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George Daly
Business school dean

George Daly

George Daly is Dean of the McDonough School of Business at Georgetown University. An accomplished scholar, he also has taught courses on leadership and economics.

Wisconsin has two fiscal problems

Question: Gov. Scott Walker of Wisconsin continues to demand an end to collective bargaining rights for state employees even after winning their agreement on the benefit reductions he sought. These are the same state employees he must rely on to operate state government and implement his policies. How should he strike the balance between the urgent need to restore the state's fiscal health and his longer-term challenge of leading a large governmental enterprise?

By his lights, Governor Walker and his state actually have two fiscal problems: an immediate deficit, which can be addressed by appropriate adjustments to health care and other benefit policies for public employees in the current budget, and a longer-term problem arising from a process of bargaining with public employee unions that he believes will continue to threaten the financial viability of his government into the future. His state is not alone in being in this situation, but Governor Walker is largely alone in attempting to deal with both problems simultaneously--that is, by dealing with both the immediate deficit and with the systemic processes that he believes have produced these deficits and will likely continue to do so in the future.

I would give him very high scores for courage and forthrightness. He is, after all, doing what he (and the public employee unions) said he would do if elected. And his vision extends beyond the next election, a perspective that very few elected leaders have shared in the past, hence our recurring deficits. In current political parlance, he is most definitely not "kicking the can down the road."

On the other hand, his is a high-risk strategy, which is presumably why so few of our public leaders have embraced it in the past. Should he lose--should voters in Wisconsin decide that his policies with regard to public employee unions are too harsh--it will likely be a long time before they will be tried again. That is presumably why organized labor from outside the state has taken such an interest in this situation.

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By George Daly

 |  March 1, 2011; 8:46 AM ET
Category:  Economic crisis , Government leadership Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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Wisconsin and its public sector unions have tried "negotiating" for years and years.
All that happens is taxes increase, services are slashed, and union entitlements are bolstered (while young workers are fired).

Gov Walker is absolutely correct in trying to correct the root of the problem: the ring-fenced absurd public sector entitlements. These are 20%, then 40% then 50% and then 120%+++ of the WI state budget projects!

The union and its puppet Democrats are whining hard, they want yet another "band-aid" like the last 20 years. Sad. The non-public sector working class/ middle class in WI is being taken to the cleaners. Hopefully everyone leaves the state and sells their homes (with the highest property taxes of the nation) before the teachers.

Posted by: SamRon1 | March 6, 2011 4:18 PM
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While I agree that Gov. Walker’s actions were bold, I would caution against his continuance of action to cut down on the power of state employee unions. As he has already shown with his ability to work around collective bargaining in order to obtain reduced benefits, the complete abolition of collective bargaining may be a much harder pill to swallow and result in a loss in approval of Gov. Walker. He must walk a careful line between reducing deficit and alienating state employees. Like Dean Daly, I believe that Gov. Walker must be careful so that should he not be elected in the next election, his ideas and attempts to reduce the deficit will not end. Gov. Walker may have high ambitions and strong conviction, but without the ability to appeal to his public’s understanding and engage them in his decisions, he will lose the ability to affect change and reduce the deficit in the long term.

Posted by: katskilton | March 2, 2011 5:15 PM
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Here is proof that the meat of your statement is wrong http://politifact.com/wisconsin/statements/2011/feb/22/scott-walker/wisconsin-gov-scott-walker-says-he-campaigned-his-/

He did not campaign on this. this is why the biggest shift on the newest polls are from union households. Many union republicans got blind sided by this. That is why the police are protesting , the firefighters are as well.

The sheriff here pulled all his people saying that they will not be his "palace guard"

He should have comprimised when he won. Not that the wage cuts are a good idea either but hell. Like Milbank quoted from LBJ "anyone who won't take half a loaf has never been hungry"

That is the problem with these republicans. they have never had it hard and they have been winning for a long time they can't believe that the gravy train is over. The midterms america decided to give them a shot since Obama wasn't prosecuting any of these billionaire criminals and they take that as a mandate. It was a second chance and have blown it now. Walker is done.

Posted by: thereyago | March 2, 2011 4:52 AM
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Here is proof that the meat of your statement is wrong http://politifact.com/wisconsin/statements/2011/feb/22/scott-walker/wisconsin-gov-scott-walker-says-he-campaigned-his-/

He did not campaign on this. this is why the biggest shift on the newest polls are from union households. Many union republicans got blind sided by this. That is why the police are protesting , the firefighters are as well.

The sheriff here pulled all his people saying that they will not be his "palace guard"

He should have comprimised when he won. Not that the wage cuts are a good idea either but hell. Like Milbank quoted from LBJ "anyone who won't take half a loaf has never been hungry"

That is the problem with these republicans. they have never had it hard and they have been winning for a long time they can't believe that the gravy train is over. The midterms america decided to give them a shot since Obama wasn't prosecuting any of these billionaire criminals and they take that as a mandate. It was a second chance and have blown it now. Walker is done.

Posted by: thereyago | March 2, 2011 4:52 AM
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I don't know where you got the idea that he ran on this from. The reasons why people can't stand this weasel is precisely becasue he lied about making collective bargaining illegal.

There is a huge difference between saying he was going to negotiate for lower costs and taking away a labor right that has existed longer than most workers in Wisconsin. He is obviously bought and the national strategy he has put into effect in WI is completely transparent. Let me tell you he is no Cristie. Even if he was that east coast attitude won't fly out here.

This is not a fastfood business that needs to get rid of some employees. This is the state of Wi and we believe in the rule of law.

He is a megalomaniac who thinks that he is gonna be president someday. His actions to clear out the capital to make a good photo for his disastrous budget were expressly against the judicial ruling in accordance with our constitutionally guaranteed right to be in the capital. I know that seems weird if you are not from here and it may seem small but it is in our constitution. Instead he had tickets for his tea party and corporate backers. Try reading our local papers occasionally. the media is rolling out there no tax plan but you know what. WE are not gonna get stuck with the bill for two wars, the bailouts.

Eric Holder needs to get cracking on these bankers and we'll take care of walker.

Posted by: thereyago | March 2, 2011 4:41 AM
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