AFT-Wisconsin joined two government watchdog groups in a press conference Jan. 13 at the Capitol in Madison to denounce Gov. Scott Walker's proposal to privatize the state Commerce Department.
Walker announced the plan to "transform" the Commerce Department into the Wisconsin Economic Development Corporation on Jan. 6. He described the corporation as a public-private agency "whose sole mission is to promote economic growth and create jobs." The governor's proposal has been introduced as Senate Bill 6.
"I'm here today because I'm gravely concerned about the future of public service in our state," said AFT-Wisconsin president Bryan Kennedy, noting that the department oversees "many important regulatory functions, including building codes, housing assistance, oil storage tanks and licensing of certain professional trades."
Kennedy, shown speaking above, discussed the myriad of issues privatization poses, including the loss of accountability to taxpayers. "Those Commerce employees who are not fired will be removed from the civil service," he said. "This deals an especially regressive blow to ethics in state government. The civil service was created to prevent graft and corruption of public employees. When positions are removed from the civil service, it opens the door for employees to be hired or fired as political favors.
"Because the Department of Commerce is responsible for distributing taxpayer funds, it is especially important that those working in the agency have civil service protections to safeguard against this kind of fraud."
AFT-Wisconsin's concerns are substantiated by a new report, "Public-Private Power Grab: The Risks in Privatizing State Economic Development Agencies." The report was released Jan. 12 by Good Jobs First, a Washington, D.C.-based national policy resource center. Philip Mattera, research director of Good Jobs First and principal author of the report, joined Kennedy and Robert Kraig, executive director of Citizen Action of Wisconsin, at the press conference.
"Rather than making economic development activities more effective, privatization is often little more than a power grab by governors and politically connected business interests," said Mattera.
The report examines outcomes in states where business recruitment functions have been transferred from the government to private entities. The result: misuse of taxpayer funds, including excessive executive bonuses; political interference; questionable subsidy awards; and conflicts of interest.
Currently, only seven states allow private entities to control their business recruitment functions. They are Florida, Indiana, Michigan, Rhode Island, Utah, Virginia and Wyoming.
The Wisconsin Department of Commerce employs about 340 state employees. AFT-Wisconsin represents about 100 of them, including IT professionals, auditors, scientists and program specialists. Following the press conference, AFT-Wisconsin's government relations director Scott Spector and Good Jobs First's Mattera testified before a joint state Assembly and Senate hearing on the proposal. [Kathy Nicholson/photo by Brent Nicastro]
January 13, 2011