In what I could call an attempt to save face, Wisconsin Governor Scott Walker has deferred payment on the state’s debt at the cost of millions in additional interest.
Walker’s office is spinning this as “prudent fiscal management” but it’s really nothing more than a marketing scheme that will ultimately cost state taxpayers more money in interest payments.
The state was supposed to retire about $132 million in debt on May 1, according to the nonpartisan Legislative Fiscal Bureau. Instead it reduced that amount by $101 million, which will help the state end the current biennium on June 30, 2017, in the black. […]
“We have a proven track record of keeping the state’s fiscal house in order,” [Walker administration spokeswoman Laurel Patrick] said. “We continue to efficiently manage state resources and will end this biennium with a surplus.”
Of course there will be a momentary surplus if you don’t pay your bills on time.
The real story here is the state’s inability to meet its obligations even after cutting the University of Wisconsin system by over $250 million. Those cuts cannot accomplish their stated goal if they’re immediately counteracted by spending $250 million on a new basketball arena.
Spending cuts cannot keep pace with the cost of tax breaks and incentives the Walker administration has handed out to businesses that have not improved Wisconsin’s economy or created many, if any, jobs.
The Walker administration also deferred payment on the state’s debt at the end of the previous fiscal cycle.
The previous administration also deferred payment on the state’s debt several times, but unless I’m mistaken the public university system wasn’t slaughtered on behalf of the billionaire owners of a (bad) basketball team.