Cutting funding for educational institutions like Madison Area Technical College, in exchange for corporate tax breaks, is a short-term budget fix that will negatively affect local economies and have long-term consequences.

Wisconsin’s technical college system is a crucial element to our state’s economic health.  It trains a more productive and efficient work force, creates jobs, and takes pressure off social welfare programs.

Limiting the amount of students who are able to attend and graduate from college, means limiting the amount of taxable revenue.

Madison College students are local and state taxpayers who continue to pay taxes after graduation.  According to the Madison College Graduate Employment report, 96 percent of graduates work in Wisconsin.

Since graduates generally earn higher wages than people who don’t obtain post-secondary education, they often pay more in taxes. For example, 2006 graduates earned $2.1 billion more than they would with just a high school diploma.

Madison College graduates who stay in the state also contribute to local economies by shopping at local businesses. Without the added income that comes from having a degree, people will have less money to spend.

If Gov. Scott Walker wants to support small business in this state, why is he trying to cut funding to the educational institutions that are vital to their survival?

Every year colleges create new jobs in teaching and maintenance. The Madison College service area receives approximately $99.8 million in net added income each year due to payroll and operations spending at the college.

Under the new Madison College budget reduction proposal, which resulted from cuts in state funding, most faculty vacancies will not be filled in order to save money.  Also, student help positions could be turned into unpaid internships or discarded all together.

Though this is often overlooked, colleges also offer programs to support and educate some of the most vulnerable people of our society including dislocated workers and prisoners.  Through education and support programs, colleges in the Wisconsin Technical College System reduced welfare, unemployment and crime, saving the public some $4.3 million per year, according to Economic Modeling Specialists Inc.

Colleges are a good investment for Wisconsin.  When funding is taken away from education and given to big business in the form of tax breaks it does not to bolster local economies or create significant job growth.

“Increasing the after-tax income of businesses typically does not create an incentive for them to spend more on labor or to produce more because production depends on the ability to sell output,” according to Jane Gravelle’s 2008 report for the Congressional Research Service.

Corporate tax rate cuts are one of the least effective of all tax and spending options for stimulating the economy according to Mark Zandi, chief economist of Moody’s Analytics. In one report Zandi estimated that every dollar spent on these tax cuts would only generate 30 cents in economic demand.

In contrast, for every dollar invested in the state technical college system, district taxpayers get a return of $3.62, according to a report from the Wisconsin Taxpayers Alliance in April 2007.  This has an annual impact of about $7 billion on the state’s economy.

Despite being a far better investment for the future, the governor continues to push for big business rather than education.

One of Walker’s arguments in support of his budget plan is that everyone should share the burden of repairing the state’s budget deficit.

Then why is it that around two thirds of corporations in Wisconsin do not pay income tax?  If Wisconsin corporations were taxed at a median level, it would generate an additional $1 billion.  This would more than account for the $1 billion being cut from state funding for education in Walker’s proposed biennium budget.

Walker’s cuts to education might help solve the deficit in the short term, but it does nothing to improve local economies in the future.  For this reason, we oppose any and all attempts to cut funding for Madison College and any other educational institution around the state.  We demand that everyone, including corporations, pay their fair share of Wisconsin taxes to solve our state’s budget deficit.