(h/t to First Draft for photo)
Crooks & Liars- By Susie Madrak
March 07, 2011 07:00 AM
From the Cap Times (via First Draft, a blog that’s done an amazing job cover the Madison movement). This insurance plan is something that doesn’t cost the state government anything — but doesn’t profit any of Walker’s friends, so it has to go:
If you need a prima facie example of how this extremist Republican governor is taking the side of the big guys against the little guys, I’ve got one for you.
Hidden in the 1,300 or so pages of his 2011-13 budget is the dismantling of Wisconsin’s little-known State Life Fund, a small state-operated life insurance plan that was enacted 100 years ago this year by progressive Republican legislators in the wake of insurance scandals that rocked the state back then.
The fund costs Wisconsin government nothing, but operates off investing the premiums paid by the 30,000-plus state residents who hold policies with face values ranging from a minimum of $1,000 to a maximum of $10,000. The fund, which isn’t well-known because it is forbidden from doing any advertising, nevertheless earns dividends that substantially reduce the insureds’ premium costs plus build cash values that policyholders can cash in if events in their lives make it prudent to do so.
In 2010, the State Life Fund sold 146 new policies with $69,000 in new premiums. The plan is totally self-supporting and continually runs a surplus. It requires no extra workers in the Office of the Insurance Commissioner. It’s a good deal for young families who want to have at least a little life insurance protection. Some cash in their policies and use the cash value to help pay for their children’s college. Older folks are known to purchase a policy to cover funeral expenses.
Yet Walker wants to freeze it in place come July 1 and close it to further purchases.
It’s a blatant giveaway to the private insurance industry, which has long bristled at the existence of the fund, insisting that it is “socialized insurance.” It has tried without success for several decades to get it killed. The most recent attack on it came from dishonored former state Rep. Scott Jensen of Waukesha, himself an insurance industry shill. Even Tommy Thompson’s Republican administration wouldn’t go along with Jensen’s scheme to close it down.
But now comes Walker, who received substantial campaign contributions from insurance interests in his race last fall. And because of the acquiescence to his machinations by the Republican majority in the Legislature, the threat to the fund is much more serious. Walker will get his wish unless the proposal is removed from the budget bill before it passes.
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