Larson Report 
NEWSLETTER

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 A Capitol Update from State Senator Chris Larson

Dear Wisconsin Neighbor,

I hope you are getting back into the swing of things after another round of winter weather in Wisconsin.

Things are ramping up in Madison, and it has been a busy couple of weeks at the Capitol. I have been meeting with each of the nominees that Governor Evers has put forth to head his agencies and talking with them about their mission and priorities. I also had some eventful meetings in the Agriculture, Revenue, and Financial Institutions Committee and we had a floor session in the Senate.

You may have noticed that major national news outlets have featured Foxconn and its disastrous deal with Wisconsin over the last few weeks. In this Larson Report, I wanted to take a deep dive into the Foxconn deal and provide a full accounting of how we got to where we are.

Also, in a recent meeting with Governor Tony Evers, we discussed some of the most pressing legislative priorities for our community. I'll break that down for you below. He seemed agreeable to many of the common sense issues brought forth and I look forward to working with him for many years as we put Wisconsin back on track.

As always, please reach out if you have ideas, questions, or concerns about our shared community and state.  

 In Service, 

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How We Got Here: Foxconn; a History of Disappointment 

 

If we go back to July of 2017, we will remember that more than halfway through his second term, then-Governor Walker was facing a tough reelection bid and was still disastrously short of his promised job creation goal of 250,000 jobs from his first term. We also had President Trump desperate to appear to be making progress on his campaign rhetoric to bring manufacturing jobs back from overseas. We also had House Speaker Paul Ryan in need of a political win.

It is important to note that Governor Walker was so excited to appear as if he had any kind of a plan to create jobs that he hurriedly scribbled an offer to Foxconn's Chairman Gou (a noted savvy negotiator and tax subsidy wrangler) on what amounts to a cocktail napkin.        Foxconn note.jpgAnd that's when the negotiating (or lack thereof) began. It is important to remember that both the State Senate and Assembly had to take the votes authorizing WEDC to approve the Foxconn deal without ever being allowed to read the contracts. In September of 2017, the Foxconn legislation was brought to the floor of the Senate, and the Assembly and Democrats offered amendments to address some significant concerns with the bill. Democrats offered amendments that would've prioritized opportunities for Wisconsin workers and Wisconsin businesses, strengthened taxpayer protections, and preserved the health of local communities.

On the floor of the Senate, my Democratic colleagues and I argued that the legislation authorizing Foxconn was a mistake that Wisconsin would be paying for generations. According to reports from August of 2017, the earliest that the state could be expected to be fully reimbursed for the Foxconn boondoggle would be 2043, and that was based on the deal costing the initial estimates of $2.85 billion, not the $4.5 billion final forecast projected. Democrats argued that taxpayers would be on the hook long past 2043 and that this payback table, long though it is, was still unrealistic. Democrats stood up and argued that the screens Foxconn was planning to manufacture in Wisconsin were already being fazed out in their other factories around the globe and that it would be unrealistic to expect Foxconn to manufacture those screens in Wisconsin. We also warned our Republican colleagues that due to global labor dynamics, Foxconn's promise of creating nearly 13,000 jobs in Wisconsin was wildly inflated. And finally, we warned that Foxconn has a terrible reputation for making wild promises, extracting as much as they can and then demanding more, and more down the line     

Ultimately, all Democratic arguments went unheeded and all Democratic amendments to safeguard the taxpayers of Wisconsin were rejected by the majority Republicans. On Tuesday, September 12th, 2017 the Wisconsin State Senate approved the Foxconn legislation 20-13 in an overwhelmingly partisan vote.            

Before going into what exactly the state promised to Foxconn, we should take a moment to acknowledge that former Governor Walker and his lapdogs at WEDC never wanted their contract with Foxconn to be public before it was signed off on. Initially (in October of 2017), WEDC refused to break its policy of not releasing the contract for the Foxconn deal before it was signed. What this meant was that the elected officials who are appointed to the WEDC board were being asked to vote on and approve the Foxconn deal while never being allowed to read the actual contract. It was only through intense pressure from the public and legislators like Senator Tim Carpenter (D-Milwaukee and member of the WEDC board) that WEDC finally released the contract for review, and what was in it was staggering.

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The total number of eligible tax subsidies had ballooned from $3 billion to $4.5 billion. What this amounted to was the richest government corporate handout in United States history. As noted above, Foxconn's Terry Gou is a tough negotiator who is known for getting the sweetest of sweetheart deals out of governments, both federal and state. In recent years he has captured desirable deals in Brazil (2012), Indonisia (2014), and in Pennsylvania (2013), each time promising massive investment and job creation — each time falling well short of his promises. That is not to say that Foxconn and Terry Gou take losses when they don't live up to their end of the deal. 

What happens is that they suck up as much government money as they can under their agreements; meeting only what contractual demands intersect with the company's financial needs and whims. In the case of Wisconsin, former Governor Walker, Legislative Republicans, and Donald Trump were outmatched and outmaneuvered by Chairman Terry Gou. Under the GOP Foxconn deal, Wisconsin will still be paying roughly $230,000 per job created.  

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The money, staggering though it is, wasn't the only concession Terry Gou was able to wrest out of Wisconsin's Republican lawmakers. Under the deal, the state also gave significant environmental exemptions to Foxconn. Former Governor Walker and Republican policymakers didn't just rewrite the environmental rule book for Foxconn; they threw it away.

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  • Foxconn is allowed to siphon 7 million gallons of water a day from Lake Michigan
  • The State Department of Natural Resources did not require Foxconn to seek approval for construction activity on some types of wetlands. Endangering wetlands that function to retain stormwater, filter pollution, and provide critical habitat for wildlife
  • The wetlands exemption allowed for the potential destruction of wetlands that are safeguarded by the state of Wisconsin
  • Foxconn would be allowed to operate without stringent air pollution controls 

On top of the impacts to our shared environment, Republicans gave away the farm to Foxconn. No one should have to give up the home that they have spent a lifetime shaping and building. Our homes are where we raise families and make memories. But, homes are exactly what folks were made to give up (36 homes) when 2,800 acres of Wisconsin farmland were deemed "blighted" to benefit Foxconn. In total, local governments committed up to $764 million, funded through Tax Increment Financing (TIF) payments, to prepare the site.

The sad fact is there are families still fighting for their homes to this day. A trial date has been scheduled for July of this year for a Mount Pleasant family that is desperately trying to hold onto their home of 25 years.   

So, that's where we started, the promises made, the warnings issued by legislative Democrats, a fortune staked in money and resources, and hopeful taxpayers being sold a bill of goods about how manufacturing was finally coming back to Wisconsin.

Where We Are Now: An Epic Boondoggle

Time and again, since Republicans passed the sweetest of sweetheart deals for Foxconn, the news has been disappointing and bad. 

First came the news in July of 2018 that Foxconn was no longer planning to build the larger, more expensive generation 10.5 manufacturing plant in Wisconsin, and instead would plan to build the smaller, cheaper generation 6 plant. It is unfortunate that democratic warnings about this happening were ignored when the evidence that this would happen was so clear.  Since the contracts reference the building of a larger manufacturing plant in Wisconsin, this change should only be interpreted as a breaking of the deal and a breach of contract.     

Then, in January of 2019 reports began to surface that Foxconn was (unsurprisingly to those who opposed this deal and cautioned against trusting Foxconn on the job numbers) not fully committed to manufacturing anything in Wisconsin. That the 13,000 manufacturing jobs they promised were a wild overestimation, and that they might not manufacture the promised screens in Wisconsin at all.

In those reports, Louis Woo, Assistant to Terry Gou, dropped a bombshell that Foxconn was reconsidering manufacturing in Wisconsin because of the obvious financial limitations of making LCD screens anywhere in the United States. The argument that Foxconn would take a look at its bottom line and decide that it would be too costly to manufacture in the United States was made by opponents of this deal in the beginning and were ignored. Damningly, Woo was quoted as saying, "In terms of TV we have no place in the U.S. We can't compete." He then added, “In Wisconsin, we’re not building a factory. You can’t use a factory to view our Wisconsin investment."  It was further explained that Foxconn's presence in Wisconsin would be scaled back to a research hub and no assurances or revised job estimates were offered. 

This, understandably, sent proponents of this deal scrambling to explain why precisely the horrible deal they struck was falling apart and on whom exactly they could attempt to lay the blame. In what was widely criticized as a pants on fire whopper, Republican leaders tried to insist that Governor Evers was to blame for Foxconn's global financial decisions. According to Foxconn, their talks with Governor Evers have been "constructive."

And the bad news just kept coming. Earlier this month (February 2019) it was reported that Foxconn hadn't made significant progress on its headquarters in Milwaukee or satellite offices. Pointing to permit records filed with the city of Milwaukee it is clear that very little work has been done on the building Foxconn purchased at 611 E. Wisconsin Avenue in Milwaukee and the work that had been done was to accommodate the tenant to which Foxconn has been leasing most of the building.     

What Foxconn is Saying Now

Of the major Republican players who architected this colossal corporate giveaway, only President Trump remains in office. And, wanting to preserve the fantasy that Foxconn would be his claim to fame for job creation President Trump again extracted hollow promises from Terry GouFoxconn was reported to have told President Trump that it will build a smaller, Generation 6 manufacturing plant in Wisconsin. Which is still not the larger plant they had initially promised. But again, they offered no revised job number or further assurances.

What we all need to keep in mind is that Terry Gou has a long history of making big promises, extracting as much as he can, and then under delivering. It is also important to remember that Terry Gou also views his Wisconsin plans as great leverage in the US/China trade war. Chairman Gou said as much when he was back in China, after speaking to the President. We would be foolish to continue to trust Foxconn when they continue to talk out of both sides of their mouths. 

It is a real shame that, due to Republican leadership, Wisconsin has been made a pawn in a global trade war, and that our Republican leaders fell for such an obvious farce.

Instead of continuing to chase the Foxconn fantasy, we should build local businesses by restoring the rest of the historic $1 billion cut from education, investing in repairing our local roads and bridges, and finally investing in the regional public transportation options which attract the economic development of the future. Over the last eight years, Wisconsin had the opportunity to invest in ourselves but time and again Republicans chose to invest in millionaires, billionaires, and foreign corporations.

Discussing Priorities With Governor Tony Evers

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I was thrilled to sit down with Governor Tony Evers and discuss some of the more pressing issues of the 7th Senate District and Wisconsin as a whole. It is very heartening to have a governor who is willing to sit down with policymakers from both sides of the aisle, to hear about the concerns of our shared community. The discussion that we had was informative and productive. I am very hopeful that we will finally be able to address some of the policy issues that will be laid out below.

Voucher School Accountability: One of the major issues that faces education in Wisconsin is the unchecked expansion of the private school voucher program. First, we need to get a handle on what the cost of the voucher program is to taxpayers. The Governor and I both believe that the true cost of the private voucher program should be readily apparent on your tax bill. You deserve to know just what this is costing you and what kind of resources it is siphoning away from your local public schools.

I also discussed with the governor the need to bring true accountability to the voucher school program. What this means is we need an unbiased review of both the cost of the program and the quality of education these schools provide. We need a true cost/benefit analysis of the private voucher school program. Otherwise, we will never be sure if the significant tax dollars we have shelled out over the 30-year experiment is worth it. As someone who spent a lifetime on education issues, Governor Evers is clearly interested in transparency and accountability.  

Reducing Drunk Driving in Wisconsin: This is an issue that has struck every family in Wisconsin. Personally, it's been 20 years since a close friend of mine was struck and killed by a drunk driver. I discussed legislation with Governor Evers that I have introduced which would require that anyone convicted of an OWI install an interlock device. I am hopeful that this is one of many issues that can receive bipartisan support this session. I was certainly encouraged that Governor Evers was receptive to taking a strong stance on addressing drunk driving.

Expanded Options for Bicyclists: Here in Milwaukee there is great interest in making our city more accessible for cyclists. One way to achieve this is over the Hoan Bridge, which is a major arterial connection between the commerce of Downtown and the South Shore. When the Hoan Bridge was being rehabilitated, over 5,000 petitioners lobbied to have bike lanes incorporated so cyclists could have a safer option for commuting to work. The alternative is a maze of heavily trafficked surface streets and thoroughfares where bicyclists have no protections from motor vehicles. 

Unfortunately, former Governor Walker blocked that plan. It is now time to make a simple change and require the Department of Transportation to open a safe and protected bike lane on the Hoan Bridge. I encouraged Governor Evers to recommend the prospect of this commuter friendly option and will be talking with his Transportation Department appointee about this issue.

For the last ten years, Milwaukee riders have been able to experience the efficiency of riding over the Hoan Bridge on the annual Ride for the Arts cycling event. Registration is now open for the 2019 ride and this ride is a great way to see the convenience of a dedicated, safe, and protected bike lane on the Hoan Bridge. 

Clean Drinking Water: Governor Evers and I spoke at length about the disastrous health consequences of lead poison in our drinking water and I was happy to see that he is committed to dedicating $70 million in investment for addressing Wisconsin's drinking water crisis. We are committed to making 2019 the year of clean drinking water in Wisconsin. This investment is undoubtedly a great start; now Republicans need to come to the table with Democrats and pass legislation aimed explicitly at lead abatement in Milwaukee.  For every dollar we spend investing in lead abatement, we see a 133% return on that investment in higher lifetime earnings and health outcomes.

Marijuana Legalization: I was glad to hear Governor Evers express an openness to medical marijuana in Wisconsin. The fact that in 2019 we have neighbors afflicted with chronic pain, weight loss due to cancer or HIV/Aids, and multiple sclerosis who don't have access to this effective drug is unacceptable. I also advocated Governor Evers for full legalization in Wisconsin. States that have legalized marijuana are experiencing a state revenue boom from taxes and fees associated with the marijuana business. Colorado brought in $267 million in revenue in 2018 alone from marijuana. The sad fact is, enforcement of marijuana prohibition is biased and racially skewed. Black and white people use recreational marijuana at roughly the same rate, yet a black person is three times more likely to be arrested for possession. It's time to move forward on this issue.

I was very encouraged by my conversation with Governor Evers and very impressed that he is personally taking the time to meet with each state legislator, regardless of party affiliation. If there are issue areas you would like to see me bring up the next time I have the opportunity to sit down with the Governor, please CLICK HERE and let me know what is important to you.            


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In January, on Martin Luther King Day, people are encouraged to use the holiday in the service of others. 

As Black History Month is coming to an end, I encourage everyone to take an extra day this month and dedicate it to community service. Every community has fine organizations in need of volunteer hours and neighbors in need.

Whether it's volunteering at your local Humane Society, with your church group, or cleaning up your local neighborhood and streets, dedicating another day to community service it a great way to round out Black History Month. One of the most fulfilling things we can do as human beings is to be of service to others. So, take an extra day this month and go the extra mile for your community. 

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The Larson Report strives to provide up-to-date, in-depth information to you. Between editions, a lot happens in Madison and around the country. I want to make sure you know the most pressing issues facing our neighbors and friends across the nation. Below are some of the top stories from the past couple of weeks. 

Culver's Beats In and Out Burger and Shake Shack as Best Burger Joint by Resturant Business Online!  

It's always good news when a business with such strong ties to the state of Wisconsin is recognized nationally for its quality. Congratulations to Culver's restaurant for beating out other burger heavyweights like Shake Shack and In and Out to be the highest ranked burger restaurant in the Restaurant Business Online rankings.    

Republicans in the Wisconsin legislature Dictate to the Legislative Black Caucus Who They Can and Can't Honor for Black History Month

Wisconsin Republicans never pass up the opportunity to embarrass Wisconsin on the national stage. In story, after story, after story, America was introduced to a Wisconsin Republican party who felt entitled to tell African American elected officials who they can honor.

The point here was not whether or not any particular politician agreed with how Colin Kaepernick chose to protest police brutality; the point was that a Republican caucus that is devoid of African Americans thought it was okay to dictate who African Americans can take pride in. 

It is important to note that the Legislative Black Caucus came up with the list of names they wished to highlight from their community on Black History Month. They included Colin Kaepernick because he is a Wisconsin native, a generous supporter of charities, and he has taken a stand against police brutality that disproportionately affects the African American community.

Whether it's Muhamad Ali, Malcolm X, or Martin Luther King Jr, many civil rights advocates and great American leaders were considered controversial in their time.  It should never be the prerogative of legislators outside of the black community to tell the black community whom they can publically respect and honor. 

 

We Energies Seeks to Expand Amount of Mercury Dumped Into Lake Michigan

Earlier this month, I attended a meeting in Oak Creek with over 150 neighbors to express concern with WE Energies requesting permission to dump mercury and arsenic into Lake Michigan. We Energies is also requesting to push back the date they would need to comply with lower standards until 2023.

 

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This is unacceptable. I testified at this meeting because I know that the longer we allow utilities to delay moving to a renewable model, the longer our neighbors will have to deal with unsafe levels of mercury and the mounting problems with coal ash. Burning coal is simply unsustainable. We need to be aggressive in our investment in renewable energy.


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