Saturday, July 08, 2006

Sykes writes: Going, Going, Gone

Charlie Sykes released this post a few weeks ago. After seeing more jobs leave Kenosha yesterday, I thought it is time to show this article again-

WEDNESDAY, June 28, 2006, 10:52 a.m.


(Note: this column appears in CNI Newspapers.)
By Charles Sykes

Last year, there were 55 announcements of new manufacturing plants in Illinois; there were 72 in Michigan, 35 in Minnesota, and 34 in Iowa.

In Wisconsin, there was a grand total of five.

According to a report for Competitive Wisconsin released last month, Wisconsin lagged behind the rest of the Midwest across the board.

In 2005, there were 75 announcements by companies that they were expanding their mannufacturing operations in Illinois; 180 expansions announced in Michigan, 36 in Minnesota, and 64 in Iowa.

In Wisconsin? Six.

It actually gets worse. When announcements of other business investments and expansions are also included, Illinois saw 510 announcements of business expansion; Michigan 505; Minnesota 176, Iowa 135, and Wisconsin…a mere 15.

What’s wrong with this picture?

Start with high taxes. Add in a heavy-handed regulatory climate, a lawsuit-happy legal climate, a lack of skilled workers, failed urban school systems, Milwaukee’s high crime rate, a welfare state mentality, and a dysfunctional political system and you have all the ingredients of economic decline.

The news that one of the state’s largest software companies, RedPrairie, was thinking of moving out of state should have served as a wakeup call last week. Instead, local officials did what they do best these days: they reached for the snooze alarm.

Quick: name the one political leader in the state would impress a corporate executive thinking of moving here? Jim “Pay for Play” Doyle? Lee “Ethics Don’t Apply to Me” Holloway? Tom “What Do I Do Now” Barrett? The leaders of the Milwaukee Common Council? Local legislators?

RedPrairie CEO John Jazwiec was blunt when he called taxes the “5,000 pound” elephant in the room for businesses making location decisions. While business taxes are relatively low in Wisconsin, the crushing weight of individual income, sales, and property taxes makes it harder to recruit executive talent here.

And when prospective employees check out the area what do they see? A new study says that Wisconsin continues to have the sixth highest tax burden in the country and the highst combination of income, sales, and property taxes in the Midwest. And how do local politicians react? By killing a Taxpayer Protection Amendment, and by proposing dueling sales tax hikes.

While surrounding states vie with one another in making themselves more friendly to business, Wisconsin politicians debate ways to grow the public sector and protect the perks and privileges of government workers. Meanwhile proposals like Pabst City are killed while growing companies like BuySeasons are driven out of town by ankle-biting politicians.

The impact of all of this is no longer theoretical. Both money and jobs are increasingly mobile, so if there is no compelling reason to move or stay here, they will both go elsewhere – and are. Unfortunately, a political culture stuck in the 1960s and a union mentality that’s a throwback to the 1930s isn’t likely to turn that around.

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