The Federal Recovery Project in Wisconsnin
The Federal Recovery Act stimulus was an $800 billion safety net for communities across the United States facing economic disaster. Risky investments by multinational banking systems created the most severe financial catastrophe since the great depression. The federal aid directed billions in tax cuts and aid to individuals, kept local government systems running so people and businesses had basic services – public safety, transportation, sanitation, education and sent funds to reboot the economy.
IWF is working with Wisconsin Voices, local governments, school districts, labor unions and community groups across the state to keep people informed on how the stimulus has helped our state. We are working to mobilize support for more federal aid so our schools can remain effective, our cities safe, our counties capable of sustaining vital systems for Wisconsin families and our economy supported through roads, transport, loans and skilled workers until the recession is fully defeated.
Communities across Wisconsin hold meetings on
Recovery Act impact and 2011 funding cliff
OSHKOSH
Citizens for a Strong Oshkosh (CSO) held a successful community forum on May 20 at the Oshkosh Public Library to explain the benefits of Stimulus dollars in the community. Local leaders also alerted people to the serious revenue challenges that schools, local and state government will face without further Stimulus funds.
Speakers described how $214 million of Stimulus funds came into in Oshkosh and Winnebago County and how they were used. The speakers were:
- Pastor Tom Willadsen of Citizens for a Strong Oshkosh.
- Oshkosh City Manager Mark Rohloff
- Interim Oshkosh School Superintendent Bette Lang
- Winnebago County Executive Mark Harris
- UW-Oshkosh Professor of Economics Kevin McGee
- Becky Lund, a C.P.A. with Schenck Business Solutions
Links to video and news:
- The entire May 20 community presentation is on Channel 10’s website
- A three-minute video starring CSO's Tom Willadsen, on location at projects throughout Oshkosh
- Fox News 11 Coverage of the event
See more about the May, 2010 meeting in Oshkosh
GREEN BAY
On July 12, 2010 the UW-Green Bay Center for Public Affairs, JOSHUA (congregational organizing for justice), the League of Women Voters and IWF held a community meeting at the Neville Public Museum in Green Bay. Presenters were: Tom Hinz, Brown County Executive, Jim Schmitt, Green Bay Mayor, Eric Ness, Wisconsin Small Business Administration Director and Jean Marsch, Green Bay School Board President.
They talked about why Stimulus funding was necessary, how the dollars were used and what happens next. They also showed a video produced by JOSHUA on how Recovery Act funding helped Green Bay schools, the Oneida Nation, the Sexual Assault Center and Family Services of Northeast Wisconsin. Turnout was high and there was significant media coverage of the meeting.
EAU CLAIRE
On August 4, 2010, the Alliance for Strong Communities in Greater Eau Claire held a community meeting on the Recovery Act funding at the Royal Credit Union. City, county and school district officials in partnership with leaders from AFSCME, AFT and the Retired Teachers gave community members information on how Stimulus funds were used, the looming local funding crisis, and possible strategies for securing more federal aid in the future. Participants had small group discussions to consider the presentations and decide what they felt was the best course of action for Eau Claire. There was near unanimous agreement on the need for more federal aid and the majority felt higher taxes on investors and the wealthiest people would be an appropriate way to raise the needed revenue.
MILWAUKEE
Congresswoman Gwen Moore joined community activists and leaders from the Milwaukee area to call for more federal aid to save and create jobs. On June 3, Citizen Action, Good Jobs and Livable Neighborhoods, and many other groups held a press conference to call on federal lawmakers for investments in job protection and creation in Milwaukee and across the state. Many communities are struggling with double digit unemployment, cuts in vital services and a large population of families in crisis. Greeting Rep. Moore is Tina Carr, Director of the Tina N Tots Childrens Academy who used Stimulus loan funds to make her Center safer for the children enrolled in her program.
Note to Tea Party -- the Federal Stimulus gave us tax cuts !!!! 
In Wisconsin (and every other state), tax cuts from the federal stimulus have been raining cats and dogs. Thanks to the federal stimulus, Wisconsin individuals, families and businesses are seeing a $5.2 billion tax cut over the 2009-2010 tax periods. Who's getting these tax cuts? EVERYBODY!
Each of Wisconsin’s 2.2 million working families or individuals is receiving a tax cut averaging $506 per year in 2009 and 2010 through the Making Work Pay credit. That’s enough to pay for a month’s worth of groceries, and it amounts to a statewide tax cut worth $2.3 billion. And there are many more tax cuts and direct aid that benefit diverse groups of citizens and companies.
While banks have kept a tight hold on their funds, the federal government has been pumping money into the economy consistently since February 2009 through the stimulus—the American Recovery and Reinvestment Act (ARRA)—to prevent an economic collapse.
This recession has been painful for the people of Wisconsin who have lost jobs, pensions, home values and, sometimes, hope. The federal government has been a constant target of anger and frustration because people want to blame someone, and the bankers who created this catastrophe have faded back into their skyscrapers. However, for those who want government to cut taxes and put money into people’s pockets to jumpstart the economy: Open your eyes. Your wish has already been granted.
See: Milwaukee Journal Sentinel article
Recession Continues to Batter State Budgets;
State Responses Could Slow Recovery
(Center on Budget and Policy Priorities)
The worst recession since the 1930s has caused the steepest decline in state tax receipts on record. As a result, even after making very deep cuts, states continue to face large budget gaps. New shortfalls have opened up in the budgets of at least 41 states for the current fiscal year (FY 2010, which began July 1 in most states). In addition, initial indications are that states will face shortfalls as big as or bigger than they faced this year in the upcoming 2011 fiscal year. States will continue to struggle to find the revenue needed to support critical public services for a number of years.
New gaps in 2010 budgets. An increasing number of states are struggling to keep their 2010 budgets in balance. Because revenues have fallen short of projections, mid-year shortfalls have opened up in 41 states — some of which have already addressed them — totaling $38 billion or 7 percent of these budgets. These new shortfalls are in addition to the gaps states closed when adopting their fiscal year 2010 budgets earlier this year. Counting both initial and mid-year shortfalls, 48 states have addressed or still face such shortfalls in their budgets for fiscal year 2010, totaling $196 billion or 29 percent of state budgets — the largest gaps on record.
Additional large gaps for 2011. States’ fiscal problems will continue into the next fiscal year and likely beyond. Fiscal year 2011 gaps — both those still open and those already addressed — total $103 billion or 17 percent of budgets for the 42 states that have estimated the size of these gaps. These totals are likely to grow as revenues continue to deteriorate, and may well exceed $180 billion.
Combined gaps of $375 billion for 2010 and 2011. These numbers suggest that when all is said and done, states will have dealt with a total budget shortfall of some $375 billion for 2010 and 2011. (This includes both gaps already closed and gaps projected for the future.
The Consequences of Shortfalls
In states facing budget gaps, the consequences are severe in many cases — for residents as well as the economy. As the 2009 fiscal year ended and states planned for 2010, budget difficulties have led at least 45 states to reduce services to their residents, including some of their most vulnerable families and individuals.
Over 30 states have raised taxes to at least some degree, in some cases quite significantly.
If revenue declines persist as expected in many states, additional spending and service cuts are likely. Already many states have taken actions to close mid-year budget shortfalls. The majority of the actions taken so far were spending cuts made by governors using their power to maintain budget balance. Budget cuts often are more severe later in a state fiscal crisis, after largely depleted reserves are no longer an option for closing deficits.
Expenditure cuts are problematic policies during an economic downturn because they reduce overall demand and can make the downturn deeper. When states cut spending, they lay off employees, cancel contracts with vendors, eliminate or lower payments to businesses and nonprofit organizations that provide direct services, and cut benefit payments to individuals. In all of these circumstances, the companies and organizations that would have received government payments have less money to spend on salaries and supplies, and individuals who would have received salaries or benefits have less money for consumption. This directly removes demand from the economy.