By “CJ” Szafir, Institute for Reforming Government
Ten years ago today, the Budget Repair Bill (aka Act 10) was signed into law, ushering in a new era of worker freedom in Wisconsin and transforming the policy and political landscape. Act 10, among other things, significantly restricted the ability for public unions to collectively bargain and increased pensions and healthcare contributions for public employees.
To mark the decade anniversary, here are 10 things about Act 10 you may have forgotten…
- Why: Then-Governor Scott Walker’s Democratic predecessor left him with a projected $3.6 billion budget shortfall, due to the expiration of federal stimulus dollars and an ongoing recession.
As Governor Walker explained in the Wall Street Journal last month, he had options to balance the budget – laying off more than 10,000 government employees, cutting billions from Medicaid, or raising taxes during a recession. Instead, he chose to cut state shared revenue while also giving local governments the tools they need to curb costs.
This likely prevented a pro-longed economic recession.
- Riots and protests: Over 100,000 people stormed Capitol Square in Madison to protest. At times, they turned dangerous. Words cannot do it justice – the videos from MacIver Institute do.
- The Senate was not easy. The Republican Senate caucus was dramatically different 10 years ago and less conservative as a whole. It was not a guarantee that Act 10 would have the votes. As Governor Walker said in a recent interview, per the Journal Sentinel:
“When I went in (the Assembly Republican caucus) and told them what we were going to do, it was like a scene out of ‘Braveheart.’ They wanted to lift me up on their shoulders and go out to battle,” Walker said in a recent interview. “When I went to the Senate caucus … it was like I had told them their puppy had died. A number of them were not keen on making that kind of dramatic change.”
- Billions in savings for taxpayers: Since 2011, Act 10 has saved taxpayers over $13 billion, according to the MacIver Institute.
- The sky didn’t fall on public education. A study from the Wisconsin Institute for Law & Liberty, which I co-authored, showed that Act 10 had little or no impact on student-teacher ratios, the number of licensed teachers, school district spending on teacher salaries, and teacher experience. Especially as Wisconsin compared to other states that didn’t enact collective bargaining reform.
Further analysis by WILL showed that districts that embraced Act 10 actually had an uptick in math test scores.
- But the sky did fall on public unions. It turns out, if given the choice, there were many public employees who did not want to be a member of the union. As noted by Wisconsin Public Radio, the share of Wisconsin workers as part of the union dropped from 14.2% to 8.7% in the last decade.
Given that union dues fund the teachers’ unions, the decline in members has a ripple effect. For example, the Wisconsin Education Association Council (WEAC), before Act 10, had 17 lobbyists. Today, just two. WEAC even had to downsize its Madison offices by selling its headquarters.
- New teacher marketplace: Before Act 10, teachers were compensated according to archaic collective bargaining agreements based upon seniority. Now there is a whole new teacher marketplace, where districts are competing over the best teachers. Stanford University economic researcher Barbara Biasi highlighted in a study how districts in Wisconsin, such as Green Bay, are trying harder to recruit and retain teachers who are best at improving student learning.
- Less unions because of the union certification election: A lesser-known provision of Act 10 requires all unions to hold a certification election, each year, of their members. If a majority of members do not vote “yes,” then the union is de-certified. According to Will Flanders of the Wisconsin Institute for Law & Liberty, this has contributed to the number of unions in Wisconsin declining by a third.
- Act 10 is here to stay. If anyone wants to restore collective bargaining and allow
healthcare and pension contributions and costs to increase, they must do one of the following: allow local governments to increase property taxes or allow the state to increase taxes to spend more on state shared revenue. It must be one or the other.
- The importance of bold state policy reforms. Act 10 launched a national movement, ushering in similar worker freedom efforts in Michigan, Iowa, Indiana, and other states. In the courts, we saw the landmark Janus decision that prohibits forcing public sector employees from paying union dues. These reforms have all been durable, withstanding the inevitable shifting political landscape.
Policymakers would be wise to remember the impact of Act 10, how it has reverberated across the country, and think about what comes next.