News of the Day

Addressing the Elephant in the Room on Organized Retail Crime

Over the last few months, the National Retail Federal (NRF) became the focus of various flawed narratives alleging the retail industry distorts retail theft data to drive public policy goals. NRF made a correction to an April 2023 report on organized retail crime (ORC), withdrawing a phrase that suggested ORC accounted for half of the overall inventory losses suffered by the retail industry in 2021.

It is a known fact that retailers are facing an increase in theft, crime and violence, much of it involving organized retail crime efforts to resell stolen merchandise back to consumers.

Quantifying the scope of ORC is a known challenge, as ORC is not a single event or act. ORC networks use shoplifting, break-ins, cargo theft and other criminal activities to obtain stolen goods to fund their enterprises.

Retailers large and small have differing resources and capabilities dedicated to investigating, tracking and analyzing events that may be tied to organized retail crime groups.

Retailers admit to underreporting shoplifting due to lack of police response, failure to arrest or prosecute, or when a retailer recovers the merchandise from the shoplifter.

Police department reporting of retail theft is also wildly inconsistent. Some departments may report it as shoplifting. Others may categorize these crimes as larceny, robbery or property crimes. And furthermore, some departments won’t even respond to shoplifting due to current procedures or response capabilities. At the time of an incident, a retailer or law enforcement agency may not know the theft is part of an organized retail crime effort until an investigation takes place. Law enforcement nationwide is short-staffed and under-resourced, and needs support from the federal government for these major cross-jurisdictional crimes.

A recently released study by the Council of Criminal Justice on shoplifting provided data from the perspective of law enforcement reporting. Within their report, the CCJ highlights similar limitations of data, including a statement that the data used within their report “almost uncertainly undercount total shoplifting.” Of course, certain media outlets even discounted this fact by publishing misleading narratives that retail theft is not a serious issue.

It’s fair to ask questions about the data and the true impact of these thefts and organized groups, but the problem with media coverage that focuses on the known data problems gives many critics an unwarranted excuse to downplay the seriousness of these crimes and delay efforts to address them.

Evidence is everywhere that retail crime is on the rise. Media outlets across the nation continue to report ongoing acts of widespread shoplifting. Law enforcement agencies continue to establish task forces and alliances focusing on organized retail crime. These same agencies are reporting apprehensions of repeat theft offenders and fencing operations involved in stealing and reselling stolen goods. Retailers continue to lock up more merchandise to deter and prevent theft, much to the dismay of legitimate customers who now have to wait for a store associate to unlock commonly stolen items.

Better data is absolutely part of the solution, but we should not delay acting on the obvious evidence of retail theft in our communities every day while arguing over the numbers.

It’s time for critics to stop dwelling on flawed, flashy inferences and focus on the facts. Instead, let’s prioritize addressing the flagrant disregard of law that threatens all retailers and weakens our communities.

 

Federal Appeals Court Hears Arguments from Bad River, Enbridge Regarding Pipeline Shutdown Order

A federal appeals court will hear oral arguments Thursday in a case that has a Canadian energy firm and a Lake Superior tribe fighting over the fate of an oil and gas pipeline running across northern Wisconsin.

The 70-year-old Line 5 operated by Enbridge, Inc. can carry up to 23 million gallons per day of light crude oil and natural gas liquids from Superior across northern Wisconsin and Michigan to Sarnia, Ontario.

Last year, a federal judge ordered Enbridge to pay $5.1 million for trespassing on lands owned by the Bad River Band of Lake Superior Chippewa. U.S. District Court Judge William Conley ruled the company must remove its Line 5 pipeline from those lands within three years.

The Bad River tribe wants the federal appeals court to order Enbridge to turn over profits from the continued operation of Line 5 and immediately stop trespassing on tribal lands.

Enbridge argues the company isn’t trespassing on lands with expired easements because the tribe signed a 1992 agreement that the pipeline would continue to operate until 2043 in exchange for $800,000.

 

 

Business Coalition Urges Wisconsin Lawmakers to Tackle Ever-Increasing Medical Costs in Worker’s Compensation System

Wisconsin Manufacturers & Commerce was joined by 32 other associations, including WIB, from across the state on Tuesday urging lawmakers to tackle ever-increasing medical costs in the worker’s compensation system.

“Wisconsin has among the highest medical costs for worker’s compensation in the nation…35% higher than the national median,” the letter reads. “The average cost per workers compensation claim in Wisconsin is $10,000 higher for health care cost than the average state.”

Forty-five other states have reined in costs by implementing a medical fee schedule. Wisconsin’s costs for professional health services outpace other midwestern states, including Michigan, Minnesota and Illinois, by more than double.

“The Worker’s Compensation Employers Coalition is in support of the adopting the WCAC fee schedule because it is a tested reform that almost every other state effectively uses to keep medical costs in check,” the letter continues. “Please support Wisconsin employers and bring worker’s compensation medical costs under control.”

Click here to read the full letter.

State Assembly Task Force on AI Pitches Five Proposed Laws

The Wisconsin lawmakers who’ve been studying artificial intelligence for the past six months are recommending five new laws in their recently released final report. The Speaker’s Task Force on Artificial Intelligence Chairman Rep. Nate Gustafson, R-Fox Crossing, said while AI has tremendous potential, there are also some real worries that come with new technology.

“We stand at the forefront of technological advancement and it is vital that we address the challenges and opportunities presented by AI,” Gustafson said. “This report represents an opportunity to ensure that Wisconsin remains a leader in responsible AI development, benefiting all sectors of our society.”

The report suggests three new laws that deal with “generative AI,” which can create new images, videos, and sounds.  Gustafson says lawmakers must create a new law to deal with AI-generated porn. “Specifically, this legislation prohibits conduct related to the possession of obscene material that contains a depiction of a purported child engaging in sexually explicit conduct,” the report states. There is also a suggestion for a law against AI generated revenge porn.

The task force is also recommending a new law to make sure AI is kept out of political commercials in Wisconsin.

“To address the use of AI-generated content in political advertisements, we recommend Assembly Bill 664, legislation that would establish disclosure requirements for certain political communications that contain ‘synthetic media,’” the report adds. “Additionally, the bill specifies particular disclosure language that must be provided in audio or video communications that contain [AI-generated] media.”

Another proposal would create a new state law for data protection, and another that would have the state track how AI is used in state government.

 

Federal Reserve Chair Says the United States Government is on an Unsustainable Fiscal Path

Federal Reserve Chair Jerome Powell said “the U.S. is on an unsustainable fiscal path” in a “60 Minutes” interview with Scott Pelley released Sunday.

“The U.S. federal government’s on an unsustainable fiscal path. And that just means that the debt is growing faster than the economy. So, it is unsustainable. I don’t think that’s at all controversial,” Powell said when asked if the national debt is a danger to the economy.

The U.S. national debt topped $34 trillion for the first time ever in early January, just over three months after surpassing the $33 trillion mark, according to data released by the U.S. Treasury.

Congress has punted on spending deadlines three times since the end of September as it grapples with how to fund the government amid tensions about the ballooning national debt.

Under the latest stopgap measure passed in January, funding for four federal agencies will expire on March 1. Funding for the rest of the government is set to run out on March 8.

President Biden and House Republicans faced off on the borrowing limit last spring, ultimately averting disaster days before the U.S. was set to default. But Fitch Ratings downgraded the U.S. credit rating from “AAA” to “AA+” in August, citing the increasing burden of the national debt and repeated partisan standoffs over the debt limit.

Wisconsin Legislative Republicans Seek to Curtail Governor’s Veto Power

Wisconsin Republicans proposed a constitutional amendment Wednesday that would curtail the governor’s veto powers by prohibiting a veto to increase any tax or fee.

The move comes after Democratic Gov. Tony Evers used his partial veto in July to increase school funding for public schools for the next 400 years. Republicans proposed a similar amendment in 2019 after Evers used his partial veto to increase school funding by $65 million, but it did not get a vote in the Legislature.

Wisconsin governors have the most expansive partial veto power in the country because, unlike in other states, they can strike nearly any part of a budget bill. That includes wiping out numbers, punctuation and words in spending bills to sometimes create new law that wasn’t the intention of the Legislature.

If passed by the Legislature in two consecutive sessions, they are then put on the ballot for voter approval. That means the soonest the latest proposal could be adopted would be 2025.

 

Federal Reserve Board Holds Benchmark Interest Rate Steady

The Federal Reserve Board on Wednesday held interest rates steady for the fourth straight time and cracked open the door to reducing rates later this year if inflation continues to subside. The widely expected decision left interest rates unchanged at a range of 5.25% to 5.5%, the highest level in 22 years.

Policymakers also made substantial changes to their post-meeting statement, softening some of its hawkish language. Officials dropped a sentence that suggested additional hikes may be warranted and swapped in more neutral language about the path of monetary policy in coming months.

The policy-setting Federal Open Market Committee acknowledged that the “risks to achieving its employment and inflation goals are moving into better balance” but cautioned that rate cuts are not imminent.

“In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks,” the statement said. “The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent.”

If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year,” Chair Jerome Powell told reporters during a post-meeting press conference in Washington, D.C. “But the economy has surprised forecasters in many ways since the pandemic, and ongoing progress toward our 2% inflation objective is not assured.”

“Based on the meeting today, I would tell you that I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting to identify March as the time to do that. But that’s to be seen,” Powell said.

Fewer Americans Quitting Their Jobs as Labor Market Returns to Pre-Pandemic Normal

The US Bureau of Labor Statistics said Tuesday that 3.4 million people quit their jobs in December, way down from the 4.5 million who did so back in April 2022. The so-called “quits rate,” or the number of people quitting their jobs as a percentage of overall employment, fell to 2.2%.

Though the gap between number of job openings and quits is growing -there were 9 million availabilities in December, up two months in a row after a long skid – a lot of workers still feel wary about US economic prospects. People don’t like switching jobs as much when they’re skittish about the state of the world.

UK-based research group Capital Economicspointed especially to the service sector, where labor shortages were blamed for rising prices. For instance: The “accommodation and food services” quit rate, where turnover is typically very high, fell 0.7 percentage points, to 4.5%, in December.

“The bigger news was the sharp decline in the leisure and hospitality job openings rate to slightly below its average level in 2019,” wrote Andrew Hunter, the firm’s deputy chief US economist. “That is the sector where shortages were previously most acute and where labor market conditions probably have the most direct pass-through to inflation.”

 

Remote Work in Wisconsin Declines, but Office Vacancies Remain High

Remote work has declined in Wisconsin after spiking during the COVID-19 pandemic, but office vacancies remain elevated in the state’s largest city and its suburbs.

From 2021 to 2022, the state saw an 11 percent decrease in the number of people working remotely, from 437,295 to 387,700, according to a recent study from LLC.org.

Both Madison and Milwaukee have seen about a 20 percent decline in the number of people working from home, according to the report. Madison’s remote workforce declined by 22 percent from 40,253 to 31,385 people. Milwaukee’s has declined by 19 percent from 40,265 to 32,627.

Despite the decrease, remote work nationally remains higher than it was before the pandemic. In September 2023, the average U.S. worker reported spending 3.8 days each month doing their job remotely, down from 5.8 days in 2020 but up from 2.4 days in 2019, according to Gallup.

As of 2023, Forbes reported that 12.7 percent of full-time employees worked from home, while 28.2 percent worked a hybrid model.

Greater Madison Chamber of Commerce President Zach Brandon said the decline in remote workers noted in the LLC.org report isn’t surprising, but he doesn’t expect remote work to return to pre-pandemic levels anytime soon.

While remote work has decreased in Wisconsin, it hasn’t necessarily led to offices brimming with activity in the greater Milwaukee area.

From the final three months of 2021 to the same period in 2022, office vacancies in southeast Wisconsin increased slightly from 15.3 percent to 15.8 percent, according to reports from the Commercial Association of Realtors Wisconsin. By the end of 2023, office vacancies in southeast Wisconsin increased to 17.7 percent.

 

State of Wisconsin’s Budget Surplus is Shrinking but Still Large

Wisconsin’s budget surplus will be less than what was projected six months ago.  The state is predicted to have a surplus of $3.25 billion by the end of the current budget cycle, according to a new estimate of the state’s general fund from the nonpartisan Legislative Fiscal Bureau.

The state is projected to collect less tax revenue while spending has increased. The fiscal bureau is now expecting the state will collect $422 million less than previously expected from both individuals and corporations.

This estimate from the bureau included spending that has passed since June, as well as bills currently working their way through the legislature. That includes $423 million for building projects on University of Wisconsin system campuses and other items.

Republican leaders said the new estimates show there is still enough of a surplus to deliver more tax cuts.

“These estimates are consistent with what we expected when we crafted our budget. We created a responsible budget that protects taxpayer resources, while making important investments in our state,” Sen. Howard Marklein and Rep. Mark Born wrote in a statement. “With over $3 billion in the bank and $1.8 billion in the state’s rainy day fund, it is critical for us to return a portion of these funds to the people of Wisconsin.”

When asked for a response to the revised estimate, a spokesperson for Evers pointed to this week’s State of the State address. In that speech, Evers called for funding a variety of programs, including child care, expanded Medicaid coverage for new mothers and investing in education.