Kanavas Column: My Friend the Lawyer

I was at an event in Milwaukee last week and I bumped into a prominent local attorney. Many of his clients are the types of businesses that drive our economy; the small and midsized companies that employ anywhere from 10 to upwards of 500 or so people. These companies are established businesses, supporting real Wisconsin families. The conversation immediately turned to the budget and I asked him what his thoughts were on Wisconsin’s business climate and how he thought the budget was going to affect it.

From my perspective, as a businessman and legislator, the conversation did not go well. He was quick to point out that several of his clients were soon leaving the state. Two companies in particular have plans to move to Texas or the southwest. This comes at no surprise of course. Texas has no state income tax and has been adopting policies that favor business growth and job creation for years. What was a surprise though, was that both of his clients mentioned Governor Doyle’s budget as a contributing factor in their decision to leave.

I’ve received hundreds upon hundreds of phone calls, letters and emails about the budget over the last few months. Often the caller or writer will say something like “I just can’t take it anymore,” “our taxes are too high,” “I can’t afford to live here any longer,” or “I’ll be forced to leave this state if this budget becomes law.” I’ve heard it, I’ve read it, but I’ve wondered how many people are going to actually do it?

The conversation with my lawyer-friend was proof it was really happening. We have reached the point where businesses, which means jobs and people, are leaving Wisconsin because of what the Democrats have done and are doing in Madison. Unfortunately, when these companies do leave it isn’t going to be like General Motors; splashed over the front page of the newspaper. These businesses are going to quietly tip-toe out of town and the employees are either going to be out of work or moving out of state.

This scenario is a disaster, and it’s a disaster for a reason that may not be on the top of your mind. Not only does it mean that the Democrats unfettered control of the state legislature and governor’s mansion is driving people away from our state, but it also means things are only going to get worse.

I know it’s hard to imagine a situation worse than the one we’re in right now. The Governor just signed a budget bill containing $2.1 billion in new taxes and fees, increased spending by 6.8% and allowed property taxes to go up by $1.5 billion. Couple that with the state’s unemployment rate at roughly 9% and you would think we could only improve from here. But let’s not forget those companies we just forced out of town. They will have an impact on our future.

When the companies leave they’ll take their tax dollars with them. Those companies will not be paying property taxes or corporate income taxes. Their employees will not be paying property taxes on their homes or personal income taxes.

So what happens next year when the state crunches the numbers and discovers that fewer companies and fewer people paid taxes in Wisconsin? The situation will be worse. Deficits will be greater. The unemployment rate will be higher. These numbers will not go down until we change the way we do business. The economy is falling apart around us, and here in Wisconsin we raised taxes by $5 billion since January, grew the size of government and increased state spending.

People have to take a long hard look at the policies being pursued in Madison and realize they just don’t work. Our state is going to experience a net out-migration of producers and a net in-migration of people who are more dependent on government.

We are killing our economy and our future.

If we don’t change and change soon, I may bump into my lawyer friend again, but it just might be in Texas.