Wisconsin Legislature, Failing to Create Jobs, Opts to Punish the Unemployed

Jobless benefitsWisconsin's unemployed are being subject to a double attack by the state legislature. In the state that fell to 44th in the nation in job creation in March, a bill introduced to the Wisconsin State Assembly on May 24 would make it more difficult for jobless workers to collect unemployment benefits. Then, in what Representative Chris Taylor (D-Madison) called the "ultimate bait-and-switch," a hearing on that bill occurred at the same time as a meeting of the Joint Committee on Finance that passed yet more changes related to unemployment insurance, which critics called even more extreme than the first.

Governor Scott Walker promised during the 2010 campaign to create 250,000 jobs, but steep budget cuts and multiple tax breaks for the wealthiest Wisconsinites and corporations have placed Wisconsin consistently among worst performing states in Bureau of Labor Statistics rankings on new job creation. Even the U.S. Chamber of Commerce ranks Wisconsin 44th for overall economic performance and 50th for short-term job growth.

Bill Would Make Jobless Benefits More Difficult to Obtain

Assembly Bill 219/Senate Bill 200 would make a raft of changes to the state's unemployment insurance law. It would:

  • Allow the state to inspect and freeze private bank accounts in order to recover overpayments of unemployment insurance benefits;
  • Change the law so that, if someone is denied benefits after turning down a job offer, that person would remain ineligible until he or she finds a job earning six times the weekly benefit rate (current law requires four times that rate);
  • End the current extension of benefits beyond the normal expiration date if a person is taking vocational or basic education courses;
  • Make a person subject to identity theft liable if personal information is used to obtain unemployment benefits by someone unauthorized; and
  • Require any financial institutions that do business with the state of Wisconsin to disclose information about accounts held by people who owe money to the unemployment system so that the state could try to collect overpayments made as a result of administrative errors or computer malfunctions.

Representative Dan Knodl (R-Germantown) co-authored the bill. He told the Wisconsin State Journal, "This is to protect the workers and lessen the burden on employers who are paying all the bills." But Representative Christine Sinicki of Milwaukee, the ranking Democrat on the Assembly labor committee now considering the bill, said in a statement, "Republicans ... are kicking workers when they are down in a lagging economy that Republicans themselves created."

The punitive unemployment policy changes follow legislative action making food assistance harder to access in the state.

Finance Committee Approves Even More "Radical" Changes

As if that weren't enough, changes to unemployment policy approved by the Joint Committee on Finance (JCF) concurrent to the hearing on the Assembly bill on May 29 "not only kicks the state's unemployed while they're down, but potentially wrecks decades of cooperative policy making that involved employers and workers each step of the way," according to the Wisconsin State Employees Union AFSCME Council 24. That's because the changes in the Assembly bill were agreed to by the Unemployment Insurance Advisory Council (UIAC), a body including an equal number of labor and management representatives; but the changes approved by the JCF disregarded ignored UIAC recommendations and introduced far more extreme measures. The Progressive explains: "The two items of concern were an expanded definition of 'misconduct' as a way to deny workers benefits, and the removal of 'quit exceptions' from the list of circumstances in which a worker may terminate their employment and still receive unemployment insurance benefits."

After the measure passed the JCF on a party line vote, committee member Representative Jon Richards (D-Milwaukee) said the proposal may conflict with federal law and provides "seven new ways to get people kicked off unemployment insurance." Representative Cory Mason (D-Racine) asked, "When are we going to start talking about getting people back to work instead of kicking them when they're down?"

Few New Jobs, Less Accessible Benefits, but Tax Cuts for the Rich

The same week that the GOP introduced these punitive measures for the jobless, JCF member Representative Dale Kooyenga (R-Brookfield) proposed a new tax package that would largely benefit Wisconsin's very highest earners, according to the Wisconsin Budget Project. That's because more than a third of the proposed income tax cuts would go to the top five percent of earners (averaging $392,000 in income). It would also create a gaping hole in Wisconsin's next budget, making it harder to afford essential services, education, and the creation of more jobs. This follows a series of tax breaks enacted in the previous legislative session that benefited Wisconsin's wealthy.

"Beating up on Wisconsinites who are out of work isn't going to fix our economy and it won't trick the public into thinking Republicans are more reputable on job creation," Rep. Taylor said in a statement. "Republican legislators should focus on getting Wisconsin out of our job slump rather than treating unemployed Wisconsinites ... as public enemies."

For more information and details on these changes, see memo from Madison area attorney Victor Forberger here.