MADISON, Wis. (AP) — Wisconsin Gov. Scott Walker said Friday he wants to end collective bargaining for nearly all public employees because the state is broke and there’s no point negotiating with the unions when there is nothing to offer.

Union leaders and Democrats, powerless to stop Walker’s plan from passing the Republican-controlled Legislature next week, were reeling. They blasted the proposal as a naked power grab that will gut Wisconsin’s deep organized labor tradition and result in layoffs that devastate the economy.

Walker, a Republican who took office in January, argued that his proposal is an alternative to ordering furlough days and laying off 12,000 state and local public employees over the next two years to balance a $3.6 billion budget shortfall.

“The state’s broke,” Walker said. “Local governments are broke. They don’t have anything to offer.”

Walker wants to remove all collective bargaining rights, except for salary, for roughly 175,000 public employees starting July 1. Any requests for a salary increase higher than the consumer price index would have to be approved by referendum.

Starting April 1, Walker wants to force state employees to contribute 5.8 percent of their salaries to cover pension costs and more than double their health insurance contributions. That would generate $30 million this fiscal year. Currently, most public workers don’t contribute anything to their pensions.

Walker said Friday that he updated emergency plans and alerted the National Guard just in case they are needed to ensure state services aren’t interrupted. His plan would remove collective bargaining rights for prison guards, but it would exempt local police and firefighters and the state patrol.

Walker spoke about his plan at a Capitol news conference under the watch of a heavier than usual police presence. Walker, standing in front of seven state representatives and Lt. Gov. Rebecca Kleefisch, said no one should be surprised by his proposal.

“Unless you were in a coma for the last two years, it was clear where I was headed,” Walker said.

He said he had no doubt the Legislature would pass the bill next week. Republican leaders have come out in support, but it’s not clear what changes may be needed to get the majority votes required to pass it in both the Senate and Assembly. Republicans have a 19-14 edge in the Senate and 60-38-1 in the Assembly.

The plan isn’t about punishing state workers, it’s about reining in government spending, said Assembly Majority Leader Scott Suder, R-Abbotsford.

“We’re all going to have to share in the pain,” he said in a statement.

But Assembly Minority Leader Peter Barca, D-Kenosha, said Walker never talked about doing away with collective bargaining rights during the campaign. He called Walker’s proposal “a radical departure from Wisconsin values.”

Opponents have little time to mobilize as Walker and legislative Republicans push to pass the bill quickly. The proposal is massive in scope and would present a cultural shift in Wisconsin, which has a long history of organized labor and politically powerful unions that traditionally back the Democrats.

Bryan Kennedy, president of union AFT-Wisconsin that represents 17,000 workers, called it a “dark day for our state.”

“Unraveling more than 50 years of labor peace in the state of Wisconsin, Scott Walker’s proposal is as shocking as it is outrageous,” Kennedy said in a statement.

The right to negotiate wages and benefits through a union is a fundamental underpinning of the middle class, said Wisconsin State AFL-CIO President Phil Neuenfeldt in a statement.

“Instead of balancing the budget on the backs of hard-working Wisconsinites, we need to come up with a balanced approach that looks at shared sacrifice from everyone,” Neuenfeldt said.

Walker sent an e-mail to state workers on Friday morning thanking them for their service and making the case for the cuts. His administration also notified unions that current contracts would be canceled effective March 13, a necessary step before his proposed changes could take effect.

“We all recognize that these are historic times that require us to rethink how government operates,” Walker said in the e-mail to workers. “I ask that we continue to work together to do what is necessary to bring the state’s spending in line with our taxpayers’ ability to pay.”

Wisconsin Manufacturers and Commerce, the state’s largest business group that endorsed Walker, came out in support of the proposal, calling it modest.

Walker said in an interview that the collective bargaining changes were needed to give local governments and school districts the flexibility to deal with budget cuts he will outline in his two-year budget plan released on Feb. 22. Walker said those cuts will be more than $300 million.

Walker also proposed that his Department of Health Services be given the power to make any changes necessary to save money in Medicaid, without approval by the Legislature and without having to abide by current law governing benefits and programs.

Medicaid is the fourth most expensive budget item, totaling $1.3 billion for the current year, and provides programs for the elderly, low-income, people with disabilities, children, pregnant women and others. It’s projected to have a $153 million shortfall this year, which is driving Walker’s call for immediate budget-balancing action.

Given that Medicaid is a federal-state partnership, it’s hard to know what Walker would intend to do without getting federal waivers, said Robert Kraig, director of consumer advocacy group Citizen Action of Wisconsin.

“The state can’t make Medicaid rules willy-nilly,” Kraig said. “It’s a little hard to ascertain what the implications of this are.”

Walker has called for a study into possible changes to the Wisconsin Retirement System’s defined contribution pension plans and consideration of possible changes to state health insurance plans, including higher deductible options and larger purchasing pools.

The bill also calls for selling off the state’s heating plants, with the money raised helping to balancing the budget.