Walker’s Plot to Plunder Pensions: It’s in the Budget!

This article continues our discovery process of the ‘behind the text’ operations of Governor Walkers Special Session SB 11 Budget Bill. To summarize the previous articles, Scott Walker's very divisive Budget Bill creates a new entity to replace the Department of Commerce. He refers to the new authority as the “Wisconsin Economic Development Corporation” (WEDC). At present, WEDC does not exist according to Wisconsin State records. What does exist is Wisconsin Economic Development Association, Inc (WEDA Inc).

With this in mind we took another look at the “shock doctrine” Governor Walker and his GOP lapdogs are introducing as legislature, a laughable joke on the entire governmental body if it were even remotely funny.

What we found was truly shocking and difficult to unravel although, I submit, Scott Walker has done a fine job of keeping everyone guessing what is going to come next, just when you think you have seen it all, we discover something even more outrageous.

In 2009, roughly half of the state employee’s pension fund’s total assets were managed by state employees, who were paid a total of $28.4 million for their work. In addition, outside Wall Street professionals were paid $194.7 million to manage the other part of the fund's assets. Cutting Wall Street pay, or simply moving more fund management in-house, could easily generate the $30 million in new taxes Walker wants to assess on state employees.

Make no mistake, as reported on the State of Wisconsin Investment Board website, the fund is 100% funded. I think we can conclude that the Department of Employee Trust Funds have been doing something right. And what Corporation that has accounting and investment interests would like to get in on that now $200 million piece of “outside Wall Street professionals” investing pie?

If that isn’t alarming enough, let’s take a look at how Walker intends on funding the portion of state’s obligation to the pension fund? By transferring the increased state employee contributions mandated by his budget bill into the general fund to pay for health care benefits! WHAT?! Transferring pension fund monies contributed by employees into the general fund! BTW, what “reserve accounts? Let’s keep in mind this is a bill that transfers money from the general fund into a new corporation not governed by the state otherwise known as WEDA?!!!

“This bill requires the secretary of employee trust funds to allocate $28,000,000, from reserve accounts established in the public employee trust fund for group health and pharmacy benefits for state employees, to reduce employer costs for providing group health insurance for state employees for the period beginning on July 1, 2011, and ending on December 31, 2011”

As Kirsten Emery reports:

On to Page Three of Governor Walker’s Budget Bill, third paragraph from the top, there is very interesting language that leads to the very important question for Governor Walker. The paragraph mandates that a study of the existing Wisconsin Retirement System be performed and it must “specifically address establishing a defined contribution plan as an option for WRS participating employees” and the deadline for completing this study is June 30, 2012. I don’t think that Walker would be adding retirement benefits for workers - so I am wondering if the Republican Governors that are trying to get rid of collective bargaining of retirement benefits, so that they can terminate the existing plans and recover excess assets for their state balance sheets.

If Governor Walker’s bill passes, and collective bargaining of retirement benefits is eliminated, then next year Governor Walker can decide it is in Wisconsin’s best interests to get rid of the existing plan and replace it with something less valuable for the employees. And the employees would have no say and no one can keep Walker from raiding your retirement savings.

This is just one example of Scott Walker and his cronies funneling money from the state budget to their special interest groups. The budget deficit has been created by Governor Walker, just as he did in Milwaukee County, and he will leave a skeleton of a Government, unable to function with no revenues, no Secretary of State, no democracy, and no republic. This budget bill, and every other bill introduced by the GOP’s and signed by Walker, forward his agenda to give state revenues to the corporations who now oversee government departments that previously served the people. After Walker is done the people will be serving the new Corporation: Wisconsin, Inc.

Our tax money is being handed over to the likes of Koch Industries, and we will be rendered powerless because the people will have lost their bargaining right – their voice in government. The Corporations, getting deeper and deeper pockets, will continue their reign of terror, literally enslaving the taxpaying workers of the state.