May 25-28, 2011
May 25 02:16 The DFL's Misinformation Machine in High Gear This Soon? May 25 10:40 Chamber Sides With GOP, Minnesota's Job Creators May 25 12:23 A Dayton Soundbyte Is Worth 1,000 Words May 25 15:54 Dotting the I's, Crossing the T's? May 26 01:15 Unions, Dayton Family, Making Their Presence Felt May 26 10:03 Senate Unanimously Rejects Obama's Budget May 26 21:09 Questioning Gov. Dayton's Questionable Decisions May 27 02:05 Rebutting John van Hecke May 28 08:22 "Grow Up & Get Serious"
Prior Years: 2006 2007 2008 2009 2010
The DFL's Misinformation Machine in High Gear This Soon?
I knew that the DFL's misinformation machine would quickly spewing misinformation but I didn't think it'd start this soon. This SC Times editorial is wrong about this:
When these elected officials took office, state laws (which, by the way, they control) required a two-year budget plan costing $39 billion. Dayton first proposed a biennial budget of $37 billion, which he cut last week to about $35.8 billion. Republicans embraced a 'cuts-only' approach, saying the state should spend only what it takes in for 2012-13. That amount is projected to be $34 billion, which Republicans note is an increase from about $31 billion when this all began.
From a constitutional standpoint, that's a stunningly wrong answer. In fact, one legislature can't lock in the actions of a legislature not yet elected. That's indisputable fact.
The $39 billion that the Times Editorial Board references refers to the budget tails from the 2010-2011 budget. While it's true that the budget bills were signed into law, that doesn't mean that that biennium's appropriations and the next biennium's budget tails are etched in stone.
It's accurate to say that MMB bases their forecast on the Department of Revenue's revenue forecast and the size of the budget tails from the previous biennium's budget bills. In no way does that lock in the budget tails from the 2010-2011 budget bills.
Noticeably missing from the Times' editorial is Sen. Cohen's admission about the GOP budget:
SEN. COHEN: We're going to be passing a budget that it billions and billions and billions and billions of dollars and at a level that we've never done before in the history of the state. The 12-13 budget will be $34.33 billions of dollars in general fund dollars taxed to the citizens of Minnesota. The 10-11 budget two years ago was $30.171 billion, I believe.
Sen. Cohen has been a DFL legislator for 34 years. He certainly isn't going to say that the GOP is the biggest in state history if it isn't true. Why didn't the Times editorial reflect that? This portion of the editorial is also questionable at best:
We have championed a balanced approach of substantial program cuts and limited tax increases. That puts us more in line with Dayton's plan, although we believe tax increases should sunset in two years.
Let's be clear about a few things. First, it isn't that the top marginal tax rate will be lower with a smaller tax increase. That's still stuck at 10.95%. Next, with a $3.5 billion deficit staring us in the face for the 2014-15 biennium, what's the likelihood that the Times and other DFL apologists will still advocate the sunsetting of this year's tax increases?
Next, there's the notion that there aren't huge chunks of fat in this year's budget. MnSCU alone is filled with fat, ranging from replication of program offerings on multiple campuses to the need for 53 campuses for MnSCU. HINT: That need doesn't exist.
One of the bills Gov. Dayton vetoed Tuesday contained Rep. King Banaian's budgeting reform bill. Had Gov. Dayton signed that omnibus bill, it would've been a huge step away from the current government-spending-on-autopilot system.
The Times' article deals with things as they currently are, not as they should be. That means that they're ignoring the huge reforms in the GOP's budget. Shame on the Times for that.
Let's summarize for a moment. The Times admits that they've "championed a balanced approach of substantial program cuts and limited tax increases" which they admit "puts us more in line with Dayton's plan." They don't admit that the GOP plan has significant reforms that will save taxpayers hundreds of millions of dollars this biennium alone.
Finally, this paragraph sums it up nicely:
Admittedly, it's possible to fill that $1.8 billion gap with more cuts, but doing so puts Minnesota's most vulnerable at even bigger risks while essentially passing tough decisions to city and county jurisdictions. That's not compromise; it's dodging accountability.
Cuts aren't the same as cost savings. Budget cuts result in fewer dollars being spent. Cost savings means that the state has figured out how to deliver the same level of service for a lower cost to the taxpayers.
The Dayton administration admitted in testimony to the House Taxes Committee that LGA increases wouldn't prevent property tax increases . In other words, raising taxes on "the richest 2%" wouldn't prevent increased property taxes on the average citizen. In that scenario, Gov. Dayton would get what he wants and Republicans would get nothing of what they wanted.
Finally, I'd argue that going from $37 billion to $34.33 billion is a smaller step than going from $30.171 billion to $34.33 billion.
What's left unanswered is this question: how will raising taxes on Minnesota's job creators make Minnesota's economy grow? Until Gov. Dayton and the DFL can explain how raising taxes before cutting more from the budget, I'll ignore the Times' suggestion that the Republicans need to compromise.
Posted Wednesday, May 25, 2011 2:16 AM
Comment 1 by walter hanson at 25-May-11 09:08 AM
Gary:
I think the tack you took was wrong. Your tack should be that the Times was praising governor Dayton for wanting to spend $1.8 billion dollars we don't have! Keep in mind the budget is balance at $34 billion now! They want the unbalanced budget of $35.8 billion and to balance it tax increases.
Walter Hanson
Minneapolis, MN
Response 1.1 by Gary Gross at 25-May-11 09:28 AM
Walter, The point I tried making, which you might not have noticed, is that the St. Cloud Times is all but admitting that they'll accept their role as the DFL's apologists on this subject.
I'd further point out that the 'Dayton compromise' doesn't balance so it isn't a viable option. Gov. Dayton reduced the size of his tax increase but he didn't downsize his spending request.
Comment 2 by walter hanson at 25-May-11 01:10 PM
Gary:
The point I was trying to make is that the Times like the governor wants to spend an extra $1.8 billion which we don't have. They are just as guilty as the governor. They are doing more than covering for the F- minus governor.
Walter Hanson
Minneapolis, MN
Chamber Sides With GOP, Minnesota's Job Creators
The Minnesota Chamber of Commerce has thrown its support behind the Republicans' budget plan . I suspect that that's because they understand that the budget isn't just about putting the right numbers in the right spots on the spreadsheet. It's because the Chamber understands that it's about creating or strengthening businesses that hire people.
The St. Cloud Area Chamber of Commerce is standing with GOP legislators who say Minnesota's budget impasse should be resolved without a tax increase.
That comes as DFL Gov. Mark Dayton formally rejected Republican legislators' proposed fix for the state's projected $5 billion deficit.
Dayton on Tuesday vetoed budget bills that had been passed by the Legislature, writing that they would cut too deeply into funding for state agencies, colleges and universities, and programs for needy and disabled people.
The Minnesota Chamber of Commerce has maintained state leaders should budget within the about $34 billion in general-fund revenues the state is projected to receive under current law. That's consistent with the position of Republican legislators, and contradicts calls by Dayton and DFL legislators for a tax increase on the wealthy to offset deeper spending cuts.
I'd argue that a group of citizens could find lots of spending cuts that the DFL has granted sacred cow status to. Gov. Dayton has proven that he's a) willing to streamline government operations but b) unwilling to question current spending levels.
Budgets shouldn't just be about getting the expenses and revenues to balance out. Budgets should be about revitalizing Minnesota's economy, too. Unless I'm misreading them badly, that's the message that the Minnesota and St. Cloud Chambers are sending Gov. Dayton.
I've been remiss in not stating this clearly. Gov. Dayton's budget doesn't revitalize Minnesota's economy. It doesn't even balance. The last I'd heard, Gov. Dayton just proposed reducing the size of his tax increase. He didn't say he'd moved his global budget number downward.
Gov. Dayton hasn't made the case for how his budget, especially his tax-the-rich scheme, will revitalize Minnesota's economy. I think that's because he knows it won't revitalize Minnesota's economy.
The DFL hasn't put anything on the table that would revitalize Minnesota's economy. Instead, they've supported Gov. Dayton's tax increase that would impose a huge increase to Minnesota's small businesses' tax burden.
Let's recall that the Minnesota Chamber of Commerce isn't reflexively opposed to tax increases. They initially opposed Steve Murphy's transportation tax increase before giving its approval to the measure. For the Minnesota Chamber to oppose Gov. Dayton's tax increase, they must see something seriously flawed with it.
Minnesotans need to know that the DFL's budget reflects their indebtedness to special interest groups. The DFL's budget doesn't reflect Minnesota's priorities. The DFL's budget certainly doesn't revitalize Minnesota's economy.
If Minnesota's employers are hit with Gov. Dayton's tax-the-rich scheme, Minnesota's employees will get hurt. That's the harsh reality of Gov. Dayton's budget plan.
Minnesotans need to know that their governor, whether they voted for him or not, is acting in the best interest of the state, not just in the special interests' best interest.
Posted Wednesday, May 25, 2011 10:40 AM
Comment 1 by Terry Stone at 25-May-11 10:58 AM
Without reforms in budgetary priorities, Minnesota will see recurring structural deficits. The Chamber/GOP plan adresses these priorities while the Dayton status quo plan does not.
A Dayton Soundbyte Is Worth 1,000 Words
Though he's shown that he's his same incompetent self, Gov. Dayton is proving that he'll be great fodder for bloggers. The quotes from this post alone prove that. Take this quote for instance:
DFL Gov. Mark Dayton on Wednesday called some Republican members of the Legislature "anti-government." "They don't know what government does," Dayton told MPR's Morning Edition. "They don't view a shutdown as catastrophically as I do."
First, Republicans aren't "anti-government." We're just opposed to government that's everything to everybody. There's a major difference. Next, I'd argue that Gov. Dayton is playing fear politics. He knows that history shows that courts rule what parts of the state are essential (I can't image HHS and education not being on the court's list.) and which parts aren't essential.
In other words, the term government shutdown doesn't literally mean that the entire state government shuts down. It's a scare tactic the DFL uses when they can't win the argument on whose budget revitalizes Minnesota's economy.
That said, some things will be shut down. Just don't expect the DMV, HHS or education to shut down. State parks likely will be shut down. While that's disappointing, it obviously isn't as high a priority as public safety, training and equipping Minnesota's National Guard, renewing people's drivers licenses and issuing new license plate tabs.
I'd further add that a government shutdown is a tragedy of catastrophic proportions to people who think government is the be-all, end-all of their existence.
Normal people, however, just care about whether they'll be able to renew their drivers license, get new tabs for their car and know that public safety is properly funded.
This Gov. Dayton soundbyte is revealing, too:
Though Dayton agreed a temporary government shutdown would be a "terrible catastrophe," he said agreeing to the budget plan the Republican-controlled Legislature approved would be even worse.
I haven't heard Gov. Dayton explain why the Republicans' budget would be worse than a "terrible catastrophe." Is it because Keith Downey's reforms will hurt his party longterm by downsizing government? Or because King's budget reform legislation would profoundly change budgeting dynamics well into the future?
Is it because the DFL's worst nightmare is people will find out that they can survive without the DFL's vision of bloated government?
Steve Gottwalt got it right in this quote:
The budget priority remains unchanged: Live within our means, and help grow new private sector jobs so we can get our economy back on track. The first rule is: Do no more harm!
We have $3 billion in new revenue for the coming budget, enough for a 6% increase in state spending. That should be more than enough! Minnesotans are tired of government growing more than twice as fast as their incomes!
The GOP majorities in the House and Senate sent Governor Dayton a balanced, $34 billion state budget that lives within our means. Dayton insists on continuing the status quo and jacking-up taxes on everyone, especially job creators, to float a 12% increase in state spending. It's irresponsible and unsustainable.
Gov. Dayton's insistence on raising taxes needlessly infers that the Republicans' reforms don't help. That's total nonsense. Republicans have done what the DFL refused to do while they were the majority, namely, they've reformed how state government operates. Dan Fabian's HF1 reform legislation is proof of the Republicans' commitment to reforming government in a positive way while growing jobs.
I can't wrap up this post without commenting on this statement:
Dayton said he's still pessimistic a deal can be reached, noting that Republicans have been "united and steadfast" against raising taxes. He said within both the House and Senate Republican caucuses are "right-wing sub-caucuses." "They just won't budge," he said.
What Gov. Dayton condescendingly refers to as "right-wing sub-caucuses", normal people refer to as principled legislators who won't compromise their principles when the DFL attack machine attacks them.
The DFL, especially Gov. Dayton and Sen. Bakk, can't read politicians who don't play political games. Certainly, they've never dealt with that type of politician in their party.
When Minnesotans gave Republicans a resounding mandate, they voted for an appealing, reform-oriented agenda. They knew that because that's what Republicans unabashedly ran on.
Gov. Dayton and his allies now want us to think that they're representing Main Street Minnesota's priorities. Just like Gov. Dayton's quotes, they couldn't be more wrong.
Posted Wednesday, May 25, 2011 12:23 PM
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Dotting the I's, Crossing the T's?
I've written frequently about St. Cloud State President Earl Potter's decision to shut down their Aviation Department. That said, this has never been just about shutting down SCSU's Aviation Department. I've made it exceptionally clear that it's also about reforming MnSCU and increasing accountability to the communities the universities serve. This weekend, while digging around MnSCU's Education Policies page, I found this sub-page to be quite interesting:
1. Closure. Closure of an academic program must be approved by the chancellor. Approval will only be granted under the following circumstances:
The closure is requested by a system college or university, and the chancellor determines that the documentation provided supports closure,
The chancellor determines that closure is warranted, or
The academic program has not been reinstated following a suspension.
The academic program closure application must be documented by information, as applicable, regarding
1. academic program need,
2. student enrollment trends,
3. employment of graduates,
4. the financial circumstances affecting the academic program, system college or university,
5. the plan to accommodate students currently enrolled in the academic program,
6. impact on faculty and support staff,
7. consultation with appropriate constituent groups including students, faculty and community ,
8. alternatives considered, and
9. other factors affecting academic program operation.
A closed academic program cannot be relocated, replicated or reinstated.
Based on what I've heard while attending airport commission hearings, SCSU didn't consult with St. Cloud's business community or with civic leaders. I've talked with several Aviation Department students, too, another affected group they didn't talk with. From what I've been able to gather, the decision was pretty much done internally.
Beyond that, let's look at the other items on the list. There's soon to be a pilot shortage due to retirements at the airlines. These students wouldn't be hired as airline pilots but they'd keep trained pilots in the pipeline gaining the experience they need.
That's certainly an argument for keeping the Aviation program open.
This procedure says that student enrollment trends should be evaluated. Currently, Aviation is the tenth biggest major on SCSU's campus.
Again, that's another argument for keeping the Aviation program open.
Further, the procedure says that student employment rates should be considered. Again, using this criteria, this information strengthens the argument for keeping SCSU's Aviation Department open.
Those things considered, the question that isn't
From what I've seen in the organizational charts for MnSCU, accountability isn't one of their specialties. Based on this chart , State University Presidents report to the MnSCU chancellor. In return, the MnSCU chancellor reports to the MnSCU board of trustees.
Noticeably missing from MnSCU's organizational chart is how they're accountable to their communities.
I don't favor universities being micromanaged by legislators or communities second-guessing their every decision. Still, I'm troubled that communities don't have significant input into their communities' universities' biggest decisions. That system doesn't whisper accountability. Rather, it shouts unacountability.
In summary, it appears as though the proper steps weren't taken in closing SCSU's Aviation Department. If there's a procedure in place dealing with that eventuality, then it's important that that procedure is followed. It's all the more important that it be followed because it's filled with imperatives.
Let me repeat this because it's important. That 9-point checklist isn't a list of suggestions. It isn't a list of recommendations. It's a list of imperatives.
Finally, it's important that it be followed because it's the way that a university is accountable to the public and its students.
This procedure wasn't followed. SCSU can't include documentation on the academic program closure application a) proving that the Aviation department isn't needed, b) that student enrollment trends are declining or c) that graduate employment rates aren't declining.
Because SCSU can't document those 3 important things, SCSU's decision to close the Aviation Department should be voided ASAP.
Posted Wednesday, May 25, 2011 5:48 PM
Comment 1 by Lee at 29-May-11 08:50 AM
I'm an aviation student at St. Cloud. I couldn't have put any of this into better perspective. Thank you for this article. The very last sentence of this article is my favorite, and is the single most stated thing in the aviation community here.
Response 1.1 by Gary Gross at 29-May-11 11:26 AM
Thank you, Lee. That means alot to me coming from someone who's living the life on the front lines of this fight.
Unions, Dayton Family, Making Their Presence Felt
Based on this article , public employee unions are making their presence felt at GOP events. The AFL-CIO, AFSCME, MAPE and SEIU were mentioned in the article.
The opponents of the Republican policies were mostly area union members or retired union members from [AFSCME], [MAPE] and other unions.
Many of the union members were at the state Capitol Monday night to voice their views to lawmakers on the final night of the legislative session. About 50 Brainerd and St. Cloud area union members were among those at the Capitol. The contingent at the Brainerd airport also included many who had conducted a protest at the State Farm Insurance office of Gazelka earlier this month in Baxter.
This fits with ABM's announcement that they're planning a major ad buy :
The Alliance for a Better Minnesota, a coalition of unions, wealthy DFL donors and others, will start running between $500 thousand and $1 million worth of ads with the hopes of influencing the state's budget debate.
Denise Cardinal, executive director of The Alliance for a Better Minnesota, says the group will run TV, radio and online ads to urge Minnesota voters to contact their legislators and urge them to support Dayton's tax plan.
Cardinal also says they'll start running ads targeting key lawmakers next week but didn't release a list of those lawmakers.
Mr. Scheck didn't mention who some of these "wealthy DFL donors" are. Thankfully, we don't rely on Scheck's reporting thanks to Mitch's great reporting . Thanks to Mitch's research, we know that, in addition to the unions, Gov. Dayton's ex-wife and the Dayton family are doing the lion's share of the funding.
While Ms. Cardinal is spending her benefactors' money like it grows on trees, I'm betting that bloggers, with assistance from Pat Kessler and Tom Hauser, will be ripping ABM's smear campaign lies to shreds. This is what FactCheck wrote about ABM's ads :
Minnesota's race for governor is pitting corporate money against money from labor unions and wealthy Democrats. So far, the misleading attack ads are all coming from the liberal side, and the corporate side is being badly outspent to boot. The Alliance for a Better Minnesota, a group funded by labor unions and the family of Democratic contender Mark Dayton, has raised nearly $1.7 million so far. Its ads have:
Accused GOP-endorsed candidate Tom Emmer of sponsoring a bill to "reduce penalties for drunk drivers." That's misleading. The bill would have required that accused drunk drivers be penalized only if convicted.
Said Emmer was "arrested twice himself for drunk driving." That's true, but the arrests were nearly 20 and 30 years ago.
Claimed Emmer voted against "corporations and CEOs" paying higher taxes. That's false. He voted against a Democratic bill to raise state income taxes for all upper-income individuals, not corporations.
Claimed Emmer's vote "created" a huge state deficit. That's false as well. The deficit existed prior to Emmer's vote against a Democratic plan to raise taxes to help close it.
Here's what FactCheck wrote about ABM's advertisement about Tom Emmer's vote on the deficit:
The bill was an attempt to close an existing $3 billion deficit without making all of the unilateral budget cuts that Pawlenty had tried to impose, but which were overturned by the courts. To claim that the bill's defeat "created" the deficit it was intended to close is pure nonsense .
Here's what FactCheck wrote about ABM's advertisement on taxes:
The ad claims that Emmer "opposed a plan that would force corporations and CEOs to pay their fair share of taxes." That's false. The bill did not mention corporations or corporate CEOs at all. What it would have done is raise taxes on more than 100,000 high-income individuals, pushing the state's top individual income tax rate up to among the highest in the nation.
In other words, there isn't much honesty involved in ABM's advertising or ABM's website. I wrote about ABM's disinterest in the truth in this post :
Settle in high flying corporate executives, because Tom Emmer's Minnesota is going to be more fun than your last trip in a golden parachute. Here in Tom Emmer's Minnesota, we believe that paying for good schools and hospitals is the job of the unwashed masses. That's why the slightly regressive taxes of the past have been replaced by a massively regressive tax code in Tom Emmer's Minnesota.
In Tom Emmer's Minnesota, we don't even care if you have your interns set up post office boxes all over the world to avoid paying your taxes. Even if those funds would go to fund nursing homes and other medical facilities, in Tom Emmer's Minnesota we want nothing to get in the way of the gobs and gobs of money coming your way, not even fair play.
Rest assured, my very rich friend. This isn't just a one-time deal. You can trust that in Tom Emmer's Minnesota, solid investment in good schools, nursing home facilities, clean lakes, fixing roads or health care for 'regular folk' will never get in the way of your extreme wealth and stealthy tax maneuvering.
With the passing of time, I'm convinced that ABM isn't just disinterested in the truth. I'd bet that they're allergic to the truth to the point that they'd go into something resembling Anaphylactic shock.
When ABM starts running their lies, rest assured that they'll be scrutinized and criticized for their dishonesty and deception.
Rest assured that ABM's dishonesty and deception are coming to a legislative district near you. Rest assured, too, that I'll be vigilant in watching for and scrutinizing their ads.
Posted Thursday, May 26, 2011 1:15 AM
No comments.
Senate Unanimously Rejects Obama's Budget
After the Senate unanimously rejected President Obama's budget, House Budget Committee Chairman Paul Ryan took the opportunity to highlight the Democrats' unwillingness to put a budget together :
I thank Senate Majority Leader Reid for drawing attention to the bipartisan, unanimous repudiation of President Obama's budget. I thank Senate Budget Committee Chairman Conrad for drawing attention to the fact that it's been 756 days since Senate Democrats passed a budget.
I am disappointed, however, in their irresponsible abdication of leadership. Earlier this year, Republicans advanced a serious budget that saves Medicare, strengthens our safety net, and lifts our crushing burden of debt by getting government spending under control. Our plan of action puts the budget on the path to balance and puts the economy on the path to prosperity.
President Obama's reckless budget and Senate Democrats' inaction, on the other hand, commit our nation to a debt-fueled economic crisis. Senator Reid and Senator Conrad are playing politics with the health security of America's seniors and the economic security of American families.
First, it's stunning that President Obama's budget didn't get a single vote. Based on the merits, President Obama's budget shouldn't get any support.
Chairman Ryan's budget is the only serious budget on the table. That's because Senate Democrats haven't put a budget together since the Bush administration. Shame on them for not putting their priorities on paper. They're profiles in political cunning. Apparently, they think they're protecting members by preventing vulnerable senators voting on President Obama's controversial budget.
It's controversial because it doesn't bring spending or the deficit under control. It's controversial because they want to spend money on things that won't increase entrepreneurial activity. Senate Democrats might've voted against President Obama's budget but they still haven't proposed a budget that would reduce the deficit, balanced the budget or create jobs.
In that sense, though they've voted against his budget, Senate Democrats still don't have the fortitude to go against President Obama or to do the right thing for the American people.
If Senate Democrats don't put a positive, appealing budget blueprint together, the Senate Democrats' candidates and incumbents will take a political pounding.
People are starved for a specific type of leadership. Specifically, they're looking for leadership that will cut federal spending without killing the programs that they love. By not passing a budget, Senate Democrats are telling the American people that they aren't putting a high priority on cutting spending.
That won't play well as an overarching campaign theme.
Posted Thursday, May 26, 2011 10:03 AM
No comments.
Questioning Gov. Dayton's Questionable Decisions
This afternoon, the Republican Party of Minnesota unveiled a new website called Dayton's Shutdown . Part of the RPM's website is dedicated to "the devolution of Gov. Mark Dayton." According to the RPM's website, Gov. Dayton started by attacking the Republicans' plan, calling it "barbaric" and "extreme."
The next step in the devolution was Gov. Dayton's attacking Republicans with personal attacks. The RPM's website quotes Gov. Dayton's temper tantrum in the Strib:
"The Republicans all-cuts budget is extremely harsh and unfair to thousands of Minnesotans, and it's not Minnesota," he is quoted in the Star Tribune (May 25 "Budget Vetoed; Shutdown Looms). He characterized Republicans with a sneering "right-wing" tag and labeled them "extreme." They "understand little about government and care even less," said Dayton.
Gov. Dayton, it isn't that we don't understand how government works. It's that we've seen how convoluted government is thanks to 38 years of obstructionist majority rule in the Senate. Today's reform-minded Republicans are attempting to clean out the cronyism, limit the size of government and change the budgeting process. That's after they reformed and streamlined Minnesota's permitting process and got alternative teacher licensure signed into law.
Keith Downey has been an ideas machine. King Banaian, Steve Gottwalt and Mary Kiffmeyer have tried reforming the budget process, health care and the election process respectively.
The House and Senate passed their budget bills in March. Here's what Sen. Cohen said at the time:
We're going to be passing a budget that it billions and billions and billions and billions of dollars and at a level that we've never done before in the history of the state. The 12-13 budget will be $34.33 billions of dollars in general fund dollars taxed to the citizens of Minnesota. The 10-11 budget two years ago was $30.171 billion, I believe.
So the difference is over $4 billion, I believe. The largest state general fund budget ever, ever, ever, in the history of the state of Minnesota.
That's the budget that Gov. Dayton calls "barbaric" and "extreme."
By making the attacks personal, Gov. Dayton appears to be attempting to thwart debate on the merits:
Dayton's rant is not an argument. In fact, it is an anti-argument. His comments are intended to end negotiation, not foster it. By implying anyone taking the position that state government should live within its means is "harsh," "unfair," "extreme," "ignorant" and "uncaring" bypasses any logical debate and jumps right to psychological intimidation and bullying.
I've written for over a month about how Gov. Dayton, Sen. Bakk, Rep. Thissen or Rep. Winkler haven't explained how raising taxes will improve Minnesota's economy. Their argument has always been one of fairness. That isn't an economic argument. I'd argue that it's an attempt to change the subject from being on the merits to an emotional argument.
The final step in Gov. Dayton's devolution is titled "Argument from Intimidation." This is the RPM's most substantive argument against Gov. Dayton's agenda. Here's their argument:
The proper response to Dayton's argument by intimidation is not to bother with his character assassination but to immediately challenge his philosophical progressive position. Gov. Dayton's attempted intimidation hides empty and vacuous arguments devoid of sound principles and logic.
How, Gov. Dayton, does pulling resources out of the private sector that creates the wealth that makes compassion possible actually benefit the people you claim you want to help?
How, Gov. Dayton, has progressive tax policy, progressive education policy or government intervention in health care improved Minnesota let alone made life better for those on whom you'd raise taxes to pay for pet public projects, on those whom you'd deny the opportunity to flee a failing school, on those whom you'd trap in government-run health care where they are treated as second-class citizens when the actually need medical care.
I haven't heard a substantive argument about progressive policies. I've heard emotional pleas but I haven't heard a substantive argument on the DFL's policies.
Gov. Dayton, Minnesotans deserve better than your weekly temper tantrums, something you seem to share with Sen. Bakk. Minnesotans deserve a detailed explanation for your policy bromides. Let's hear your explanation for testimony given in the House Taxes Committee that property taxes still might get increased even after raising LGA. That testimony came from Dayton administration officials.
Gov. Dayton's tax policy appears to be more about extracting retribution on "the rich" than about sound economic principles. The harsh reality is that Gov. Dayton's budget couldn't get a DFL sponsor in the legislature. The vote on Gov. Dayton's tax-the-rich scheme was only possible because Republicans offered it as a minority report to their tax omnibus bill.
Gov. Dayton's tax increases, budget and bonding bills were orphans without a DFL sponsor in the House or Senate.
Now these DFL legislators, who didn't have the fortitude to present their own budget and who refused to sponsor Gov. Dayton's budget, are complaining about what the Republican budget didn't do. It's a shame that, at a time when statesmanship is needed, they're sounding like Gov. Dayton.
In many respects, DFL legislators are showing that they aren't leaders. Instead, they're following Gov. Dayton, their leader, over the proverbial political cliff.
Gov. Dayton's budget isn't appealing to people. If swing district DFL legislators stick with him in this fight, they'll lose. What's worse, though, is that Minnesota will lose if Gov. Dayton's policies are implemented.
Posted Thursday, May 26, 2011 9:09 PM
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Rebutting John van Hecke
Thursday morning, I was alerted to this post written by MN2020's John van Hecke. Here's the first thing in the article that caught my attention:
Just because a statement is made with great certainty and conviction does not mean that it is correct. Rep. King Banaian's commentary regarding the impact of Governor Dayton's income tax proposal is a case in point.
Rep. Banaian is mistaken when he asserts that 'almost half of all S-corporations and partnerships file at the top individual income tax rate.' Nowhere near half of these filers are affected by the current top tier rate. Moreover, individuals file individual income tax returns; businesses do not. Only six percent of tax returns for individuals that report positive income from owning or investing in S-corporations, partnerships, and sole proprietorships would be affected by the Governor's proposed fourth tier income tax. Even for these individuals, only the portion of taxable income in excess of $250,000 (married joint filers) would be subject to the tax increase.
I've talked with King about this issue more than a few times so I was pretty sure that he'd been misquoted by van Hecke. That doesn't mean that I'm accusing him of outright lying. I'm not doing that.
Wanting to clear this up, I emailed King to find out what he was basing his statement on. Later Thursday, King supplied me with this website . Page 3 contains information that refutes Mr. van Hecke's statements. Here's the information that King was refering to:
The percentage of returns with positive pass-through income increases at the higher income levels for the new top bracket in the 2009 legislative proposals. For example, 42 percent of the returns in the new top bracket proposed in House File 2323 had positive passthrough business income.
King augmented that information in his email:
HF2323 in 2010 session (Lencewski) was an omnibus bill that called for higher taxes, that would have put a 9% individual income tax on married couples for income over $250k which covers the range of the Dayton tax bracket.
Pass-through income does not include sole proprietorships.
I would have added, had I the time to put this in an op-ed, that 70% of small businesses hire nobody, but most of the employees of small businesses are in those few that are posting large positive pass-through income. What matters is not how many firms are being hit by the higher tax, but how many employees of those firms are being hit by it. 70% of pass-through income of S-corps and partnerships would have been subject to the Lencewski/Dayton tax rates (see graph on p. 18)
It's clear that the difference between Gov. Dayton's tax increase and Rep. Lenczewski's tax increase is the top marginal rate, with Gov. Dayton's top rate being 1.85 percentage points higher than Rep. Lenczewski's top rate of 9.1%.
Here's another part of van Hecke's article that he's wrong about:
In attempting to justify conservatives' large cuts to Local Government Aid, Rep. Banaian argues that these revenue sharing cuts will not contribute to property tax increases. He's wrong. Research from non-partisan House, Senate, and Revenue Department staff concludes that for every dollar cut from Local Government Aid, property taxes will increase by about 50 cents and funding for public safety, street maintenance, snow removal, and other city services will be cut by 50 cents.
The history of the last decade confirms the conclusions of these non-partisan researchers. Real per capita city property taxes have soared since 2002, despite the fact that real per capita city spending has fallen. How can this be? In response to huge local aid cuts, local governments have been compelled to both increase property taxes and cut local budgets.
van Hecke's argument is actually a non sequitur argument in that this research assumes that things will continue operating with the same policies that they're currently operating with. That's a reasonable assumption if you're dealing with liberal/progressive mayors but it's a foolish assumption if you're dealing with innovative mayors in outstate Minnesota.
I've written before about St. Cloud Mayor Dave Kleis's system . Here's what I wrote Dec. 30, 2010:
Reforming the regulatory and litigation systems will make Minnesota a more business-friendly state. Apparently, that isn't something that van Hecke is interested in. He'd rather argue that exercising spending restraint and making government serve the people instead of the government dictating to the people what it needs are policies that only the unenlightened could believe in.
The good news for Minnesotans is that the GOP legislative majority is asking the right questions of government :
[Rep. Matt] Dean said lawmakers will also overhaul state agency budgets: 'We're going to be saying [to state agencies], 'Let's justify your budgets. Let's go through them. What are you currently doing that you need to stop doing? What are you currently doing that you need to do less of? And what aren't you doing that you need to start doing?'
These are the right questions to ask. They're similar to Mayor Dave Kleis's questions on determining funding: Do's, Don't's and do differentlys. To summarize, if it's needed, fund it but don't spend a penny more than you have to, if it isn't needed, don't fund it, and if it needs to be funded but you recognize inefficiencies in the department, do things differently.
Citizens should demand that their mayors, city councilmembers and county commissioners adopt Mayor Kleis's methodology. If they did, they'd be in a substantially stronger position financially than they're currently in.
Interestingly, I wrote that in a post refuting a similar claim from...drum roll please...John van Hecke.
This is the closing to van Hecke's article:
Governor Dayton offers a smarter way forward. We can mitigate further cuts to education, transportation, public safety, infrastructure, services to the disabled and elderly, and other public services simply by asking the wealthiest two percent to pay state and local taxes at a rate closer to what other Minnesotans are paying. This approach will be better for Minnesota businesses and fairer for Minnesota taxpayers.
I'd argue that Gov. Dayton's approach is the exact wrong approach. Gov. Dayton's approach apparently is to figure out how to fund government first, then think about how government can use the tax code to pick economic winners and losers. That approach essentially says that you get to keep more of your money if you do what the government tells you to do.
Conservatives offer a different approach, one that's based on putting in place policies that will create a dynamic economy, then figuring out how to fund essential government services and letting a person's ideas, talent and hard work determine economic winners and losers.
Mr. van Hecke apparently hasn't figured out that a strong economy solves a plethora of today's budgetary problems. That's something that my 3 legislators get. John Pederson, King and Steve Gottwalt all appreciate the things that a strong private sector economy produces.
I wish I could say the same about MN2020 and Mr. van Hecke.
Posted Friday, May 27, 2011 2:05 AM
Comment 1 by J. Ewing at 27-May-11 07:48 AM
What am I missing? It appears to me that Dayton's only budget goal is to increase taxes on all the "rich" except for himself. To what purpose? Why increase taxes just for the purpose of raising taxes? And don't tell me for purposes of "fairness." If you don't have an outstanding public purpose for taking the money, don't take it, and if the purpose is fairness then simply cut taxes for those who are being treated unfairly-- the middle class, according to Dayton.
Comment 2 by C Quigley at 27-May-11 08:21 AM
What is it that liberals don't understand? The Rich are already paying more than their fair share of INCOME TAXES, the taxes Gov. Goofy is trying to raise. Also, when the budget increases by 6%, how can they say there are any cuts? Just because they didn't get the automatic 15 - 20% increase does not mean they got cut. Why does government get to increase its' budget every biennium while the rest of us are taking pay cuts to stay employed?
Comment 3 by zipity at 27-May-11 10:16 AM
Let's not forget, according to a Wall Street Journal article, on average for every $1 of increased taxes, government SPENDS $1.17.
http://online.wsj.com/article/SB10001424052748704648604575620502560925156.html
Comment 4 by Aaron Klemz at 27-May-11 06:53 PM
Thanks for sharing that link - it's very illuminating, but not in the way you think it is. It states, repeatedly, that only 16% of those returns that report pass-through business income would be affected by the top tax rate.
p. 3 - On the bullet point above the one you cite in your post:
"About 84 percent of the returns reporting positive pass-through or proprietor business income have total income that is less than the starting point for the current top rate bracket; that is, they are not top-bracket returns."
Again on p. 11:
"Only about 16 percent of the returns with positive business income had enough total taxable income to be in the top bracket, but these returns reported over 86 percent of pass-through income and over 32 percent of proprietor income."
p. 16 (in bold print):
"Of all returns with positive proprietor or pass-through income, only 16 percent had income in the top income tax bracket."
Van Hecke is absolutely correct. Only 16% of those filers with pass-through business income would be affected by a new top tier rate. Those 16% represent 86% of all of the pass-through income. In other words, a very small number of filers is reporting a very large amount of income.
Comment 5 by Aaron Klemz at 27-May-11 07:26 PM
Actually, I want to clarify one thing - I didn't notice that Banaian's original statement was only "S-corps and partnerships." By wiping away sole proprietors, who comprise a much larger # of returns (268,000 sole prop. vs 117,000 S-corp/ptnrship) this is misleading. But even accepting that, (p. 16):
"Figure 4 shows that S corporation and partnership returns were more heavily concentrated in the top bracket (34.8 percent) than were sole proprietor returns (9.2 percent)."
That's the existing top bracket of 7.85%, which has a lower cut off. Less than a third of all S-corp/partnership returns would be affected by a new top bracket.
Comment 6 by J. Ewing at 28-May-11 06:55 AM
Even if those saying that Dayton is right about only 2% of taxpayers being affected, WHY does he want to oppress this minority of citizens by taxing them unfairly? What is fair about 2% of people being singled out for a much higher tax RATE (and a far higher tax PAYMENT) than everybody else? (That's a rhetorical question, BTW.)
And if you think these people are "happy to pay for a better Minnesota" you should make the higher rate voluntary, as Massachusetts did, and find out how happy the rich are to avoid taxes here rather than have to move out of state. The census tells the tale, that the fastest-growing states are low-tax, and the ones losing population are high-tax. It's easy to understand unless you are a leftist ideologue.
Look, the GOP legislature gave Dayton a balanced budget and compromised by spending more than last year and more than ever before. He wants them to raise taxes for some as yet undefined additional (and obviously unnecessary) spending. That's ridiculous.
Comment 7 by Rex Newman at 28-May-11 09:35 AM
They demand the rich pay their "fair share" but when pressed, say, well I'm really talking about these rich people not those rich people. Make the Left once and for all define "rich" and "fair".
Response 7.1 by Gary Gross at 28-May-11 12:48 PM
Rex, That's a fair point but it's rhetorical in the sense that it's like putting a man in a round room, then telling him to sit in the corner. It's like giving a baseball player a round bat & telling him that a pitcher will throw a round baseball towards home plate & he's suppose to hit it square.
Comment 8 by william p. keefe at 30-May-11 11:57 AM
I don't have a degree in anything but even I could see through the way facts were proclaimed to sway opinion.Who's quote is this?"figures don't lie but liars can figure."Thank you. p.s. GOD BLESS AMERICA.
"Grow Up & Get Serious"
This week, Gov. Dayton's commission issued recommendations that should be ridiculed. According to this PiPress article , that's precisely what Rep. Pat Garofalo did:
The basic per-pupil aid that supports Minnesota schools should increase 23 percent, local referendum levies should be relied on less, and the state should invest in all-day kindergarten for low-income children, according to recommendations released Thursday by a panel appointed by Gov. Mark Dayton's administration.
The group billed its report as "a blueprint for education funding for the 21st century," but it was dismissed Thursday by a Republican leader in the House as "delusional" given the state's $5 billion deficit.
" As soon as we find the pot of gold at the end of the rainbow, we'll be able to do this ," said Patrick Garofalo, chair of the education finance committee.
The report was released just as Dayton and Republican legislators gear up to negotiate new deals on the education and other spending bills Dayton vetoed Tuesday, but Garofalo said he doesn't expect the document to have much influence on the conversations.
" We have a $5 billion deficit. Grow up and get serious ," he said.
Increasing state funding of K-12 education by 23% isn't sustainable. In fact, thinking that state government should even attempt this says everything we need to know about Gov. Dayton's seriousness. HE ISN'T!!! It doesn't even make sense policy-wise.
These recommendations should be filed in the nearest trash can ASAP. What's puzzling is figuring out why the DFL committee's recommendations are published now. It isn't like they'll get any sort of serious consideration from the legislature or Main Street Minnesotans.
They understand that the DFL's recommendations are beyond impossible. They understand that the DFL's recommendations are foolish and can't be paid for.
The DFL's recommendations prove that Gov. Dayton surrounded himself with progressives who couldn't find Minnesota's political mainstream with a GPS and an ample supply of ethanol for their Prius.
Like this commission, Gov. Dayton is driven more by ideology than by what's best for children and is sustainable financially. The Dayton budgeting method figures out what they want first, then figuring out how to pay for it.
These recommendations are worth reading through.
Among the specific recommendations:
- Set general education formula allowance for 2013 at $6,290 per pupil, up from the current $5,124 ;
- Give schools that provide free all-day kindergarten state funding for the portion of students eligible for free or reduced-price meals;
- Roll $400 per pupil of operating-levy revenue into the general education formula;
- Establish a grant program to reward schools that show high growth in student achievement;
- Expand a quality rating system for early education;
- Reduce charter school lease aid;
- Allocate integration funding based on the number of students of color in each district.
That anyone thinks we have the money for this is stunning. That anyone thinks that this is good fiscal policy is alarming. Chairman Garofalo's opinions are worth reading, too:
Garofalo said the integration funding change, in addition to being bad policy, is unconstitutional because it would confer a benefit based exclusively on race. "We're going to give you more money based off what race you are?" he said, calling the idea "mind-numbingly stupid." Cassellius said the integration funding change came from a legislative auditor's report and that race is already taken into account in allocating the money. Garofalo also described the plan as "pretty anti-charter school," given the lease-aid reduction, along with increased share of special-education costs, and he predicted it would hit the suburbs especially hard with property tax increases.
Early in the session, Chairman Garofalo's opinions and observations were measured. That proved that Chairman Garolfalo isn't a bombthrower. For him to make these types of statements means that the policy isn't mainstreet. Gov. Dayton has proved that he isn't a policy wonk. Instead, it's apparent that he's a rigid progressive ideologue. Mitch Berg wrote months ago that Gov. Dayton is anti-charter school :
So for many parents in the Twin Cities, charter schools have been a lifeline, a place where their kids aren't just numbers on a school district spreadsheet, where they have some input into how the school works. The vast majority of parents in inner-city charter schools are, ironically, minorities. Most are below the district income averages. Mark Dayton wants to slash state funding to charter schools. His budget plan (both of his tries at a budget plan, actually) will slash lease aid payments to charter schools. This is a huge financial hit. When people throw around figures like 'it costs $11,000 a year to teach a student in this district', remember that public districts can float bonds to build their school buildings, as well as get extra money from special local school tax levies. Charter schools are forbidden by (a stupid) state law from spending their money on buying buildings. The state allots a certain amount of 'lease aid' to charter schools, which helps them rent space. Dayton wants to slash this aid. It may or may not affect well-heeled schools in tony suburbs. But it will shred poor inner city charter schools.
It's appalling that this supposedly independent commission recommendations included shredding an important part of charter school funding. Shame on these mind-numbed idiots for doing what Gov. Dayton and EdMinn wants, which is to gut charter schools. Gov. Dayton and Commissioner Cassellius can argue otherwise but it's pretty obvious that they're on a mission from EdMinn to demolish charter schools. Chairman Garofalo is right. It's time for Gov. Dayton and Commissioner Cassellius to "grow up and get serious" about what's best for Minnesota's government education system. Technorati: Mark Dayton , Brenda Cassellius , Minnesota Miracle , Education , Education Minnesota , Charter Schools , Tax Increases , Spending , Commission , DFL , Pat Garofalo , MNGOP
Posted Saturday, May 28, 2011 8:22 AM
Comment 1 by Rex Newman at 28-May-11 09:55 PM
It would be interesting to ask each district what they would do with that 23% increase. If $400 of local tax were "rolled in" it would cost them nothing to roll back taxes that amount. But I bet they'd play the "alternative facilities" card to redirect that $400 into the building fund. That still leaves over $600 net into the general fund. Hello class size reduction. And raises all round. Better luck next year, students.
Comment 2 by J. Ewing at 29-May-11 03:20 AM
I disagree that this is bad fiscal policy, though it certainly is that. The bigger problem is that this is terrible education policy. Student achievement is simply not dependent on how many dollars are thrown at the public schools. If you want student achievement like you say you do, then do SOMETHING that will lead public schools to raise achievement with the money they have, and promise they will get NOTHING additional until it improves. That's called the "incentive system." Maybe even start taking money away if they can't improve on the bloody fortunes that they are spending right now.
Oh, yes, you might have to have the state government quit micromanaging the education process and the funding thereof, but how else did you expect to get anything but uniform mediocrity?
