After vetoing several pieces of legislation addressing social
issues earlier this fall, Gov. Jim Doyle pressed the Wisconsin
state Legislature to instead focus on job creation in the state.
Last week, Gov. Doyle got his wish as the Senate approved up to
$185 million over the next 12 years for regional technology centers
and incentives for investors in start-up companies. This bill now
moves on to the Assembly, where it will likely pass.

According to the Wisconsin Manufacturers Commerce, this state
has lost 66,000 manufacturing jobs in the last three years and has
the highest unemployment in nearly 20 years. Although a step in the
right direction, this bill only addresses part of that problem.

In recent times, many politicians have spoken about the economy
and improvements to it. Among these people, President Bush
delivered one of the most comprehensible and truthful messages
about economic development when he spoke to an audience earlier
this month in Winston-Salem, N.C. His message on the changing
dynamics of the manufacturing sector of the economy applies just as
much to Wisconsin as it does to his targeted audience at the
community college where he delivered his speech.

Toward the end of his speech, President Bush addressed the
government’s role in spurring economic growth. He said, “The job of
the government is to make sure that the entrepreneurial spirit of
America is strong, make sure that people feel comfortable in taking
risk, that they’re willing to start a small business and grow it to
a big business.” To that end, President Bush explained the need for
tax cuts on individuals a certainty in the tax code, calling for
permanent, not temporary, tax relief.

Sen. Ted Kanavas (R-Brookfield), chief sponsor of the bills here
in Wisconsin, notes that this state ranks fourth nationally in the
number of new patents issued but 47th in the number of new business
start-ups. Speaking to the Milwaukee Journal Sentinel Friday, he
explained that the disparity reflects the state’s failure to offer
capital and support for entrepreneurs with ideas for new products
or services.

Kanavas also observed that wealthy Wisconsin investors often put
their cash into start-up companies on both coasts or in Florida —
one of only a handful of states with no individual income tax. In
contrast, the Wisconsin Manufacturers Commerce notes that
Wisconsin’s state and local tax burden has been in the top ten for
decades.

Part of the package approved by the State Senate includes $75
million in venture-capital tax breaks over the next 10 years to
manufacturing or research companies with fewer than 100 employees.
However, this figure is tiny in comparison to savings taxpayers
could have seen if Gov. Doyle had not vetoed the property tax
freeze that the legislature sent to him this past summer.

President Bush correctly noted in his speech that individual
taxation has just as much effect on economic development as
corporate taxation. Not only does individual taxation hurt small
business owners, but it affects their customers as well. Gov. Doyle
missed a golden opportunity to lessen this burden. To put this
10-year, $75 million figure in perspective, the 2003 property tax
levy in Milwaukee County alone was $219,494,183.

Aside from discussing government’s role in spurring economic
growth through tax policy, President Bush also addressed what
government cannot do. He told his audience that jobs in America
have become more specialized and that Americans must be willing to
re-invent themselves to stay competitive with the changing market.
“[A]s these jobs get more sophisticated, in other words, the
training level is higher, no question about it, but the pay is
better, and that’s what productivity increases do in a society,” he
said.

The transistor was perhaps the most important 20th-century
invention, and its use has changed virtually all occupations.
Gordon Moore, the co-founder of Intel Corporation, first predicted
in 1965 that the number of transistors on a semiconductor, and thus
overall computer chip performance, would double every two years.
This prediction, known as Moore’s Law, has held true ever
since.

Not only have semiconductor devices revolutionized personal
computers; they have also significantly impacted the manufacturing
sector. Transistors have allowed for the explosion of programmable
logic-controller and servomotor technology, which has eliminated
several blue-collar jobs and dramatically reduced maintenance
costs, while significantly improving productivity in the
manufacturing sector.

While the demand for blue-collar jobs in manufacturing has
decreased, engineering positions for the development, programming
and implementation of this technology have increased. Technology
has allowed Americans to think with their minds instead of working
with their hands. As this trend continues, citizens of Wisconsin
and other states with large manufacturing economies must re-invent
and educate themselves to stay up to date — something which
government cannot force, but can encourage, through friendly tax
policies.

Mark Baumgardner ([email protected]) is a senior
majoring in electrical engineering.