he analyzes technology, innovation, entrepreneurship, and economic growth. He is the co-author with Arnold Kling of From Poverty to Prosperity: Intangible Assets, Hidden Liabilities, and the Lasting Triumph Over Scarcity. He has been published widely in newspapers and magazines around the country, including The Washington Post, The Wall Street Journal, the Los Angeles Times, USA Today, and Slate.


  • Phone: 202-862-5911
    Email: nick.schulz@aei.org

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