Protesters talk to police officers in front of the state Capitol in... ((AP Photo/Andy Manis))
MADISON, Wis.—After focusing for weeks on his proposal to strip public employees of collective bargaining rights, Gov. Scott Walker on Tuesday presented his full budget proposal—a plan that cuts $1.5 billion in aid to public schools and government but avoids any tax or fee increases, furloughs or widespread layoffs.

Walker said the cuts could be paid for in large part by forcing government employees to pay more for their pension and health care benefits. But his proposal to do that—and to eliminate most collective bargaining—remains in limbo after Senate Democrats fled the state to prevent a vote.

"This is a reform budget," Walker said in prepared remarks. "It is about getting Wisconsin working again,

Union Iron Worker Randy Bryce of Milwaukee holds up a court order to open the doors of the state Capitol in front of police officers in Madison, Wis., Tuesday, March 1, 2011. Opponents to the governor's bill to eliminate collective bargaining rights for many state workers are in the 14th day of protests . ((AP Photo/Andy Manis))
and to make that happen, we need a balanced budget that works—and an environment where the private sector can create 250,000 jobs over the next four years."

Walker's proposals have stirred a national debate over public-sector unions and drawn tens of thousands of protesters to the Capitol for three weeks.

The governor released his two-year budget in part to support his argument that public worker concessions are essential to confront a projected $3.6 billion shortfall.

By eliminating most collective bargaining, Walker says, state agencies, local governments and school districts will have flexibility to react quickly to the cuts he outlined during a joint session of the Legislature convened under heavy security.

Even though Walker isn't ordering immediate layoffs, his budget will put tremendous pressure on schools and local governments, which will be asked to shoulder huge cuts without raising property taxes to make up the difference.

Walker's budget includes a nearly 9 percent cut in aid to schools, which would amount to a reduction of nearly $900 million. The governor also proposed requiring school districts to reduce their property tax authority by an average of $550 per pupil.

Since 1993, the state's property tax limits have gradually risen to reflect increasing costs, and reducing them makes it more difficult for schools to make up the lost money.

Additionally, cities would get nearly $60 million less in aid, an 8.8 percent cut, while counties would lose over $36 million, a 24 percent reduction. They would not be allowed to increase property taxes except to account for new construction.

Walker estimates that his controls on property taxes would save $736 over the next two years for the owner of a home valued at the median price of $161,300.

He's also proposing a $500 million cut to Medicaid, which would be achieved through a number of changes that include increasing co-pays and deductibles and requiring participants in SeniorCare to be also be enrolled in Medicare Part D.

Walker asked for $82 million in tax cuts, including an expanded exclusion for capital gains realized on investments made in Wisconsin-based businesses. The Legislature previously approved more than $117 million in Walker-backed tax cuts that take effect later this year.

The budget also cuts funding at most state agencies, by 10 percent, except for salary and benefits.

He would permanently eliminate 735 positions that have been vacant for more than a year. Some other jobs could be cut as Walker moved to consolidate juvenile prisons and make other changes, but no widespread layoffs were envisioned. State spending over the next two years would go up a paltry 1.3 percent.

Walker also targets many law changes passed by Democrats in recent years.

He proposed undoing changes made by Democrats to allow prisoners to earn time off their sentences for good behavior. Instead, Walker would reinstitute a truth-in-sentencing law that he sponsored while a member of the Assembly.

He would also no longer allow children of illegal immigrants who attend state universities and colleges to pay in-state tuition.