For many foreigner observers – and, perhaps, many Americans too – the only reason recent goings-on in Wisconsin might cross their minds was the Green Bay Packers' victory in the Super Bowl. That was a great moment for the team's famous "cheesehead" fans and anyone who admires those who wear fake cheese triangles as hats.

In reality, it is Wisconsin politics that should be concerning all Americans, and it is no laughing matter.

Wisconsin is rapidly becoming a disturbing showcase of where America as a whole is headed, as Tea Party political ideas takeover the Republican party. What began as a ragtag scattering of conservative activists two years ago is now starting to have real political power and putting its anti-government, slash-and-burn ideas into practice in ways that impact millions of Americans.

Wisconsin is at the cutting edge of that transformation. Under its Tea Party-favoured new Republican governor, Scott Walker, and with a state legislature that recently flipped from blue to red (that is, from Democratic control to Republican), it is pushing a rightwing agenda that is shocking to American progressives. First up is an astonishing attack on unions. As part of spending cuts ostensibly aimed at digging Wisconsin out of a budgetary mess, Walker wants to brutally strip-mine state workers' benefits and pensions. He has also launched a full-frontal attack on the collective bargaining rights of 175,000 state and local employees, allowing workers instead to negotiate only over salary. It is a shocking attempt at union-busting that has caused outrage – and scores of demonstrations across the state.

Yet, in the face of that, Walker threatened to call out the state's national guard. But union-busting is only the beginning.

Walker is also aiming at a massive extension of power over the state's health programmes, covering more than 1 million residents. Cuts are likely to aim at nursing homes, medical care for children and prescriptions for the elderly, among other targets. Walker and the Republicans also plan changes to Wisconsin's electoral laws: scrapping voter registration on election day and tightening photo ID rules. Traditionally, such measures hit at Democratic-supporting low-income groups, students, minorities and the elderly. Now they have power, Walker and the Republicans want to cement it.

Then, there is the rejection of federal funds in a time of crippling austerity. In line with the Tea Party's philosophy that government help should mostly be avoided on principle, Wisconsin has now given back $23m in funds aimed at expanding high-speed internet service. The excuse was that it came with too many contractual strings. But that sum pales to the $810m Wisconsin lost when it decided it did not want the federal government to build a high-speed rail line in the state. The money then went to other, more grateful, states instead.

This is important stuff. The Tea Party's principles are being put into effect in the real world in the guise of a state Republican party that has fully embraced them. Suddenly, Wisconsin politicians are popping up on the national scene. Paul Ryan, the Republican congressman who is spearheading the budget-cutting drive in Washington, hails from Wisconsin's first district. Reince Priebus is the new head of the Republican National Committee (RNC); he is also a former head of the Republican party of Wisconsin.

Is Wisconsin where the rest of the country could be heading? Perhaps. Certainly, the White House is concerned that the state's change from blue to red could presage a threatening shift across the midwest and beyond that might upset Democratic plans for 2012's presidential election. After his state of the union address in January, President Barack Obama headed straight to Wisconsin to try and sell his new message of unity. As NBC's Chuck Todd recently said, Wisconsin is set to be a "petri dish" for the next election's key battlegrounds. If that is right, expect a fight marked by ideologically motivated budget cuts, union-bashing, anti-government rhetoric and the threat of the national guard.

The future picture of America emerging from Wisconsin is a grim one indeed.