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What are the costs of ‘job creation’?

January 31, 2010

In a speech of nearly 4,800 words, Gov. Jim Doyle used the word “jobs” 27 times Tuesday night in his final State of the State. While Doyle’s obvious focus on jobs and the economy is a commendable, if predictable effort, it is important to take an objective look at the current state of the economy in the state of Wisconsin.

One of the biggest problems in doing so, however, is the contradictory nature of the Governor’s speech and that of 2010 Republican candidate Scott Walker. Whereas Doyle suggests tax credits have made Wisconsin an appealing place for companies to move their operations, Walker suggested in his speech “by almost any measure, Wisconsin is no longer considered a good place to do business.”

So, the question then remains whether Doyle or Walker is right. According to Walker, the state of Wisconsin has lost 160,000 jobs in the past two years. Doyle, on the other hand, points to companies like Mercury Marine, which opted to remain in Wisconsin despite the economic hardships it was facing, keeping thousands of jobs in the state. Yet Doyle’s use of the term “thousands” is far less specific and therefore much less convincing than Walker’s figure of 160,000 jobs.

Considering Doyle took the “victory lap” approach to his final State of the State speech and Walker currently is seeking the office of governor, it’s quite possible that they’re both right.

Doyle simply left out those things that shine a negative light on his time in office. Walker took those same things and used them to his advantage, making Doyle’s accomplishments as governor look far less impressive.

However you look at it, though, the state of the economy — which was the title of Walker’s speech — remains poor at best. Instead of improving the situation, the political rhetoric between Doyle and Walker has done nothing more than confuse the citizens of Wisconsin.

Where the two agree, though, is that Wisconsin needs to create more jobs. How they expect to do so, however, differs quite greatly. Whereas Doyle wants to use the Clean Energy Jobs Act, the CORE Jobs Act and global warming legislation to add thousands of jobs, Walker believes reducing tax rates in Wisconsin is the only true way to fix the state of the economy.

According to a study by the Wisconsin Policy Research Institute — which also was cited in Walker’s speech — more than 43,000 jobs could be lost as a result of the “expensive policies and regulations” favored by the Governor. Walker also added that another study says the price of gasoline could rise by 61 cents per gallon as well, on top of the current state average of $2.636 per gallon.

If Walker and the studies he cites are correct, Doyle’s policies are simply irresponsible and could prove to make the Wisconsin economy even worse than it is currently. According to the same study by the WPRI, global warming legislation would reduce annual wages by $1.6 billion, and disposable income would decrease by $1,012 per capita.

Wisconsin has already lost 160,000 “high-wage” manufacturing jobs since 2000 and such global warming legislation as Doyle has proposed would continue such a trend. The paper manufacturing sector in particular would suffer greatly from Doyle’s proposed legislation. An additional 3,496 jobs would be lost in the paper industry and investment would drop by $1.8 million by 2020 if the 12 Task Force policies were implemented, according to a letter signed by 23 business groups expressing concern with the legislation.

Doyle’s speech advocated job creation. Taking jobs from one sector and moving them to another is not, however, truly job creation. In fact, the reality of Doyle’s favored job creation legislation proposals almost certainly includes significant job loss.

If Doyle truly wants to create more jobs, he should focus on Wisconsin’s current industries rather than adding news jobs in new industries that replace those pre-existing jobs.

Categories: Uncategorized
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