Brian Dake

On Thursday, President Joe Biden unveiled his new $6.8 trillion budget. In addition to more military spending, the White House maintains it will cut nearly $3 trillion from the deficit over the next decade. Taxes would also go up on the rich, in part, to fund new social programs for the middle and lower class.

His proposal falls into four main categories: deficit reduction, lower costs for families, protecting and strengthening Medicare and Social Security, and investing in America.

Republicans say it’s unnecessary to raise taxes as the president has suggested. The key, they say, is to cut spending.

“If you look at the revenue that’s coming into America today, it’s higher than any 50-year average. But our expenses are much higher and if you look since (Biden’s) been in office, the added $6 trillion, the 30 percent increase in discretionary spending, just in the last four years, that has been a real challenge and I think that’s where the real problem lies,” said House Speaker Kevin McCarthy when asked Wednesday about the president’s upcoming budget announcement.

As Congress argues over how to bring down the national debt, both sides agree something must be done. U.S. debt currently sits at $32 trillion and is expected to reach $50 trillion by 2030.

“In the next 10 years, Americans will pay $10.5 trillion in interest on our debt. Now to put that in perspective, since 1940 until today, America has only paid $9 trillion in interest. So the next 10 years, we’ll pay more than we paid the last 80 years,” said McCarthy.

Wisconsin’s top Republican said Wednesday that a plan put forward by Democratic Gov. Tony Evers and the Milwaukee Brewers to spend nearly $300 million in taxpayer money on improvements to the stadium where the team plays was likely dead in the GOP-controlled Legislature.

But Assembly Speaker Robin Vos said he hoped Republicans could devise a better deal that would look for a commitment from the team to remain in Milwaukee longer and not rely as heavily on money from a one-time budget surplus.

Under the Evers plan, in exchange for the state spending $290 million on repairs, the Brewers’ lease would be extended by 13 years, through 2043.

“I’m not sure the amount of time he’s asking the team to stay here is correct,” Vos told reporters. “I think the deal that he cut is not a very good one for the taxpayer.”

Earlier Wednesday, a coalition of Wisconsin business, tourism and health care leaders, former office holders and others announced that it is working to find a bipartisan solution to keep the Brewers in the state “for the next generation,” said the group’s leader, Omar Shaikh, a Milwaukee-area restaurant owner and developer.

 The Federal Reserve could increase the size of its interest rate hikes and raise borrowing costs to higher levels than previously projected if evidence continues to point to a robust economy and persistently high inflation, Chair Jerome Powell told a Senate panel Tuesday.

“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Powell testified to the Senate Banking Committee. “If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.”

Powell’s comments reflect a sharp change in the economic outlook since the Fed’s most recent policy meeting in early February. At that meeting, the central bank raised its key rate by just a quarter-point, downshifting after a half-point rise in December and four three-quarter-point hikes before that.

The Fed chair’s remarks Tuesday raised the real possibility that the Fed will increase its benchmark rate by a half-percentage point at its next meeting March 21-22. Over the past year, the central bank has raised its key rate, which affects many consumer and business loans, eight times.

At their forthcoming meeting, Fed officials will also issue updated forecasts for how high they expect their benchmark rate to ultimately reach. In December, they forecast that it would reach about 5.1% later this year. Powell’s latest remarks suggested that the Fed could raise it even higher. Futures pricing indicates that investors now expect it to rise a half-point further, to 5.6%.

State officials say Wisconsin has seen an upward trend in child labor complaints since 2018, while the U.S. Labor Department says its seen a 69 percent increase in cases of children being illegally employed during the same period.

The federal government is currently investigating over 600 cases of possible child labor exploitation. In the last fiscal year alone, the Department of Labor identified 835 companies operating in violation of child labor laws affecting 3,800 children, and saw a 26 percent increase in minors employed in hazardous occupations.

Violations can vary from children working more hours than allowed under law, to working with prohibited equipment or working in industries that they shouldn’t be.

Federal officials last week announced new efforts to combat the rise in child labor exploitation through a partnership between the U.S. Department of Labor and U.S. Department of Health and Human Services. They also called on Congress to increase financial penalties for child labor violations and to boost funding for enforcement of child labor laws.

Wisconsin food, forestry and agriculture product exports set a record in 2022, according to U.S. Census trade data. Exports were shipped to 142 countries totaling nearly $4.22 billion, a 7% increase from the previous record in 2021.

U.S. Census data shows that d​airy product exports totaled $617 million, up 32% from 2021, the highest level on record and more than $100 million above the previous record year in 2014. Crop products, including grains, wood and vegetables increased more than 5% to $2.82 billion, a 10-year high. Meat products declined 2% to $782 million.​In total, U.S. agricultural exports exceeded $220 billion in 2022, up 10% from the year prior. Wisconsin now ranks 12th in the nation for agricultural exports.

“This record-breaking year again presents an opportunity to strengthen our state as a leader in agricultural exports,” said DATCP Secretary Randy Romanski. “Building off of last year, this momentum, the investments of Governor Evers, and the work of DATCP’s International Agribusiness Center positions Wisconsin agribusinesses well for the next year.”

The latest release of U.S. Census data shows that post-pandemic demand is driving export growth in several markets as logistics challenges decrease. Wisconsin’s top five markets, making up more than two-thirds of total exports, are Canada, China, Mexico, Korea and Japan. Canada, Mexico and Korea showed double-digit increases in 2022, while Japan remained unchanged from 2021.

University of Wisconsin System President Jay Rothman will propose a 5% tuition increase for the next academic year, he told the state Assembly’s higher education committee Thursday.

Rothman will present the idea later this month to members of the Board of Regents, who will weigh whether to implement the change. If passed, it would be the first time the UW System has raised tuition for in-state undergraduates since 2013.

Republican lawmakers passed legislation a decade ago freezing tuition for UW System state students. While the Legislature returned tuition-setting authority to the regents in 2021, the board chose to keep the freeze in place for the 2022-23 school year, instead relying on federal pandemic relief funds to cover costs.

A tuition increase would bring in about $38 million per year in revenue, Rothman estimated.

The 5% increase would be under last year’s inflation rate, Rothman said. He added that he’s “extraordinarily sensitive” to ensuring that UW System tuition remains affordable, citing the new Wisconsin Tuition Promise, which will waive the costs of tuition and fees that remain after receiving financial aid for in-state students from low-income families.

It currently costs in-state undergraduates about $8,000 to $11,000 to attend a four-year UW System school, without accounting for additional fees and living expenses. UW-Madison has the highest resident tuition among the system’s 13 universities.

Wisconsin Republican legislative leaders downplayed the state’s record budget surplus Wednesday, even as Democratic Gov. Tony Evers has pushed for massive spending increases on K-12 education, tax cuts and funding for local governments.

Assembly Speaker Robin Vos cautioned that much of the state’s projected $7 billion surplus is one-time money that he said shouldn’t be used to fund new programs or ongoing expenses. Evers has proposed a range of uses for the money, from subsidizing repairs at the Milwaukee Brewers’ stadium to creating a three-month paid leave program for most workers.

“We do not have anywhere near the money that Gov. Evers spoke about yesterday,” Vos said at a Wisconsin Counties Association event as he tried to temper expectations for what local governments would receive in the budget.

At the same event on Tuesday, Evers promised tax cuts for the middle class and additional funding for local governments — plans that Vos said relied on “phony math.”

Vos said Republicans would tie more funding for local governments to requirements on how it could be spent.

He and Republican Senate Majority Leader Devin LeMahieu, who together lead the GOP-controlled Legislature, advocated for using the surplus to enact tax cuts for payers at all income levels. Co-chairs of the Legislature’s powerful budget-writing committee said Tuesday that LeMahieu’s plan for a flat income tax rate was unlikely to be included in the budget, but Republicans view such a tax as a long-term goal.

Vos cited estimates that the state’s recurring revenue will increase by $1.2 billion over the next two years. He told county officials that about 75% of that money would be needed to continue funding Medicaid programs and wage increases for prison guards that Evers supported with federal pandemic aid.

Democratic Gov. Tony Evers on Tuesday proposed spending $3.8 billion on building projects in 28 counties around the state, with nearly half directed toward work across the University of Wisconsin System.

The plan will first go to the state building commission on March 23 for consideration, but it would ultimately need the approval of the Republican-controlled Legislature.

Republican Rep. Mark Born, co-chair of the Legislature’s budget committee, accused Evers of proposing “massive spending and unrealistic growth.” He said the Legislature’s plan, which is likely to be finalized in June, will prioritize projects that “ensure we’re in a strong position for the future.”

Unlike in previous years, which relied heavily on borrowing to pay for the projects, Evers this time proposed paying for about half of the work in cash, citing the state’s record-high budget surplus of about $7 billion.

Evers called for spending $1.8 billion on projects at UW campuses. That includes $347 million to demolish and replace the engineering building on the UW-Madison campus; $231 million to demolish the science building at UW-Eau Claire and build a new facility to house several programs; $182 million to demolish and replace the science building at UW-La Crosse, and $169 million to partially demolish, renovate and build a new art building at UW-Madison.

Other proposed projects include $41 million in fiberoptic upgrades at the state Capitol to improve cellular service; $225 million for health services facilities; an additional $60 million for the already approved construction of a new state history museum near the Capitol; and $84 million for improvements at a variety of Wisconsin National Guard facilities.

There are a host of local projects, including funding for the Milwaukee Iron District, Woodman’s Sports and Convention Center in Janesville, Green Bay National Railroad Museum, Marquette University School of Dentistry and the Door County Peninsula Players Theatre.

Hundreds of new companies have been founded in Wisconsin since the start of the COVID-19 pandemic. Now the state is getting nearly $80 million to support those startups and small businesses.

Governor Tony Evers is allocating $50 million of those funds to the Wisconsin Economic Development Corporation, or WEDC, which plans to create a new Wisconsin Investment Fund. The money comes from the federal State Small Business Credit Initiative through the American Rescue Plan Act.

The Evers administration will also allocate the money to some of WEDC’s existing programs. Its Technology Development Loan program will receive $8 million. The Capital Catalyst program, which focuses on supporting nonprofit lenders, will get an additional $6 million.

About 500 new businesses have formed on average each month in the state since the summer of 2020, but leaders still face a tight labor market and inflation.

The WEDC is also working with the Wisconsin Housing Economic Development Authority, which received $15 million to improve access to capital and credit for small businesses that receive microloans from Community Development Financial Institutions.

U.S. consumer spending rebounded sharply in January amid strong income growth, while inflation accelerated, which could add to financial markets fears that the Federal Reserve could continue raising interest rates through summer.

The personal consumption expenditures (PCE) price index, tracked by the Federal Reserve for monetary policy, shot up 0.6% last month after gaining 0.2% in December. In the 12 months through January, the PCE price index accelerated 5.4% after rising 5.3% in December.

Excluding the volatile food and energy components, the PCE price index increased 0.6% after climbing 0.4% in December. The so-called core PCE price index increased 4.7% on a year-on-year basis in January after advancing 4.6% in December.