This is Swing State of the Union — a podcast all about Wisconsin and why it's so important to U.S. politics.
Today, we'll explore the unique relationship between the state of Wisconsin and it's largest city — Milwaukee. We'll look at the financial and legal relationship between the city and state, Wisconsin's urban-rural divide, and how this contentious relationship has caused real harm.
It should be noted that both Joy and I (Sam) live and work in Milwaukee — like many Wisconsinites. More than a quarter of the state lives in the Milwaukee area and it's by far the largest city in Wisconsin.
But although Milwaukee is called the "economic engine of the state," some Wisconsinites don't view it that way.
I'm (Joy) originally from a small town in Wisconsin and when I told folks from home that I'd be moving to Milwaukee, the response was often an accusatory, "Why?" As in: Why would you ever want to live there?
For some Wisconsinites, Milwaukee is a symbol. It’s seen as the center of crime in Wisconsin, gun violence, drug abuse, and a large beneficiary of the welfare state. And if that sounds racially coded, that’s because it often is. Milwaukee is, and has been, the most diverse city in the state of Wisconsin — it is the center of Wisconsin’s Black and Latino communities.
We will return to race and Wisconsin's urban-rural divide later in the episode.
But first, we’ll explore the history of the state’s legal and financial relationship with its largest city — Milwaukee.
To better understand the City of Milwaukee’s relationship with the state of Wisconsin, we have to go back a little more than a century, when Wisconsin became the first state in the nation to institute an income tax in 1911.
"When the state adopted the income tax, it preempted local governments from using income as a tax source. And the trade off, what the state did in exchange for that, was to give municipalities and counties back a share of the state's revenue."
That’s Philip Rocco, an associate professor of political science at Marquette University, and he’s talking about the shared revenue program, which remains one of the largest sources of revenue for municipalities in Wisconsin, including Milwaukee.
When the program was set up, the idea was that the state of Wisconsin would collect taxes from every community and redistribute these funds around the state. The money would go into a general fund, meaning communities could spend this money on whatever they deemed necessary. This ensures that poorer communities are still able to meet their basic infrastructure needs.
At the same time the program was set up, there was a larger question that cities and states around the nation were grappling with: Who controls our communities — municipal governments or the state?
Rocco says, "For the first few decades of the 20th century, local governments, including in Wisconsin, made a huge number of advances in increasing their sphere of autonomy, their ability to enact policies that were responsive to what voters locally wanted to do. [This] really came to a head in the early 1920s, with a home rule amendment to our state constitution in Wisconsin. But that home rule amendment, which passed back in 1924, is kind of vague. And it still allows a lot of room for the states to intervene and prevent local governments from taking actions that are consistent with what their voters want."
He continues, "And, we've seen a trend across the United States. Wisconsin is one of the states that preempts the largest number of areas of law, and prevents local governments from enacting legislation in certain areas. And that includes things like raising the minimum wage, protections for renters, health and safety protections at work. A number of areas of policy that might matter to local voters are things that the local government has been kind of banned from taking action on, only the state can act."
What this means is that the Wisconsin state government can preempt, or prevent, policies that voters in Milwaukee want for their city. This is not just true in Wisconsin, but in most other states as well.
In Wisconsin, that preemption includes most forms of taxation. In 2017, the Wisconsin Policy Forum analyzed the funding structures of some comparable U.S. cities, and found that Milwaukee has an unusual reliance on state funding, due in large part to these restrictions. Rob Henken, the president of the forum, explains:
"The city is able to use fees for things like snow and ice removal, garbage collection. The streetlights have fees attached to them. But the use of those fee revenues is restricted to the specific services they support. So you can't jack up your garbage collection fees, and use the excess proceeds to fund your police department, fire department. You can only use those fees for garbage collection. So when you set up a situation like that, those big two of the three are either frozen or restricted that's where you have problems particularly when your expenditure needs grow."
Which brings us back to the shared revenue program. The program is incredibly important to Milwaukee, in part because the city has very little control over its other funding sources. Although Milwaukee can levy some fees and raise property taxes, the state of Wisconsin tightly controls how these funds can be used and caps how much they can rise.
But the funds Milwaukee received from the shared revenue program were essentially frozen in the early-2000s. Here’s Rocco again:
"The state Legislature stopped updating the formula that determined how much money local governments got for all of these important services, to account for inflation and to account for changes in local population. So what that meant was that even though the amount more or less stayed flat over the next few decades, the real value of the money that was coming from the state declined precipitously to the point that by 2023, you had large cities in Wisconsin that were on the brink of fiscal crisis, including Milwaukee, including Racine, including other smaller cities around the state."
This was a crisis decades in the making, but by the time the impact to Milwaukee had become clear, Rob Henken says Milwaukee politicians held little power in the Wisconsin Legislature.
"When I came to Milwaukee in 1994, Milwaukee-area state legislators dominated the Legislature. The Milwaukee delegation had so much more clout in terms of the sheer numbers of both members of the state Assembly and members of the state Senate. And some would argue that it's gerrymandering, others would argue that it's natural population shifts. But due to a variety of factors, if you look at the composition of the Legislature today and how many representatives there are whose districts touch the City of Milwaukee versus 30 years ago, you will see far fewer. It used to be that to get major legislation done in Madison, even when the Republicans controlled the governorship and the Legislature, Milwaukee had sufficient clout that they had to be at the table," Henken says.
Still, as the state’s largest city, when Milwaukee’s imminent financial crisis became clear in the 2010s, something had to be done. That something was Act 12 — a 2023 bill that was the biggest overhaul of the shared revenue program in decades.
The state of Wisconsin recalibrated the formula for revenue sharing and increased funds for every municipality in the state. But for the first time, it allowed the City of Milwaukee to levy local sales taxes, but these changes came with a cost.
"There was a stipulation that the new revenue that was being provided by the state could only be used for police, fire, EMS services, and that local governments had to demonstrate that they were not reducing the level of spending in those areas. And if they did, if they didn't spend at least as much as they had in years past in those areas, they were potentially jeopardizing the entirety of the new funding that they got from the state. The state could claw it back. And that's a huge change to the way that we think about shared revenue in the state, it used to be the case that we sort of conceptualize it, 'Here's the revenue in a way that you would have had, had we allowed you to do all the taxing that we do. Do with it as your voters wish.' Now, the focus, at least for that new section revenue is, 'Here's what we, the state, determine is the thing that you need to be spending on.' You know, spend it on this or else," Rocco says.
And it had some special provisions just for Milwaukee. Although the bill doesn’t call out the city by name, it has a number of provisions that only apply to quote “1st Class Cities.” In Wisconsin, there’s just one — Milwaukee.
Act 12 restricts funding for diversity, equity, and inclusion programs, arts programing and partnerships with nonprofits. It requires that Milwaukee Public Schools must have 25 police officers working full-time in the schools. MPS is the only school district in Wisconsin that has this state mandate.
The act removes the city’s ability to use property taxes on its street car, which has been the streetcar’s main source of funding. It mandates the new sales tax fund must contribute to pension costs, and police and fire budgets over the next decade. It also changed the authority of Milwaukee’s civilian oversight committee for police and fire.
What happens if the City of Milwaukee doesn’t comply? It could lose these new funding streams, and that could be disastrous. In an interview with WUWM, Milwaukee Mayor Cavalier Johnson explained what the city would face without these funds.
"Roughly half of our police department would have been let go. A quarter of our fire department would have been gone. That all of our libraries would have been stuttered. And hundreds of other city employees would have been let go from their jobs," Johnson said.
This might seem like a boring budget conversation, but it's part of a larger cultural and political battle between the city and state. Here’s Rocco:
"If you go back even and look at the debate over Act 12, you're going to find a lot of discussion about Milwaukee, as opposed to what's going on in cities around the state. It's as if the entire debate is really about what's happening in one city, and accusations that the city had been using its money irresponsibly, that the city was not allocating money to where it should have been allocating money and that now the state had to come in and save it. Ignoring entirely the fact that this has sort of been the setup of state government and its relationship to local governments really since 1911."
Wisconsin Assembly Speaker Robin Vos said as much, in an interview with Wisconsin Public Radio about Act 12.
"Because of bad decisions that were made over the course of the previous 20-30 years, there were many times when the City of Milwaukee did not make a contribution to their pension and then they have over estimated the rate of return. So, they have really created their own huge financial boondoggle, but we can't let Milwaukee fall off the side of the state."
This us vs. them cycle is good politics for winning elections, allowing politicians to run as anti-Milwaukee or pro-Milwaukee. But as Kathy Cramer explores in her book, The Politics of Resentment, neither Milwaukee nor rural Wisconsin materially benefits from this fight.
The bulk of Cramer’s research was from the late 2000s, in the run-up to another urban vs. rural Wisconsin showdown over Act 10 and Scott Walker’s election as governor.
Kathy Cramer joins us to talk about her work.
Sam Woods: Can you describe the people you talked to for this book?
Kathy Cramer: What I was looking for were groups of people who got together on a regular basis to visit with one another, not about politics, but just to talk casually about what's going on in their lives. Because in 2007, when I started this project, I knew, at that point in my career, that if you want to understand the way people understand politics, it really helps to listen to them. And it especially helps to listen to them talk to people that they already know, people in their own lives and ideally, it helps to spend time with them in the places that they normally spend time. So, I asked members of the UW Extension Service and often local reporters in a variety of communities that I had sampled around the state, I just asked people, you know, where can I go to find a group of regulars, people who hang out together on a regular basis, that I might get access to. So, I was often spending time in places like gas stations and diners early in the morning where a lot of the people that I was talking with were retirees, but there were often people on their way to work. I would say the typical person I spent time with was a guy, a white man. But there was much more variety than that. So, I talked to many women, but many of the groups were mixed gender. Some of them were just women. Some of them were just men. And initially, I spent time in many rural communities, smaller communities around the state in all parts of the state, but I was also spending time in suburbs and in Madison and Milwaukee.
Powers: Now, this is a pretty big question, but what do rural people in Wisconsin generally think of their urban counterparts?
Cramer: It's a little bit hard to say, but folks in rural Wisconsin often feel misunderstood by people in the cities in Wisconsin. I encountered a very strong perception that people in the cities don't quite understand what rural life is like or the challenges that people face. There's also a sense that people in cities don't have a good understanding of the economic challenges, in particular, that rural communities face. And there's a sense that, you know, the higher paying jobs, the jobs with better benefits tend to be in the cities, there's more infrastructure in the cities, and so, local governments, just through economies of scale, have a little bit of an easier job meeting some of the necessary things that local people need — whether that's meeting mandates from higher levels of government or just providing the basic services that people in most communities expect, it's a little bit harder for rural communities. But there's also a sense that people in the cities don't respect people in rural places and kind of look down on them and yes, just don't respect them as much as they deserve.
Powers: That really gets to our next question. So, this kind of resentment, we do see it playing out in a variety of ways in the state. How does this play out in politics?
Cramer: Well, it's great fodder for politics, right? Because when people have this sense of resentment, this feeling of, “I'm not getting my fair share,” and that sense of injustice has been there for a while, and it seems like it's intentional in some respects. When people have that feeling, there's a desire to understand why it's happening, why things are out of balance and why you're not getting what you think you deserve. And that makes space for a politician to come along and say, “You know what, you’re right. You're not getting what you deserve. And it's so and so's fault,” or point the finger at a given social group, whether it be public employees or the so-called liberal media. It just, it creates a desire both for people to have answers and for someone to stick up for them. And it creates a space for someone to make an argument that helps explain why the injustice is going on.
Powers: One of the things we've noticed, and probably in part because we are from Milwaukee, but Milwaukee and Madison both seem to become kind of symbols of urban life in Wisconsin. How do politicians use Milwaukee and Madison as a symbol?
Cramer: Well, one of the best examples to this day I think, was the controversy over the proposed train line between Madison and Milwaukee when Gov. Walker was first running for office in 2010. And at the time, the incumbent Gov. Jim Doyle had accepted $800 million from the federal government to build this train line. And Scott Walker said on a campaign trail, you know, what if I'm elected, we're not going to accept that money because that's hard-earned taxpayer money that's not going to fix the roads up through Black River Falls, and it's not going to fix the roads up in various parts of the state. It's only going to be a service that's used by people in Madison and Milwaukee, just those two places. And it was a way without explicitly saying, “I'm not going to take this money because it's only going to help people in those two big cities.” I mean maybe in some ways he was saying that explicitly. But it was a very symbolic, in my mind, a very symbolic use of the tension that existed at the time between Madison and Milwaukee and the rest of the state.
And Cramer is right that while rural communities in Wisconsin are struggling, Milwaukee is not an easy place to earn a living either.
According to Census Bureau data from 2022, Milwaukee’s median income was more than $20,000 less than Wisconsin as a whole. One in four of Milwaukeeans live in poverty, compared to just one in 10 statewide.
In addition, finding affordable housing gets harder every year. Milwaukee historian Reggie Jackson, who you’ll remember from Episode 1, explains how housing accessibility has changed in Milwaukee since he moved here in the 1970s.
"Milwaukee was a city where, you know, you could find affordable housing pretty easily in the 1970s. Nowadays, affordable housing is really, really a challenge. You know, we've seen a dramatic increase in the amount of rent that people are paying. And so we have a a huge crisis," Jackson says.
Along with income and housing insecurity, Milwaukeeans also carry high levels of community trauma. Dimitri Topitzes, professor and chair of social work at UW-Milwaukee, specializes in the long-term effects of child mistreatment. He has led studies in Milwaukee that build on a body of research called Adverse Childhood Experiences, or ACEs. ACEs refer to traumatic events in childhood — including neglect, abuse or other experiences that have long-term detrimental effects on brain development in children.
"What we've found, at least in certain communities in Milwaukee, is that the rate of exposure to either childhood or adulthood, potential traumatic experiences is exceedingly high when compared to, say, the population at large, even when compared, say, to combat veterans experiences of trauma exposure. In one of the studies that I conducted in central city Milwaukee, where we sampled primarily Latino, Latina men and women and and African American men and women who were primarily economically stressed or distressed, we saw that exposure to at least one significant lifetime experience of trauma or potential trauma was upwards to 95%. More interestingly, exposure to five or more different types of trauma or potential trauma was something on the order of two and three," Topitzes says.
Milwaukee is not alone. It’s an issue shared among cities throughout the nation.
"We know that Milwaukee is experiencing rates of poverty, disparities across race when it comes to incarceration, when it comes to high school graduation. The data that I've seen on ACEs doesn't necessarily distinguish Milwaukee from other cities, but these rates of exposure to adversity are really quite high, again, in certain pockets, in these communities, particularly when we expand those ACEs to include items that would be really relevant for low income families. We're doing as poorly as a number of other cities who are facing a lot of challenges similar to ours — cities like Philadelphia and Newark, Detroit et cetera," Topitzes says.
And this is not dissimilar to levels of trauma exposure among rural low income Wisconsinites.
"I find it unfortunate that there are really strong cultural divides between urban and rural communities, particularly urban and rural poor communities. Contrary to what we would believe, these areas actually show quite similar levels of exposure to adversity. And in fact rural white communities will report higher levels of adversity, at least to some particular types of exposures, like for instance, growing up in a family where there was household mental health problems, growing up in a family where there is household substance abuse problems. And these particular items tend to elevate the rates of ACEs, adverse childhood experience exposure, amongst certain rural poor communities relative say, for instance, to urban poor communities, which unfortunately tend to be people of color and urban poor communities. However, there's another caveat those those rural communities, the ACEs that they're asked don't often include questions about discrimination. So if we ask those questions, then clearly urban communities are going to be elevated on that particular item," Topitzes says.
Which brings us to the elephant in the room when we talk about the relationship between Milwaukee and Wisconsin. It’s about race.
People tend to talk about race in coded language, even when race is at the heart of the conversation. But, this is easily quantifiable. Milwaukee has, by far, the highest concentration of people of color in the state. According to 2020 Census figures, 39% of Milwaukee residents are Black, compared to just 7% statewide. Milwaukee is 20% Latino, compared to just 8% statewide. And Milwaukee is 33% white, compared to 80% statewide.
So when talking about the politics around the urban/rural divide in Wisconsin, whether or not race is explicitly mentioned on the campaign trail, or whether or not each individual voter has race in mind when they head to the ballot box, policies that single out Milwaukee will, by definition, disproportionately affect Wisconsin’s people of color.
Which brings us back to Act 12. As mentioned at the beginning of this episode, Act 12 was part of the state’s 2023 budget bill passed by a Republican-controlled state Legislature and signed into law by a Democratic governor. The bill included provisions that only applied to Milwaukee, ostensibly to offset rising pension costs and avoid widespread city budget cuts.
But provisions limiting diversity, equity and inclusion-related programs or micromanaging the city’s civilian oversight board of the police are more about changing policy than saving money. And the mandatory hiring of police officers actually adds to the city’s highest budget expense — its police department. This year, the City of Milwaukee will spend $304 million on its police department, that's 43% of its general operating fund.
These provisions make more sense when you stop thinking of Act 12 as a budget bill, and start thinking of it in the context of trends seen in Milwaukee, and across the country, in the summer of 2020.
Following the murder of George Floyd, the 2020 iteration of Black Lives Matter protests pressured governments to cut their police budgets. Like cities across the country in 2020, Milwaukee cut its police staffing and Milwaukee Public Schools cut all but one of its contracts with the police department.
In an interview with WUWM in 2020, Markasa Tucker, executive director of the African American Roundtable, explained why protestors believed cutting police funding was necessary.
"We're going through the consequences of white supremacy not being addressed. Racism not being addressed. Divestment from communities not being addressed. The school to prison pipeline not being address. There's just a list that goes on, on over-policing. You know, we haven't addressed so much. So I don't know why people would think anything else would be the response to so, so many things that have not been addressed," Tucker said.
That summer also saw the popularization of diversity, equity and inclusion programs in city budgets, schools, nonprofits and businesses across the country.
In the years after 2020, Milwaukee’s Fire and Police Commission changed police department policy by banning the use of no-knock warrants and chokeholds and requiring more timely access to body-camera footage.
Now with Act 12, the Fire and Police Commission can't rule on police department policy and has to have two members on the panel approved by police and fire departments. DEI programs cannot be funded by the city. Milwaukee Public Schools now has mandatory contracts with the police, and the city has mandatory staffing quotas for its police department.
A hundred years after home rule was established in Wisconsin, the state government is using its budgetary authority to enact political agendas. But for political scientist Phillip Rocco, this is not surprising. The battle over who controls budgets has never been about fiscal policy, it’s about power, he says.
“The throughline here, going all the way back to the 19th century, is that this state preemption issue and the battle between Milwaukee in the rest of the state, it really isn't about ideology, it isn't about identity, it's about power," Rocco says.
In Wisconsin, as in the nation, urban and rural communities are pitted against one another for political gain. Policies like those mandated by Act 12 are great for settling old political scores, but they’re not helping Wisconsinites who need it most.
On the next episode of Swing State of the Union, we’ll look at one of the oldest political battles in Wisconsin — labor rights. From the Bay View Massacre to Act 10 and current unionization efforts, we’ll explore the past and future of working Wisconsin.
"Not trying to say, 'Hey, you know would be great is let's just make it like 1980 again,' or, 'Let's make it like 1955 again.' We want to build a union movement that is going to change the jobs of bartenders and baristas and cooks and cashiers and cleaners and servers and security guards, the kinds of jobs that exist now and will continue to exist for people who come from all different kinds of backgrounds," says Peter Rickman, president of the Milwaukee Area Service and Hospitality Workers Organization.
Labor left and right. Next time on Swing State of the Union.
"Swing State of the Union" is produced by WUWM — Milwaukee’s NPR, a part of the NPR Network. Subscribe to the "Swing State of the Union" podcast wherever you like to listen.
