Conservatively Speaking

State Senator Mary Lazich (R-New Berlin) represents parts of four counties: Milwaukee, Waukesha, Racine, and Walworth. Her Senate District 28 includes New Berlin, Franklin, Greendale, Hales Corners, Muskego, Waterford, Big Bend, the town of Vernon and parts of Greenfield, East Troy, and Mukwonago. Senator Lazich has been in the Legislature for more than a decade. She considers herself a tireless crusader for lower taxes, reduced spending and smaller government.

State Senate Committee Acts on Bureaucratic Overreach

Business, Legislation

Earlier today, the Senate Committee on Small Business that I serve on met to discuss payday loan regulations put forward by the Department of Financial Institutions (DFI).  The new regulations follow the payday loan bill, signed into law earlier this year.

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Wisconsin economic performance near the bottom

Economy, State budget, Business

When a new economic report is issued about Wisconsin, you can bet the news will be gloomy.

The American Legislative Exchange Council (ALEC) has released its 2010 edition of “Rich States, Poor States” that ranks all 50 states on their economic policies and performance, and also forecasts the states best equipped to rebound from the rough economy. ALEC bases the economic performance rankings of the states on three factors: personal income per capita cumulative growth from 1998-2008, domestic migration from 1999-2008, and non-farm payroll employment from 1998-2008.

Wisconsin has the seventh worst economic performance ranking, #44 (1=best 50=worst). Last year, Wisconsin’s economic performance ranking was #41.

From the ALEC report:

“To give you a more in-depth look at which states are asking more from taxpayers—and in the process making their states less competitive— we have put together our very own top 10 list of biggest state losers for 2010. Wisconsin:  Raised its income tax rate to 7.75% on incomes above $225,000 and also increased cigarette taxes.”

Wisconsin’s property tax burden is the tenth worst in the nation.

Co-author of the report and highly-regarded economist Dr. Arthur B. Laffer said in an ALEC press release, “Tax and economic policies are essential to the competiveness of our states. Most actions being taken in state capitals today—and practically all actions from Washington, D.C. today—are flat-out wrong.”  

“The tax-and-spend attitude in Washington, D.C. is making the problem far worse for states,” co-author Stephen Moore said. “Once the federal stimulus dollars dry up, only federal requirements will remain—and states will be left with bloated programs they are no longer able to afford.”

According to the release, the authors “found that states with a high and rising tax burden are more likely to drive away individuals and business, while those with lower and falling tax burdens are more likely to attract businesses and create jobs.”

The solution for the states: Reasonable spending limits. The report says, “If states would have simply allowed their spending to grow at the rate of population plus inflation (PPI) growth, they would (almost without exception) be sitting on budget surpluses instead of facing deficits.”

Some states have actually cut taxes. Vermont lowered its income tax rate, North Dakota reduced personal income tax rates and property taxes, and Louisiana adjusted its tax brackets. The ALEC report calls efforts to provide tax relief “a silver lining” amidst all the gloom and doom.

ALEC concludes that Washington has actually done more harm than good to states:

Washington would be wise to end all federal aid for states, because the money that Washington spends has to come from states—it is far from being free. Instead state lawmakers should ask Congress to focus on broad economic growth policies that will put states back in the black. This should include low, flat-rate taxes, government spending restraint, sound and stable money, free trade, and minimal regulation. State fiscal policies have a profound impact on their relative economic performance. Governors and state legislators would be wise to tell Washington next time it offers bailout dollars: ‘Thanks, but no thanks’.”

Here is the ALEC report and the ALEC press release.

Congratulations to these outstanding businesses

Business, Good news from Senate District 28

Congratulations to the following businesses located in Senate District 28 that I represent that were named in the Milwaukee Journal Sentinel’s list of
Southeastern Wisconsin's Top 100 Workplaces:

HNI Risk Services Inc., New Berlin

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Mooving back to #1


has been advertising that it has happy cows. If California’s cows are happy, Wisconsin’s herd must be ecstatic.

The Stevens Point Journal reports the pattern of Wisconsin’s cheese growth continues upward. According to the USDA, Wisconsin’s cheese production outpaces California’s by 0.43 billion pounds.

At one time, California threatened Wisconsin’s proud and long-held reputation as America’s Dairyland. Bob Cropp, UW-Madison professor emeritus says the pendulum has shifted back to Wisconsin.

Cropp believes several factors contribute to Wisconsin’s superior agricultural growth to California. Our weather is best suited to cows, we enjoy diversified dairy systems, strong agribusinesses support the growth of dairy, high competition results in higher and quality production, and the state legislature has been quite supportive of the industry.

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Wisconsin's Economic Recovery Will Require Patience

Economy, Business

was hurt less than other states during the recession. However, Wisconsin does not possess a magic formula to rebound quickly. Job growth is coming. Unfortunately, a return to prosperity will take a long time.

Two noted experts shared their economic forecasts at a symposium presented at the state Capitol sponsored by the Wisconsin Legislative Council. Mike Knetter, the Dean of the Wisconsin School of Business at the University of Wisconsin-Madison and Rick Mattoon, Senior Economist and Economic Advisor at the Federal Reserve Bank of Chicago addressed the U.S. economy and its implications for Wisconsin.

The absence of certain factors prevented Wisconsin from suffering a more severe recession. Wisconsin did not experience the level of overbuilding and excessive lending that swept other parts of the country. News that only Iowa outperformed Wisconsin in the Midwest region during the recession and that Wisconsin’s economy is stabilized provides little, if any consolation to struggling families.

Wisconsin’s unemployment rate has not risen as quickly as the nation’s. American job losses have piled up and returning to previous employment levels will be a daunting task. During August 2009, there were 1.3 million fewer jobs in the United States than had existed during 1999. Richard Mattoon of the Federal Reserve Bank in Chicago does not foresee job growth for a protracted time in part because businesses are hesitant to bring on new employees until they are confident that the downturn is over.

Mattoon offered the audience what could definitely be classified as a worst-case scenario, a study by Rutgers University. Authors calculated America’s job deficit, i.e., job losses plus lack of new job creation, would total 9.39 million by December 2009.America’s New Post-Recession Employment Arithmetic” reports, “Erasing this deficit will require substantial and sustained employment growth. Even if the nation could add 2.15 million private-sector jobs per year starting in January 2010, it would need to maintain this pace for more than 7 straight years (7.63 years), or until August 2017, to eliminate the jobs deficit!”

So what about Wisconsin? We have our strengths. Remember, we excel in manufacturing, a sector the state has outperformed the rest of the country. Agriculture, higher education, patent counts, research and development, licensing and royalties, and a devoted workforce levels are also huge plusses.

Our weaknesses prevent a faster climb out of our economic abyss. Manufacturing, a longtime Wisconsin trump card, has taken a back seat to a national shift toward knowledge and service economies. Wisconsin has a world class university meaning the state is a high producer of human capital. However, we train these intelligent young people and we export them and their innovations.  Additionally, ideas, products and services created in Wisconsin get commercialized elsewhere due to a culture that is big on modesty and low on willingness to take risks.

UW Business School Dean Michael Knetter contends that because Wisconsin is heavy on manufacturing and light on knowledge and service economies, the state seriously lags the rest of the nation in income and wealth. Richard Mattoon sees Wisconsin’s continuing budget deficits as an issue in need of attention.

Michael Knetter’s outlook and advice for Wisconsin: Unemployment will be nine percent at the end of 2010 meaning there will still be a number of discouraged workers. Wisconsin must defend its strengths and at the same time venture into areas like knowledge and service economies that will garner higher profits and wages. He concludes, “We just need to ride out the recession like everyone else.”

Richard Mattoon’s outlook and advice for Wisconsin: The state Department of Revenue predicts pre-recession job levels will not return here until 2012. Wisconsin needs to boost its production and retention of coveted human capital and stabilize its fiscal condition by creating an environment that makes the state a great place to do business.

Providing wellness program incentives to everyone

Business, Legislation

The state Senate Health Committee that I serve on conducted a public hearing Wednesday, February 24, 2010 about legislation that would exempt wellness programs from unfair trade or marketing practices. Under current Wisconsin law, fully insured and individual health insurance plans are prohibited from providing benefits that are not spelled out in the policy. Therefore, they are prohibited from advertising, marketing, offering or operating a wellness program without violating an unfair trade or marketing practice. Senate Bill 502 that I have co-sponsored would allow health care providers to offer wellness program incentives to all clients without violating unfair trade or marketing practices.

The Wisconsin Legislative Reference Bureau in its analysis of SB 502 writes, “A wellness program is designed to promote health or prevent disease by offering a reward to insured individuals.” Wellness programs include smoking cessation weight loss, stress management, and nutrition improvement.

Meg Christianson, a nurse coach for Humana that provides coverage to more than 400,000 Wisconsinites gave excellent testimony about SB 502.  Meg Christianson told the Senate Health Committee Wisconsin must provide wellness program incentives to everyone and ensure reasonable alternatives for persons with medical conditions that make it medically unadvisable for them to participate or satisfy the program standard.

She reminded committee members current federal nondiscrimination rules under the Health Insurance Portability and Accountability Act (HIPPA) provide protections to ensure wellness programs do not unfairly discriminate on the basis of health factors. The Americans with Disabilities Act requires that wellness program information is treated confidentially, separate from employer personnel files and only accessible to wellness program personnel.

More and more employees are spending time at work, Meg Christianson testified, making the workplace an ideal spot to engage people in wellness programs. Workers that participate in employer-based wellness programs have better on the job decision-making and time management skills and greater loyalty to their company.

Businesses that invest in workplace wellness programs can enjoy savings through lower healthcare costs, decreased absenteeism and decreased workers' compensation claims. A MetLife survey found that more than half, 57 percent, of larger employers, those with 500 or more employees, during 2008 were providing employees with a wellness program, up from 49 percent during 2006. reports, “Employee wellness programs just may be the cure for companies struggling to keep up with rapidly rising health care costs. According to the Kaiser Foundation's Employer Health Benefits 2008 Annual Survey, average premiums for employer-sponsored health insurance for family coverage increased 119 percent between 1999 and 2008. The report, which surveyed randomly selected public and private firms, also found that more employers are turning to employee wellness programs -- more than half of the small and large firms that offered employee health benefits also offered some form of a wellness program.”

I wholeheartedly support SB 502Wisconsin s
hould provide the flexibility businesses need to provide wellness programs that can lead to healthier lifestyles, longer lives, and reduced health care costs.

Number of private businesses on the decline in Wisconsin


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Congratulations ABB, Inc. of New Berlin!

Business, Good news from Senate District 28

ABB, Inc. is one of the Wisconsin companies nominated for the Wisconsin Manufacturer of the Year Award. 

ABB provides power and automation products, systems, solutions, and services.

Congratulations and best of luck to ABB, Inc.of New Berlin!

The Christmas tree business in Wisconsin is resilient


harvests close to one million Christmas trees per year. Trees are big business in Wisconsin. Even though the harvest during 2007, the latest year information is available from the national Christmas Tree Association, was down 41 percent, Wisconsin ranks number five in the nation for Christmas tree production. 

A long drought in the northern part of Wisconsin hurt the harvest more than the economy, and since the drought has ended, insiders are optimistic the tree business will bounce back. 

The National Christmas Tree Association has published these 10 myths about Christmas trees.

Wisconsin products make great Christmas gifts

Business, Good news from Senate District 28, News you can use

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Another great cranberry year


Heading into cranberry season, Wisconsin expects to have another great fall harvest, though it will not match the record 2008 yield. 

The Milwaukee Journal Sentinel reports more berries are being exported overseas where the fruit is considered sexy.

Randy Papadellis, chief executive officer at Ocean Spray says the hot new product this year is Cranergy, an energy drink targeted to on-the-go soccer moms.

Growth in one of Wisconsin’s biggest industries is critical because it helps the entire state’s economy.

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The message is clear: Wisconsin unfriendly to business


The headline in the Racine Journal Times reads:

Business people complain: State is a tough place for business”

That sounds all too familiar. Earlier this year, I was part of an effort by legislative Republicans to hear from businesspeople across the state about Wisconsin’s business climate and state policies that affect their ability to compete.

What we heard was extremely troubling.

A similar listening session was held at a Racine County Business Summit. The Racine Journal Times  reports, “Steven Jenkins of accounting firm Jenkins & Vojtisek, said he perceives from clients a less friendly business climate. ‘I have never had so many questions about, ‘How do I move my business, or my home, out of the state. ... I'm not going to retire or expand here,' he said.”

Our job creators, the business community, are speaking out loudly and clearly. It is time to start paying attention and then doing something about it. Wisconsin needs to take dramatic measures to improve its business climate, one of the worst in the nation.

Lights! Camera! Curtains?

Legislation, Taxes, Business

It sure was great to see popular Hollywood star Johnny Depp filming “Public Enemies” in Wisconsin during 2008. Production of the movie in various Wisconsin locations was only possible because of a program offering tax breaks as incentives to film makers.

However, it is realistic and prudent to question whether Wisconsin is getting enough box office bang for its buck. Wisconsin is one of many states reconsidering how much money it pumps into luring Hollywood producers to America’s Dairyland to make movies. One of the questions raised during the 2009-11 state budget deliberations was whether Wisconsin’s program that provides tax incentives for filmmakers is effective or too generous. Governor Doyle chopped funding for the program in the 2009-11 budget signed into law. 

The LA Times notes that in the case of “Public Enemies,”  after the tax breaks were dished out that helped offset costs for, among other expenses, Depp’s hair stylist, makeup artist, and two chauffeurs, the net gain was debatable as to its worth. 

Wisconsin’s batch of incentives has now been reduced substantially, leading one to wonder if the state can even compete with 39 others offering tax credits, some that are much greater.

In Iowa, the program has led to a full-blown scandal. 

Wisconsin surely wants to and needs to attract business, including exciting ventures like box office smashes. However, when pink slips are being handed out to workers, it is difficult to justify expensive subsidies of Hollywood stars.

Wisconsin's abysmal business climate ranking gets even worse

Business, Taxes

The nonpartisan Tax Foundation in Washington D.C. keeps track of each state’s business climate. I have often blogged about Wisconsin’s dismal rankings, near the bottom of the pile. That’s no surprise, given how unfriendly Wisconsin is to business. 

The latest rankings are out, with the #1 state being the best state to do business and #50 the worst. The Tax Foundation reports:

“The top 10 states in the 2010 Index, from 1st to 10th, are South Dakota, Wyoming, Alaska, Nevada, Florida, Montana, New Hampshire, Delaware, Washington and Utah. The bottom 10 states, from 41st to 50th, are Vermont, Wisconsin, Minnesota, Rhode Island, Maryland, Iowa, Ohio, California, New York and New Jersey.”

Wisconsin ranks #42, a drop from a not so positive # 38 last year. Why the decline? According to the Tax Foundation:

“The blame for Wisconsin’s drop falls on the creation of a new income tax bracket: 7.75 percent on taxable income over $225,000.”

The new tax bracket hurts the wealthy that invest and create jobs.

The Tax Foundation writes:

“The ideal tax system, whether at the local, state or federal level, is simple, transparent, stable, neutral to business activity, and pro-growth. In such an ideal system, individuals and businesses would spend a minimum amount of resources to comply with the tax system, understand the true cost of the tax system, base their economic decisions solely on the merits of the transactions,

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Another big cranberry year


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Higher corporate taxes = lower wages

Taxes, Business

There are a number of studies concluding that in other countries, high corporate tax rates tend to depress wages. A new study by the nonpartisan Tax Foundation in Washington D.C. that examined state-local corporate taxes in all 50 states finds the same causal relationship in America.

States with high corporate income taxes see the wages of their workers depressed over time. States with lower corporate taxes enjoy an increase in worker productivity and wages.

The Tax Foundation writes the following in its report, “The Corporate Income Tax and Workers’ Wages: New Evidence from the 50 States” that reviewed state data from 1970 through 2007:

“A one percent drop in the average tax rate leads to a 0.014 percent rise in real wages five years later. In dollar terms, that means wages rise $2.50 for every one dollar reduction in state-local corporate income taxes. The reverse is also true: A one percent hike in the average tax rate leads to a 0.014 percent drop in real wages, or roughly a $2.50 loss in wages for each one-dollar rise

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Illinois could help Wisconsin

Business, Taxes

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Business leaders spoke, we listened: Policies to create jobs in Wisconsin

Business, Taxes, State budget

The Wisconsin Jobs Now Task Force that I serve on along with other Republican legislators has been holding roundtable discussions around the state, 
listening to the expertise and concerns of businesspeople about Wisconsin’s woeful business climate.

As promised, the input from the roundtables has been incorporated into a final report of recommendations to the Legislature to create jobs and stimulate our economy.

Among the report’s recommendations:

Reduce the Personal Income Tax
The Task Force recommends an overall reduction in individual and employer taxes to keep businesses here and attract new businesses and job-creation opportunities to Wisconsin.

Repeal 11% Employer Tax Hike Passed in February
The Task Force recommends repealing the new combined-reporting tax and the new tax on custom software.

Freeze property taxes
The Task Force recommends maintaining a strong property tax freeze to reduce the ever-increasing burden placed on businesses looking to expand or trying to attract new employees.

Simplify and Streamline Tax Code
The Task Force recommends streamlining, consolidating, and cutting fees on employers.

Stop the increase in the Capital Gains Tax
The Task Force recommends opposing an increase in the capital gains tax that is in Governor Doyle’s proposed state budget and the budget recently adopted by the Legislature’s Joint Finance Committee.

Reduce the Tax Burden on Expansion/Retooling
To help Wisconsin employers stay competitive, and to create jobs for equipment suppliers, the Task Force recommends providing tax relief on new equipment purchases.

Stop the “Brain Drain”
The Task Force recommends creating a business-recruiting team to bring high-tech and cutting-edge industries and startups to Wisconsin.

Freeze on new regulations
The Task Force recommends a freeze on all new regulations until the economy

Expediting the permitting process
The Task Force recommends guaranteeing agency permitting responses within a reasonable amount of time.

Help small businesses afford health insurance
The Task Force recommends allowing small businesses to pool together to achieve significant health insurance cost savings.

Guarantee reasonable caps on non-economic damages for medical malpractice cases
The Task Force recommends establishing low long-term caps on non-economic damages.

Stop raids on Injured Patients and Families Compensation Fund
The Task Force recommends prohibiting future government raids on the fund to attract and retain high quality health care providers.

Move Toward Patient-Centered Care
The Task Force recommends that Wisconsin implement a system that patients have access to the information they need to make informed decisions and have control over their health care dollars.

Don’t repeal the 1995 reforms in Joint-Several Liability statutes
The proposed changes could make an employer who is as little as 1% at fault, 100% liable for damages. 

Don’t increase auto insurance costs
Proposed changes will increase auto insurance rates by more than 33% and bring Wisconsin rates from the 3rd lowest in the country to one of the highest, increasing costs on employers, and killing jobs.

Don’t increase the state minimum wage above the federal minimum wage

Don’t adopt proposed changes to Prevailing Wage Law

You can read the final report of the Wisconsin Jobs Now Task Force here.

Soaking the rich

State budget, Taxes, Business


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Mixed results in Wisconsin’s annual report card

Business, Taxes

I often blog about reports that rank the state of Wisconsin in various categories: taxes, spending, income, business climate, competitiveness. These reports are critical because they provide a barometer of Wisconsin's rankings,  and provide guidance about where we need to go and how to get there.

Unfortunately, more often than not, the reports show Wisconsin’s performance to be less than sub-par.

There is some good news to share. Competitive Wisconsin, Inc. (CWI) is a nonpartisan group of state agriculture, business, education and labor leaders. The Wisconsin Taxpayers Alliance (WTA) has prepared for CWI an annual report charting Wisconsin in 33 separate benchmarks. The report, "Measuring Success: Benchmarks for a Competitive Wisconsin," does offer some positive elements.

High school graduation rates increased during 2007 and remain above the U.S. average. Also on the rise, the percentage of Wisconsin’s 25-or-older population with at least a bachelor’s degree, increasing to 25.4 percent.

The number of doctoral degrees earned in science, engineering, computer sciences, and mathematics increased almost 16 percent during 2006.

Exports continue to be strong. As a percentage of output, exports rose more than 12 percentage points during the five years ending in 2007. Venture capital also showed signs of improvement.

During 2007, 8.2 percent of Wisconsinites were uninsured, compared to 15.3 percent nationally. Wisconsin’s uninsured rate was lowest in the region and the third lowest in the U.S. So why do we need state government health care?

That is the good news. Like any report of this nature, there is bad news to report.

Per capita personal income still trails the nation, by a full six percent.

The number of private businesses in the state is down for the second straight year.

Energy costs continue to increase.

Violent crime is up.  So why does Governor Doyle want to release more felons?

WISTAX has more details.

Rich states, poor states

Business, State budget, Taxes

Another economic report card, another horrible ranking for the state of Wisconsin.

The American Legislative Exchange Council (ALEC) has released its 2009 edition of “Rich states, poor states” that ranks all 50 states on their economic policies and performance, and also forecasts the states best equipped to rebound from the rough economy.

Wisconsin has the tenth worst economic performance ranking, dropping 11 spots from last year, and ranks #27 for its economic outlook (A property tax burden ranking of #42).

A press release from ALEC about the report says, “(It) shows how the federal bailout of the states may simply encourage out-of-control spending by states, which is up 124 percent over the last 10 years, without requiring them to make the tough decisions needed to bring about financial stability.”

Co-author of the report and highly acclaimed economist Dr. Arthur B. Laffer said, “States cannot tax their way into prosperity.”

One of the report’s conclusions:

As budget problems become more severe, states must utilize every cost-saving measure possible to avoid economically damaging tax hikes. Increasing taxes during the current downturn is a non-starter for states that wish to remain competitive. Instead, we hope states will use their current financial problems to put their fiscal houses in order and say no to profligate spending and irresponsible budget practices, which have caused many of the current difficulties.

As lawmakers return to session in 2009, many will be faced with a budget crisis. A handout from Washington, D.C., might seem to help in the short-term, but as many seem to overlook, dollars from Washington rarely come without costly strings attached. Furthermore, a federal bailout would do nothing to address the fundamental problem of a decade’s worth of state overspending. If anything good comes out of the budget problems in the states, maybe it will highlight the key to good budgeting: having the ability to say ‘no.’ Hopefully the next time we face an economic downturn, states will have policies in place to avoid another crisis of their own making.”

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Thank you, Wisconsin business leaders


Thank you for appearing and testifying at the WISCONSIN JOBS NOW Task Force meeting Monday, March 23, 2009 at BioResearch Inc. in Brown Deer.

As I expected, you brought a wealth of expertise and I was extremely impressed with your contributions.  The insight and personal experiences you shared will be valuable. Your input is expected to be incorporated into a report of recommendations to the Legislature to create jobs and truly stimulate our economy.

Again, thank you for your heartfelt testimony at the WISCONSIN JOBS NOW Task Force meeting, and for all you do every day to make significant contributions to our economy and quality of life.

Wisconsin businesspeople continue to voice concerns


The third meeting of the WISCONSIN JOBS NOW TASK FORCE was held Monday in Eau Claire. About 50 businesspeople attended to discuss their concerns about Wisconsin’s business climate, according to the Eau Claire Leader-Telegram. 

Here is my blog about last week’s task force meeting in Brown Deer and the Green Bay Press Gazette’s coverage of the first meeting in Howard.

Is Wisconsin good for business? Business leaders speak out


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