Below is an excerpt from the most recent edition of WisBusiness Tuesday Trends.
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RISING
Economic optimism: A special post-election edition of the Wisconsin Economic Scorecard finds that state residents remain optimistic about the overall direction of the state, with 64 percent saying the state is “headed in the right direction.” Over the past three quarters, opinion among Wisconsin residents regarding the overall direction of the state has become increasingly positive. While residents were split on the question in March, by October a clear majority — 61 percent — said the state was headed “in the right direction.” The change after the election comes largely from an improved outlook among Democrats. Before the election, 33 percent of Democrats said the state was headed in the right direction. That climbed to 53 percent after an election that saw wins by Barack Obama and Tammy Baldwin. Looking at state government, about 46 percent of Wisconsin residents feel that Republican control of the state Legislature will yield benefits for the state economy, while 38 percent feel it will make the economy worse. And despite the recent struggles of the Wisconsin Economic Development Corporation, a small majority of Wisconsin residents — 52 percent — remain confident the replacement for the old state Department of Commerce will succeed in bringing jobs to the state. Meanwhile, the latest State Monitor report from BMO Capital Markets Economics projects the state’s economy will grow this year, albeit at a continued sluggish pace. The report says Wisconsin’s real gross domestic product is expected to expand 1.2 percent this year, up from 1.1 percent in 2011.
MIXED
Power supply: The latest Strategic Energy Assessment from the state Public Service Commission finds that the recent economic downturn has led to a lower growth in peak demand and higher energy reserves. But while the report finds sufficient energy production in the state, transmission of that energy remains an issue. The report says moving energy from its source to utility customers is an ongoing challenge, and that the PSC is a participant in multiple regional initiatives focused on transmission planning. The report also says energy rates in Wisconsin continue to rise, particularly due to the end of a major construction cycle in the state, but that lower natural gas costs are expected to offset some increases going forward.
FALLING
Wisconsin insurance exchange: Interest groups on both sides of the political spectrum have been vocal proponents of Wisconsin creating its own health insurance exchange system under the federal health care reform law, and the Obama administration twice pushes back deadlines for states seeking to establish their own exchanges in the waning days of the period to set them up. But Gov. Scott Walker sends a letter to the U.S. Department of Health and Human Services ahead of the original deadline anyway, declaring that the state would be better served by deferring to the feds to set up the exchange. Walker says that while he would have preferred a state-run exchange, it would have been “state-run in name only,” potentially exposing state taxpayers to long-term obligations. Democrats and health groups criticize the decision, with some Walker critics charging that politics played a part in the decision. Republicans counter that the move helps shield taxpayers from the potential costs of what they derisively term “Obamacare.” Some business groups, meanwhile, concede that while they have concerns with the law, they’d still rather the exchange be based in Wisconsin instead of D.C.
