No one in Wisconsin, least of all Gov. Scott Walker or legislative leaders, should kid themselves about the depth of the failure of one of the key tools to deliver on the governor's pledge to create 250,000 jobs: The Wisconsin Economic Development Agency. It's time to abandon this two-year experiment and re-establish a credible, transparent and focused cabinet-level department to move the state's economy forward.
Coming to that conclusion requires honesty and accountability on the part of state leaders about what went wrong, starting with acknowledging the quasi-private agency is neither the victim of an unfortunate turn of events nor is experiencing simple growing pains. The problems run much deeper and can trace their roots to the hasty founding of the agency in 2011 that borrowed heavily from privatization models used in Indiana and Michigan.
A new audit of the agency found it violated the law, ignored its own policies and displayed gross incompetence in tracking and handing out grants and loans to businesses. The agency has seen a turnstile in leadership over two years. The Department of Administration has been forced to take over some functions from the agency to address the concerns of federal officials.
In short, WEDC is a disaster whose victims are the thousands of out-of-work or underemployed Wisconsinites living in a state that has lagged in job growth who deserve better from their elected officials. An agency that can't keep its own books is not providing the certainty businesses require from the public sector to have the confidence to expand or relocate here.
There are attempts to repair the problems, but ultimately those efforts will not fix the WEDC because the agency was created on the flawed premise that the public interest should bend to business interests. That philosophy was implemented on day one as WEDC leaders slashed hundreds of jobs at the former Department of Commerce, removing employees who monitored programs to ensure they complied with state and federal laws.
The public interest cannot be served by "quasi" public control, something even WEDC board members acknowledge. "Frankly, speaking as a board member, the board was designed to be a rubber stamp and doesn't have any control over the agency," State Sen. Julie, D-Stevens Point, told the Milwaukee Journal Sentinel.
Efforts to require more sweeping changes have been blocked by Republicans who, no doubt, would like to limit the damage and fallout from the failure.
Tinkering around the edges and hoping for the best will not suffice. Instead of giving a private agency control of $75.6 million a year in taxpayer money, they ought to be restoring full public oversight to economic development to restore confidence and credibility to the state's economic development efforts.
The Final Thought: Privatizing economic development has been a disaster for Wisconsin.