WASHINGTON, D.C. -- Wisconsin is ground zero in a nasty gubernatorial battle pitting public unions against belt-tighteners.

But the state's Republican governor, Scott Walker -- a hero in the Tea Party and a villain among Democrats for turning Wisconsin's books from red to black by taking on the unions -- could be turfed Tuesday.

Or cheeseheads might give him the green light to stay the course.

Either way, there are huge national implications at stake in Tuesday's gubernatorial recall election -- only the third in U.S. history -- with both Republicans and Democrats across the country watching closely.

Walker forced public sector unions to pay more for health and pension benefits, scrapped many of their collective bargaining rights and also capped their pay increases -- moves other GOP governors would like to implement themselves.

But first, Walker has to survive. If he wins re-election Tuesday, he'll be the first governor ever to hang on through a recall election.

And the fight in Wisconsin, that began when public employees took to the streets and even stormed the state legislature, also looms large for November's presidential election, given the state is one of about a dozen swing states that could support either party.

Indeed, a whopping $62 million has been spent in the state so far -- an enormous amount for a gubernatorial race -- with much of it coming from out of state.

Walker's campaign alone has reportedly outspent Democratic opponent Tom Barrett's $29 million to $4 million, and big shots in both parties have been stumping in the Badger State.

Republican governors Chris Christie (New Jersey) and Nikki Haley (South Carolina) have been both active for Walker, and recently Bill Clinton was campaigning at Barrett's side.

For GOP nominee Mitt Romney, a win for Walker would not only prove that fiscal conservatism can win votes in long-held Democrat states but also that there is an appetite to rein in government spending.

For President Barack Obama, not only would a win for Walker make winning Wisconsin in November much more difficult, it may also represent a rejection of his platform -- namely, that a big public sector can spur job growth and taxes for the wealthy are popular.

Walker has lowered taxes, balanced the budget and
erased a more than $3-billion deficit (the state is actually running a $140-million surplus this year). The unemployment rate has started to fall, too.

And membership in the state's public sector unions has also plummeted by nearly two-thirds across the board, since workers now have to volunteer their union dues instead of having them deducted automatically from their paycheques, thanks to another Walker reform.