‘Surplus’ a gimmick

I’ve noticed when The Badger Herald talks about Wisconsin’s budget, it suggests we have a “surplus” or a “balanced budget” when, in fact, Gov. Scott Walker has run deficits every year and has increased Wisconsin’s debt by $320 million currently (by his administration’s admission) and by potentially up to $714 million in the coming years. This increased debt is a result of a $558 million loan the Walker administration took out in June 2011, according to the Wisconsin’s Legislative Fiscal Bureau. 

Using the generally accepted accounting principles standard, Wisconsin Department of Administration Secretary Mike Huebsch admitted to U.S. Secretary of Health and Human Services Kathleen Sebelius in an official letter Wisconsin has $3.02 billion in debt through April 2013 — up from $2.7 billion when Walker took office.

Walker borrowed $558 million so he could give the false impression of a “balanced budget” because there is now money in the bank, never mind the increased debt obligation as a result of the additional $156 million in interest. Walker used the gimmicky cash accounting method that doesn’t reflect the actual debt to make the budget look better than it really is — breaking an explicit promise from his 2010 gubernatorial campaign to “require the use of generally accepted accounting principles to balance every state budget.”

John Birkholz ([email protected]) is a Madison resident.