 Welcome back to the Donahue Group. We're together again, Ken Risto, Tom Pineski, Cal Potter. I'm Mary Lynn Donahue talking about the great issues of the day, both at the local state. And today I think we may even make it as we perceive them to be at the national level. And you need to always at least let me get the introduction now before rudely interrupting. One of the interesting, almost historic developments of the state legislature was the introduction, the co-sponsorship of semi-real campaign finance reform by Mike Ellis and Fred Risser. It is still in committee at the state level, I believe. But just the fact that it was introduced, I think, is in response to citizen concerns about it. Cal, you're our state person having lived and prospered in the legislature for a number of years. You know what prospered? Prospered with the campaign. Actually, not in those days. Well, I think it's long overdue. I have, over the years, seen the influence of special interest groups become greater and greater. And as a result of their influence, not only because they hired guns called lobbyists, but also because of the influence they have during a campaign. My first assembly campaign way back in the early 70s was, I think I spent $3,000. Now it's not unusual to see a state senate candidate spending a million for a job that pays, why don't I, $45,000 a year. There's something disconnecting there between the average senator and his or her constituency and the shaking down of groups, mostly, to get $1 million to finance a political campaign. And the resulting representation that you get from that, I think, is more beholden to those who have given that million dollars than it is to listening to the people. Sure, there are exceptions to that, but I think when you start getting to the high dollar amounts, and that's, we're seeing that now, projections on what the governor's race is gonna cost. And we know what congressional races and U.S. Senate races cost. We know there is a disconnect from the average person and what groups tend to expect after we give literally tens of thousands of dollars to a candidate. I think this has to stop. We have enough challenges in our society that need to be met, and we need to have a, I think we need to elevate our legislative perceptions to that which we expect that of our judiciary. I mean, we don't even allow our judges in the state to run by party, unlike Illinois in some places. But they certainly have to raise money. They do, and that has been a question of where they do get their money from. But historically, we've always said this branch of government ought not to be Democrat or Republican, it ought not to be commenting on cases before they're heard and sort of very hands-off type of, and pure type of perception that we have of judicial races, whereas in the legislature, we've allowed interest groups and lobbyists literally to become so deeply involved that it goes beyond partisanship. It goes beyond who's carrying water for who, and I think the people lose out in the long run. So I'm glad to see that at least out of a Senate committee on the state level, Senator Risser, a Democrat and Senator Ellis, a Republican, have gotten a bill out of committee in a five to zero vote, and that now will be debated on the floor of the state Senate, and hopefully when this session is done, we will have something that we haven't had for decades in this state, a successful attempt at campaign finance reform. Tom Pineski, stand up for free speech. Isn't this just a- I'm just gonna say, you can do all you want with campaign financing, but money finds holes. Just like water finds holes, just like we saw in the presidential election in campaign finance reform, they found the water flowed to another spot. So applaud the efforts, but I think it's the money will flow to the place where there is no campaign finance reform. You're not gonna cover everything. That's sort of how I think about it. I would contend that where the money water here flows is usually as a result of lobbying by special interest groups during the debate on the campaign finance group for their own exemption. It's just like we've had numerous attempts at simplifying and purifying our tax code. And then when we get done, it's probably about five times thicker the tax code than it was before. And if you look at why, it's because this group or that group said, yeah, you tax them, but don't tax me because I'm worthy of not being taxed. And all of a sudden you have all these exemptions. And now there's a push on the national level that maybe we ought to just throw out the income tax and go to a value added task, which is sort of a sales tax. But I would contend that once again, you control your special interest groups, what you will have is a value added tax or a sales tax on the national level, but all the interest groups that, maybe people who have oil or gas or coal or what happens, oh, not our product. And so they'll lobby that they have an exemption from the compatibility of that tax. And that's where you need to, that's why if you want to have a product that passes the smell test, you really do have to disenfranchise the money and the interest groups because they do pervert really the attempts at whether it's reforming the political finance system or the tax code or whatever it happens to be, the groups that are left out there do tend to get their way. We see it in agricultural policies. For many years, people have lamented, we ought not be subsidizing in any way tobacco. Well, tobacco is a big interest in this country and the lifeblood of many farmers. And as a result, that was something that lasted for many, many years. We could go back to them, not of products where exemptions have been wrought and you say, well, why is that in the tax code? Well, I can tell you why. There's probably a well-paid lobbyists and a lot of campaign contributions. Now, it's not always that simple, but sometimes it's because the community of elected representatives happens to have a lot of tobacco plants or something in their jurisdiction. But we do need to make it at least past the smell test and a lot of our votes and decisions that are made on a national and state legislative level do not. And they ought to have more public policy ramifications that are positive incentives of helping people. Let me just ask Ken, just in terms of, you're our social studies guy. Has money, money has been spent on campaigns throughout our history, isn't that true? Sure. And the courts, and I think the real difficulty in building on what Tom says is, until you get to, and I hate to be a purist here, but the Supreme Court is basically, as it continued to say, that so far, and they've tried to negotiate around the edges, but money equals free speech. And how people want to spend their money is an important part of their First Amendment rights to political expression. And until you have that in the equation, the Buckley decision, unless you're willing to go to a national taxpayer-based sort of pay candidates and pay people after they reach a certain threshold of public opinion, I don't know how you're gonna get money out of the system. And then the perception always is going to be that government is for hire. Political scientists have been trying to study this thing for 25, 30 years and they're gonna tell you that television ads don't influence voters, ultimately when they vote. They'll tell you that study after study shows that money buys you maybe access, but certainly there isn't any real clear evidence that it actually buys votes per se. But boy, there are a good number of political studies and you go to political science down the hall here at the center in 141 or whatever they call it and you'll see that stuff in the basic poly-site primers. But my experience has been as a guy who used to be the bank, I wasn't really the bank man for the union, but you know, I had to. I had, you know, but I was here for you earlier. Yeah, I want to invoke my fifth amendment rights at this point. You have an attorney right here. No kidding, I want to talk to council and we'll take a break right now. But I've had opportunities where you represent a group of say 800 teachers in the local community and you talk to local board members and you, there isn't certainly a quid pro quo where I walk in and say we can provide certain amount of PAC money for you but we need your vote on this, this, and this when it comes up in front of the school board. You know, it's not as crass as that. But people, I don't know, Cal, maybe the real world was different, but I think people understand that these are the folks who are helping you pay for the lawn signs. This is on a local level, much less, you know, NFL politics up in Washington or even in Madison. They understand where the lawn signs come from. They understand where your foot soldiers come from and those are the people that you're certainly going to probably put your thumb on the scale if you have to vote. And, you know, I think you see that playing out in Madison in educational policy, you know. Nationals, you know, the Association of Manufacturers has their, you know, I think their number three in the state, my union, you know, is number one in the state in spending and you see that there's absolutely no agreement because everything is so polarized about how to deal with state financing of education. And then you fold in another bill that's pending in the legislature. I think it's AB 46, which is going to make, presume to make many changes to the campaign finance rules and regulations. And I have been the treasurer for a number of campaigns, local campaigns, and trying to pick your way through the regulations, the statutory requirements as well as administrative code regulations, just relating to how much money you can bring in. And do you know, for example, that the limitation per year for the mayoral contribution is $507.92? I mean, these are, there's the 45% rule, there's the 65% rule. You know, I've been to school for a lot of years and I'm scratching my head trying to figure out what these rules and regulations are and it is just like the tax code. You look at the, at AB 46, I think that's the right number and it adds as far as I could tell from just skimming through it, another level of complexity to an already pretty complicated system in terms of trying to keep people honest with campaign finance contributions. So, I mean, both from the theoretical level and just from the practical level as some poor campaign treasurer who's trying to figure out, is this legal, is this not legal? It's tough stuff out there and I just wonder whose interests we're serving. I mean, until just recently, Wisconsin had certainly a reputation as a pretty clean state in terms of government. I think that reputation has been tarnished somewhat. But still you think, gee in Wisconsin aren't we gonna play it right and aren't we gonna be, aren't we gonna be true to ourselves? I don't know, I think it's pretty tough. Well, you know, the whole campaign finance initiative started with the whole Nixon administration era and after the Nixon years, we had the public financing statute for presidential elections and we modeled, we followed suit on a state level with the public finance law of our own. And basically the Buckley-Vallejo case which struck down spending limits and contribution limits basically stated that if you don't accept public financing, the government has no right to put any type of control. So the free speech was, the hinge was on the public financing and what happened basically over time is that public financing set strict limits and provided such minimal amount of support for a campaign that candidates just said I can't support a campaign on 15,000 I think it was for assembly race and 37,000 for a Senate race. They were costing hundreds of thousands so candidates just abandoned the system and legislative bodies really were lamenting then the fact that the court has said that unless they take public financing you can't do anything about it. I vehemently disagree with the court. I think that the government is the government of the people and that whether you accept public money or not you accept public confidence, you have public expectation of doing a decent job and I think that the court was way off base. I don't know what they were drinking or smoking when they had that made that decision but I really think the government is indeed beholden to the public and to the public good and I don't care whether you accept public financing or not special interest group money ought to be limited to a certain amount. I'm not precluding that you shouldn't you know realistically allow teachers or manufacturing commerce to participate in some way but when it starts getting into figures that are much more than any other individual would ever participate as Ken pointed out there's going to be some semblance of sensitivity to the fact after the election somebody gave that candidate many, many dollars and I think their pre-interview is going to be somewhat corrupted by the fact that the monies were as large as they are. Tom, how do you handle the sidebar discussion? Those that are in make the rules to stay in. That's the sidebar discussion because there are that the government you said the government needs to make the rules. True, real campaign finance reform and we don't know what it would look like or how it would be implemented is truly I think a revolutionary concept because it changes how business gets done and because of that like tax policy is a major social policy that not only raises money but just governs so many ways that we live our lives and what we value and what we don't value. I'm going to segue right into our next topic as time is running a little short and I'm sure as the bill makes its way through the legislature we'll revisit it because it is pretty interesting stuff. There has been an effort at the local, state and now national level to address inequities in the minimum wage. Minimum wage I believe in the state of Wisconsin remains at $5.15 an hour. Governor Doyle has tried on a couple of occasions to raise the minimum, state minimum wage I believe I'm not sure the exact amount. Six, 25 an hour is what comes to mind but I could be wrong there. And just yesterday, Cal, I think you indicated that the federal government. Today, as we are taping this, the U.S. Senate voted on both the Democrat and the Republican proposals to raise the federal minimum wage. Yeah and I think I heard that that same branch of government has raised its salary to the tune of about $28,000 in the last four or five years. Thoughts, comments? Are we ever going to get people? But I view minimum wage as a teenager getting a job and they started to sell it. That's kind of how I view it. Now some people have a little different view. And McDonald's locally, I think at one point they were paying $6.50 because they couldn't find anybody. So minimum wage was $5.15 but they're paying $6.50 or something like that. They're looking for people who could deliver a product and you get a young kid. Well I guess they have not only young kids but they have adults working there too. And they pay them accordingly as best they can to keep them. Kids nowadays sign up for $6.50 and two weeks later they find a job for $9 and three weeks later they find a job for $12 and they just boom, boom, boom and... Well not in Sheboygan. Well, you sent us a phone number. So it's kind of where do you put the bottom line for people to begin to work and move. And that's kind of how I look at it. My beef with it is that even if minimum wage was $5.15 back in 19... Cal, when was the last time it was changed? 1997, if I'm not mistaken. Right, it's national wage office. Yeah, we're almost 10 years down the line. Even if $5.15 was even considered to be an adequate minimum wage, applying the same philosophy that you did just teenagers or it's just women because they don't really need the money. That used to be the philosophy that women provided the pin money, the second income. But in any event, that's just my little bias coming out. But why can't we change it now? Just to reflect inflation, diminution of buying power? Well that's the reason why we ought to address it. And the pure conservative would say capitalism is ruled by law supply and demand and therefore we ought government, we ought to stay out of the whole issue of spending our setting limits. But the problem is that those factors in the economy don't always apply in every community. In most cases, the scenario that Tom has portrayed is true for the last couple of years. McDonald's have been, the fast food type joints have been paying a lot more than $5.15, probably $7, $6.50, $7 an hour. And it's been due to the fact of competition of workers. But that holds true in some communities but not in others. There are communities where you've had massive layoffs, maybe a rural community in northern Wisconsin, very much a shortage of jobs. And as a result, the economic factors that would give people choices and give them higher wages than a minimum wage are just not there. And what do you then do to protect a worker from being exploited? And there are people who would exploit workers. We see that with undocumented immigrants, sweatshops. You can go to New York Garment District and find innumerable people who are working for less than minimum wage. And why are they? Because those folks will not stick their head into the legal system and say, I'm getting ripped off here. I'm being exploited. This is a sweatshop. They know that they're not even supposed to be here, let alone have that job. So they're being exploited by unscrupulous people who are simply trying to make a buck. Now somebody else would say, well, is that the government's job to protect people who can't speak out against inequities. But I would say that exploiting people is wrong. And I don't care if you're legally illegal, exploiting people is wrong. And you ought not to do it. And there are people who do do it. And as a result, we can, I think, after a passage now of seven or eight years, say that five, some dollars an hour ought to be maybe six, 25 an hour. Even though, again, probably 80, 90% of people are not even working for that. The fact of the matter, there are some. And there are some people that ought not to be exploiting other people. And really, if they are caught exploiting, that's another way to nail their ears to the wall here legally by saying, you not only are exploiting these people in a sweatshop environment, you're violating what you should be paying them. So it is a tool, in a way, of preventing exploitation of labor. Traditionally, up until about the mid-70s, minimum wage was around 50% of the average working wage in this country. Right now, the average working wage is around $15 an hour. And we're seeing it five. So clearly, minimum wage hasn't kept up. And the Kennedy proposal, which got shot down, would have put it pretty much in that same traditional ratio. In terms of adjusting for inflation, minimum wage peaked in the late 60s already. And it's been downhill. I think it's a difficult case to tell a family, a single family, that you work 40, 45 hours a week. And at minimum wage, and you're still below the poverty level. And that's, I mean, it's equitably, in terms of equity, it's a tough sell. I know in the fast, the problem with minimum wages is that when you raise the minimum wage, you are gonna lose some workers in the mix. I mean, that is the basic law of supply and demand. You're gonna price some workers out of the market and that's sort of traditional. And that was the argument being in the Senate floor yesterday when they were debating this bill, is you're basically making entry worker jobs that much more difficult to do. Clinton administration tried something a little bit different. They tried their income tax credit. And that was remarkably successful in raising incomes in that lower level without having to mess around with labor markets. The difficulty there was, there was a certain amount of fraud, to be sure. And there's a certain amount of paperwork that lower income families have to negotiate, which is a little bit difficult for them to do. And I was, and then, that great liberal Republican, Richard Nixon, proposed something along the same lines when he talked about a minimum, basically negative income tax is what he called it to make it more palatable. But it basically is the assumption that if you're working 40 hours a week and you're paying your dues and you're paying your taxes and you're a good citizen, you should have a reasonable level of income to support your family. That doesn't seem like a terribly awful thing to ask of a country that spends billions of dollars in cat food and dog food every year. And it really focuses on working. You know, your tax credit mechanism is that even though you may not earn enough to have to file, be required to file, you do get money back from the federal government, but there's no guarantee that you're pulling your weight in the workforce. And so whereas when you're talking about minimum wage, you're basically applying it to somebody who has works a minimum number of hours and you're really putting forth the fact that you're putting forth an effort to help yourself. And while you're doing that, we're gonna at least say you should get a minimum amount of pay for the effort that you're putting forth. See, it plays out differently in different companies and different industries. You know, McDonald's and the fast food industry, for example, you know, scream about any time they increase the minimum wage. And the studies again show that really, they don't really get rid of any workers, you know, without turning this into an economic seminar, they're really insensitive to those kinds of wage increases. But small business people, on the other hand, are extremely sensitive to those kind of changes and it makes it difficult sometimes for them to hire workers depending on the type of situation. There's also some stereotypes of what we pay types of workers. For example, in Europe, people who work in restaurants and in some of your service industries get paid a great deal more than they do in the United States. And one of the things that we hear in this country is that, well, people wouldn't be able to afford to go to a restaurant whatever if the pay was too high in a restaurant. But what you hear from Europeans in response is that these are very worthy jobs that some of the service in a restaurant positions. Why have we elevated manufacturing in certain types of jobs to be paid well and the service industry taking care of children in a daycare center or working in a restaurant is somehow low pay work that maybe we ought to, in many cases, send a message that if we are indeed going from an industrial society to a more service society that some of the jobs that we are now creating in a society ought to pay more. That it's worthy to be working in a restaurant. It's worthy to take care of little children and let's pay people like we used to pay people who made cars or steel or some other type of products. Tom, you were gonna... Another kind of Madison's doing it, Milwaukee's doing it versus having kind of a state mandate. So that's kind of another issue. Should you let the local communities do it or should it be a state or should it be federal? And interestingly enough that the minimum wage being done at the local level is really being framed in terms of a living wage. And so you have groups that figure out if you're just a normal person living in a modest apartment with or without health insurance, how much money do you need to make an hour in order to just live without, say, the government subsidies of food stamps or medical assistance or whatever else might be available. And those really range from like $9 to $11 an hour just to have a $500 a month apartment, which doesn't get you that much these days and paying the utilities and so forth. I think you framed the argument is that minimum wage is not necessarily a living wage. It clearly is not. It clearly is not. Do we wanna have a base living wage or what is the role of the minimum wage? Right. It's not necessarily a minimum wage. And I think that at least in some of the iterations that I saw it was pegged as government, the living wage would apply to government contracts so that if you wanted to do government work, you'd have to pay a living wage. And I'm not sure the status in Milwaukee and Madison, do we have those, were those minimum wage provisions actually enacted? I don't know. Milwaukee and Madison did pass. Oh, yeah. And I think the impetus there was that the state and the federal government wasn't doing anything. And as a result, progressive local city council, they say, we're gonna show them and we're gonna set the stage and we're gonna expect these things in our communities. And I think they actually, maybe at the local level, there is more political will. I don't know. I know there was a group in Sheboygan that was working on this issue and simply gave it up as not being an obtainable goal to implement a living wage within Sheboygan County. So hard to say where that's going to go or how it's going to happen. Any ties, we just talked about this briefly before the show. We just have a minute left. Efforts to tie minimum wage to the current bankruptcy reform litigation on a national level. That's what Senator Kennedy tried to do yesterday was and is to attach that as an amendment to the provision and that amendment process got shot down yesterday and then the bill itself must have been voted down today. And what were the, what was the substance of the amendment? Well, it was basically, if you're gonna approve the bankruptcy bill, you're going to approve a minimum wage of, I think the Kennedy proposal was something like 750 or 775 an hour, that sort of thing. All right, well, and that's of course another additional topic of conversation and the wonderful thing about this group is we always have lots to talk about. So we'll see you again.