Gridlock, extremes, partisanship at the Capitol? Unintended consequences of what Northfield’s liberal voters asked for

Star Tribune reporter Richard Meryhew at the Goodbye Blue Monday Coffeehouse in NorthfieldStarTribune reporter Richard Meryhew paid a visit to Northfield and a few other towns in District 25B last week, asking citizens their reaction to the state budget battle at the Capitol.  His story appeared in yesterday’s paper: Voters say: Enough Already.  In politically diverse House District 25B, folks wonder how compromise became a four-letter word at the Capitol.

Among the Northfielders he interviewed: Chuck DeMann, Peggy Prowe, Sue Lloyd, Al Linder, Jim Johnson, and me.

Sue Lloyd was quoted: "How we’ve come to such extremes I don’t know… Are there middle [ground] people? I don’t know anymore."

Sue, we had a "middle ground" legislator not too long ago:  Ray Cox, a moderate Republican by most measures.  Back in 2007, Ray got a measly 26% score from the Taxpayers League, was at times branded at RINO by some in the GOP, and received the endorsement from the Star Tribune.  Ray wrote in a Jan. 2008 blog post after he lost the special Senate election to Kevin Dahle:

Ray CoxIn the recent Senate Special election I was honored to receive the endorsement of the Minneapolis Star Tribune newspaper. That meant a lot to me. The editors and writers there conducted a thorough review of my voting record. They conducted a comprehensive interview about current issues. While they were careful to keep partisan politics out of their discussion, the editors are well aware of the environment that the legislature must conduct its work. They noted my ability to work in a bipartisan manner on state issues in an attempt to resolve some of the more pressing concerns.

Northfield’s liberal voters rejected this moderate Republican and instead voted for Dahle in large numbers.  Likewise, Cox was not enough of a social conservative for a large number of voters in the western part of the district and so they didn’t vote in large enough numbers to offset the liberal vote in Northfield.

Northfield’s liberals won the battle of 2008 but they lost the war in 2010 when the Republicans fielded much more conservative candidates in Al DeKruif and Kelby Woodard who were able to get out the D-25 conservative vote in big numbers.

So for 25B voters to now complain about extremes, partisanship, and gridlock seems a little disingenuous.  Al and Kelby and the rest of the freshman Republicans know who and what got them there.  Why compromise with Gov. Dayton until you have to?

Tom Neuville, Al Quie, Ray CoxWayne Cox, executive director of Minnesota Citizens for Tax Justice, had a commentary in last week’s Strib titled The state’s GOP has lost its way – and many party veterans know it. He criticized the GOP for being "Not Your Mother’s Republican Party" because the voices of moderate Republicans like Arne Carlson, Duane Benson, Dave Jennings, Al Quie, and Dave Durenberger were no longer being heard by the GOP. 

Were he writing about Rice County, he’d likely name Ray Cox and Tom Neuville.


  1. Ray Cox said:

    Griff, good comments. I thought the article in the Strib on Monday was well written and captured much of the sense of 25B. Voters always reap what they sow. I don’t know if the 25B voters have decided exactly what type of politican they want representing them or not. I have always tried to be “my mother’s Republican”. (For those old enough to remember, my mother Marjorie ran for the House in 1978…an early woman candidate.)

    I do think that overall the state is better served by creating as many competitive voting districts as possible. Having a bunch of ‘safe’ districts creates problematic governing. ‘Safe’ districts elect whoever is holding the party flag…so they actually end up being elected to office by a very tiny membership—those that attend the endorsing conventions. Endorsing conventions of both major parties tend to be the more forceful people involved in party politics….hard lefts for the Dems and hard right for the R’s. So that is the type of candidate that comes out of this process.

    When I ran for office in 2002 serving in a political office was not even on my radar. I was in my 15th year on the Northfield school board and enjoyed that service. But re-districing took place, the R’s needed a candidate, and I was recuited to do that job. I appreciated the support and worked hard at my Representative job. But I also remember countless people that came up to me at events in Northfield and said “I didn’t know you were a Republican” with consternation in they face. So I went from serving the Northfield people for 15 years on the school board, being elected with some of the highest vote totals, to having those same voters ‘shocked’ that I was a Republican. Throughout all this I remained the same person I’ve always been—wanting to do all I can to help improve and serve my community and state. Hard to figure.

    May 31, 2011
  2. I have been fighting within the party for some time now, but have seen the social agenda statists chasing out the fiscal agenda types. I am often asked why I stay with a party that includes fringies like the birthers, Palinauts, and similar excessives. My answer has always been that I would rather be part of an amalgam that builds around liberty than be part of a steel beam that builds around political correctness.

    After Oberstar was defeated I wrote a hopeful commentary that perhaps the people had finally come to their senses and were prepared to throw out the Music Men (and Women) who promise us that their project will bring prosperity if we will only give them more money. I have argued within the party that Kline’s stand on earmarks as being an UNNECESSARY EVIL should, in a principled party, translate to a stand against tax expenditures, but a party that promises to rob Peter to pay Paul (like the two major parties both do) will beat a party or a faction within that party that promises to treat Peter and Paul the same every time.

    That fair party existed only as a fragile coalition in the 2010 election. At the time the Republicans were all about liberty and fairness and stopping the growth of the public sector economy. When they won the Senate and the House in Minnesota, I told any of them who would listen that they had perhaps 2 months to make their fiscal chops. I also warned them that the coalition that elected them would collapse if they touched the third rail of social agenda issues. Instead of listening to their fiscal principles of freedom and liberty, they have instead lined up their social agenda in ways that have stretched the bonds, but that have broken them.

    This statist approach to individual freedoms leaves the free-thinkers who aligned with them in 2010 with perhaps four options. They can crawl back to the steel beam party of the Democrats, and help them continue to erode freedom through their statist economic policies. They can stay with the Republicans as they use those independents to power their statist social policies. They can try to invigorate the fractured and ineffective “third parties” that may have intellectual capital (ideas) but no political capital (voters). Or they can retreat from politics altogether and watch, and complain bitterly, as the two major parties fight viciously for the hearts and minds of the electorate using all the powers of marketing, niche marketing (selectively lying depending on the audience), the politics of division and conflict, the politics of fear mongering and single issue voters.

    Or, they can take the Fifth way. Engage both parties at every public meeting. Be tireless, like the gun control fanatics that trail Kelby Woodard and other Republicans, go to every town meeting and hijack the discussion. Fight the dark politics of privilege with the bright lights of reason. Bring me back my representative republic with statespeople who know that educated voters means that politicians need to explain and defend their agendas not by using “applause lines” designed to invigorate the voters, but rather with reason and truth designed to reason with the voters. Explain that if the public sector grows too large it saps the creative and innovative sector and we all become poorer.

    Or we can just hunker down like the passengers in third class on the Titanic, and go down with the ship.

    May 31, 2011
  3. If I were running for office, I would explain to people that in order for an economy to be healthy, you have to have a product to sell…stoves, refrigerators,information,automobiles,guns,flowers,stuff like that.
    You cannot sell a poor man’s hunger or illness either here nor abroad.
    Nor can you help anyone without something in your bag of money.

    In other words, you cannot build a castle on sand near the Atlantic Ocean.
    You must have a solid economy. And I add the following to be sure you know that I know what it is ALL about.

    Preamble of the U.S. Constitution
    We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

    May 31, 2011
  4. Patrick Enders said:

    Griff (or Ray),
    Can you point to any specific vote during this session in which Ray would’ve disagreed with Al or Kelby – and where his vote would’ve tipped the balance and changed the legislative outcome?

    If not, then there really isn’t any functional difference between Ray and the other Republicans who currently hold those offices.

    May 31, 2011
  5. Patrick, your question presumes that the only effect legislators have on the process is their vote, when in fact their presence, their lobbying and their actions prior to the vote might be, in the end, more important than their actual vote. So it would be more fair to pick your favorite bills and ask if a reasoned dialogue with some dissent from within the party could have changed the outcome.

    Sadly, I do not think it would have changed the outcomes on any of the bills I suspect you find repulsive.

    For example, I have talked with some (R) senators (not ours though) who are really trying to change the way we use the tax codes (expenditures) to pick winners and losers in the market place. This practice so poisons the well that we are unable to even talk rationally about whether tax codes are “fair”, let alone try to discuss what the proper ratio of public sector to private sector is.

    May 31, 2011
  6. By the way, I find them repulsive too. I apologize (in the spirit of shared blame) for them.

    May 31, 2011
  7. Patrick Enders said:

    That’s about what I expect as far as actual legislative outcomes – which are my primary determinants of who I will (or won’t) vote for as a legislator.

    As it is, I see quite a few additional issues with this “if liberals would’ve voted for Ray Cox, everything would be better now” hypothesis. But keeping it to just three:

    First, it ignores any benefits that we liberals gained by being represented by Democrats between 2008 and 2010. As a liberal, I have every reason to believe that those difficult-to-quantify benefits in crafting legislation, and holding hearings, etc. would be greater than any that people who share my points-of-view might’ve gained by having Ray Cox serve as our representative from 2008-2010.

    Second, it assumes that the Ray Cox described above would have been nominated by the Republican Party in 2010. As it is, I see no reason to believe that Ray would’ve survived a 2010 Republican primary – either as a challenger, or as an incumbent. It seems to me that Ray’s 2010 choices were: 1) move far to the Right, 2) lose the Republican primary, or 3) not run.

    Third, even if Ray had somehow been elected in 2010 with his principles intact, I have no reason to think that a single Republican voice of dissent (and I’m not sure what Ray’s points of dissent are) would make any difference in the 2010-12 legislature. Rather, it would take a whole lot of reasonable Republican dissentors to create any meaningful “reasoned dialogue with some dissent from within the party [which] could have changed the outcome.”

    Bruce, I have voted for a handful of ‘reasonable’ Republicans in my day. I consider you to be one of those rare Reasonable Republicans, and I do wish you well in your efforts to reform your party. But at present, on the state and national level, every Republican legislator seems to have no choice but to vote in favor of every crazy bill the Republican Party brings up for a vote.

    So no, I have no regret for my vote for a Democrat in Jan 2008, in Nov. 2008, or in Nov. 2010.

    May 31, 2011
  8. I’d like to think Ray might have been a bit more skeptical of the marriage discrimination vote, or the Shoot First bill, or some of the other far-right legislation. But Bly was hardly radical either: clearly voters never felt strongly about one or the other. They were really quite similar, with Bly a bit more compatible with Northfield voters’ viewpoints.

    Griff, your reference to Tom Neuville being “moderate” is laughable. He supported a constitutional amendment to declare no right to abortion — and sought to restrict poor women’s access to the procedure. On his blog, he was a loud global warming skeptic. He supported a marriage discrimination amendment before it was even trendy. He might be a nice guy, but many of his political positions were just as far right as DeKruif.

    May 31, 2011
  9. Ray Cox said:

    Patrick, there have been many issues where I would have voted differently than Kelby or Al—because I’m not Kelby or Al. I would hope that Kelby and Al will vote with their hearts and heads as I did, not as someone in a party suggests that you vote. I’m proud of the fact that I can go to my maker knowing I cast every vote the way I wanted to.

    To answer your question specifically, I voted against putting the gay marriage issue to a vote of our constitution. I don’t believe it belongs in the constitution.
    I voted agianst the conceal and carry bill as I was concerned about the wrong people accessing guns accidentally or by someone giving them a firearm. (As it turns out, that issue was a bit of smoke and mirrors by the opposition as Minnesota has not had any signifcant problem with the Conceal and Carry legislation since its eneactment.)

    Those are just a couple of things that come to mind that are very close to legislation that was brought up while I was a legislator and also was brought up this year.

    Patrick, one other thing that was ‘gained’ by having the liberals in charge of the legislature was a deficit. They eliminated the surplus in the budget. If I recall, in 2007 the liberals took over a budget that had about $1 billion of surplus funds. That was all spent, resulting in additional deficits the next year, and contributed to the deficits we have this year.

    Lastly, you would be surprised what a single, sensible voice can do in the legislature, especially one that has 8 years of service. I greatly respected and listened carefully to several veteran legislators such as Dennis Ozment, Loren Solberg, Gene Pelowski, and many others.

    May 31, 2011
  10. rob hardy said:

    It seems to me that Ray (whose thoughtfulness on environmental issues always impressed me) was preceded in office by John Tuma, who was also (unless my memory fails me) a Republican, and who wrote this recent piece on “Minnesota’s Time-Tested Tradition of Partisan Bickering” for Conservation Minnesota. In any case, I wish other Republicans, like Ray and John, would remember that, in the days of Republican Theodore Roosevelt, protecting the environment was central to the identity of their party.

    May 31, 2011
  11. Patrick Enders said:


    I am glad that you hold a reasonable opinion regarding constitutional amendments to ban marriage between two consenting adults, and also that you voted against concealed carry. Those are both positions that I agree with. However those are also positions that, no doubt, David Bly and Kevin Dahle – or pretty much any old Democratic officeholder – would also hold. It is also a safe bet that David and Kevin would agree with me far more often than you regarding my many other political priorities.

    I am glad that you show signs of reasonableness, such as the ones you mentioned above. I also accept that I find your positions more palatable than those of many of your fellow Republicans – including Al DeKruif and Kelby Woodard. Clearly, you are more moderate than either of them.

    However, that wasn’t Griff’s argument. Griff’s argument was:

    1) Liberals largely voted for Kevin Dahle. (True.)

    2) If we liberals had instead voted for you, then you would’ve been elected (True – but unlikely, and very hypothetical).

    3) If elected in 2008, you would’ve also been reelected in 2010. (Both hypothetical and doubtful).

    4) If you had been elected in 2010, things in the Republican-dominated legislature would now be more reasonable, and I would be happier with the legislation that is now being passed. (Also unlikely – unless you can point to a vote where you would’ve tipped the scales to a different outcome.)

    5) Any benefit that we, as liberals, saw in Kevin Dahle’s service from 2008-2010 would be less than the benefit we might see from having you in office from 2008-2010+ (hypothetical, doubtful, and very hard to substantiate).

    It seems to me that the main reason that you are not presently our Representative or Senator is not the fault of liberals like me.

    Rather, the principal reason why you are not currently our elected representative is this: you did not run in 2010. I would also suggest that even if you had run, you would not have won a Republican nomination for office in 2010. Sadly, I don’t think you have much of a chance doing so in 2012, either.

    That’s not the fault of liberals like me. That’s an internal Republican issue, and I sincerely wish people like you and Bruce the best of luck in fixing your Republican Party.

    In the meantime, all I can say is:
    Thank goodness we managed to keep Emmer out of the Governor’s office.

    May 31, 2011
  12. Paul Zorn said:


    The present conservative hegemony in the Legislature is unquestionably “unintended” from any liberal perspective. But the idea that this result is somehow a “consequence” of liberal Northfielders’ votes strikes me as far-fetched. For one thing, it was conservative 25 and 25B votes that elected the present officeholders. For another, Ray Cox, undoubtedly more moderate than Kelby or Al, wasn’t on the ballot.

    The real cause of R vs D “gridlock”, IMO, is pretty simple: a few exceptions (Ray comes to mind) notwithstanding, the R side’s center of gravity has moved farther and farther right. I don’t think there’s much dispute about this even among R’s — watch T-Paw claw daily to the right, for instance, repudiating his own former positions.

    Whether or not Kelby, Al, David, and Kevin are good guys, love their families, and “vote their hearts and heads” rather than hew to some evil party line is less interesting to me than their positions on issues. So far I’ve found little to agree on with our incumbents.

    May 31, 2011
  13. BrucwWMorlan said:

    Paul Z., the drift in the politics of the Republicans is more of a drift toward the statist corner of a grid than a simple shift to the “right”. It is this more refined labeling using two dimensions, statist vs individual, economic vs personal, that informs a reasoned understanding of the 2010 election. In that 2-space (itself a gross simplification) I see coalitions of convenience that are dissolving even as we speak. I warned Republican politicians that if they let themselves be dragged to the statist corner of that spectrum they would leave behind many of the votes they needed to win the last election. Their reply to me is that I have “underestimated the power of the social statists (like the MCCL)”. I hope to see them proven wrong, IF the Democrats can field their own “Green Tea Party” candidates, candidates who are willing to stand against some of the statist hacks in the Democratic party to address the core issues the Tea Party has raised.

    May 31, 2011
  14. BrucwWMorlan said:

    And I am curious how you all feel about Pawlenty’s statement in Iowa that all subsidies are evil (oil, ethanol, the whole mess of them). A pretty principled statement to make in the heart of ethanol country, if you ask me. I presume you will dismiss it as political posturing.

    May 31, 2011
  15. Patrick Enders said:

    Where would you place the increasing Republican rejection of the scientific method on your two axis grid?

    June 1, 2011
  16. David Henson said:

    Bruce, I am not sure if you intend to but it seems you are divorcing reason and values. Social values must be based on reason and the great thinkers you espouse would be horrified by the values now be foisted upon our nation. Free speech has become misogynist MF this MF that lyrics, acceptance has become phallus worship, heroin is widely available in Mayberry, public funding is sell more alcohol and gambling, and questioning an “anything goes” mindset is anti-reason. The idea that all this can be ignored and a reasoned debate will bring about economic recovery is pure nonsense. Reason starts with defining social values … the current debate lacks maturity because reasonable people are not discussing values and what should and should not be generally acceptable. Science and historical values would show with crystalline clarity that sexual promiscuity, as an example, is a social (not individual) issue and has a massively negative impact on health and welfare. Yet reasonable conscientious ‘adults’ are doing nothing to reign in the media, advertisers,etc. The social agenda is not something reasonable people get around to as thinkers – the social agenda is the foundation upon which all other economic ideas etc are built.

    June 1, 2011
  17. kiffi summa said:

    Bruce: if you think the Republicans have it ‘right’ in their concerns over gov’t getting too big… and I think many have concerns over not just too big, but the waste within gov’t which could be considered to be endemic to ‘bigness’ … but I find it hard to square your support for smaller gov’t with the Republican social agendas of getting gov’t directly into persons’ private lives by wishing to legislate abortion and marriage rights.

    Is this involvement with peoples private lives not enlarging gov’t unnecessarily?

    June 1, 2011
  18. kiffi summa said:

    this is not about whether any of these legislators are “good guys’ or ‘bad guys’; it is only about what they vote to support.

    If they vote a party line, just for the sake of partisan politics , they are ‘bad guys’, IMO… because that means their party winning is more important than their principles, and they are possibly disenfranchising their voters.

    I think most people should, in a representative gov’t, vote for legislators that most closely align with the voter’s principles.

    Unfortunately, as these were the people who were elected , either the general populace is turning far more conservative, or it was just an unfortunate happening in a district that is always a close race.

    June 1, 2011
  19. Bruce Morlan said:

    Patrick, I would place it right next to the pollyannishly wishful thinking that the Democrats use when they pretend to think about using central planning to override freedoms and market choices. Wishful thinking reminiscent of Prohibition.

    June 1, 2011
  20. Paul Zorn said:


    There might be some advantage to thinking of political positions in more than one dimension, but I’m a little unclear about the “grid” you propose. If one dimension (horizontal, say) is statist vs individual, then what do you mean by the “statist corner“? Wouldn’t there be a statist edge, perhaps at the left of the grid? And what does the other (economic vs. personal) dimension mean?

    And, while we’re clarifying, what’s an example of a Tea Party “core issue” you’d like Democrats to address?

    June 1, 2011
  21. Patrick Enders said:

    Shorter version (minus the very separate issue of your characterization of Democratic economics):

    pollyannaish wishful thinking.

    The problem is, when the issue is climate change, the consequences of willfully ignoring the science are, well, pretty damned bad for the future wellbeing of humanity. Certainly much worse than the consequences of the failed attempt at prohibition.

    June 1, 2011
  22. Patrick Enders said:

    (Not to mention that the hostility towards science also undermines our ability to produce well-educated scientific innovators who might keep our economy moving, and who might help us find solutions to our various present and future problems.)

    June 1, 2011
  23. Paul Zorn said:


    My take on Pawlenty’s position on subsidies is that (a) it could hurt him in the obvious ways; (b) it could help him promote his chosen “truth-teller” persona. Whether (a) or (b) will win out can’t be known immediately, but I’d bet he and his handlers have done the calculation, however uncertain.

    So sure, there’s some political posturing going on. But some of that occurs in every campaign, and I don’t find this particularly instance especially blameworthy. Maybe Pawlenty really believes what he says, but it’s hard to credit as principled any utterance from a politician so visibly flailing rightward.

    June 1, 2011
  24. William Siemers said:

    David…I’m not sure if values are being ‘foisted’ on us by the media or if the media is more honestly reflecting society’s values. Was there less promiscuity and ‘phallus worship’ (whatever that is) when Ricky and Lucy were sleeping in separate beds? There was morphine and cocaine right here in Northfield a hundred years ago but proper folks didn’t talk about it, or felt it was none of their business. (Of course fewer people were dying from using it since it was legal and came with directions from the pharmacist on how to safely use it…but that’s another story.
    Anyway, I think dealing with what is generally considered the political ‘social agenda’ is, at this stage of the game, a dangerous waste of time. We have a political economic crisis and the way to deal with it is through debating economic issues (spending and taxes) not through debating whose social values are superior.

    June 1, 2011
  25. Ray Cox said:

    Kiffi, the government has been into our private lives decades ago. Bruce mentioned prohibition. We’ve had marriage definitions for years and years. Abortions were against the law for years and years….now, through a political and judicial process, most are legal. That doesn’t mean the issue is closed by a long shot. Since government has gone down the ‘slippery slope’ of legislating all sorts of these issues, we will continue to deal with them in the political theater.

    I totally agree with you that legislature work isn’t a popularity contest and shouldn’t be just about ‘who is a nice person’. I think we have had and continue to have excellent choices for our legislative candidates. I do think the present legislature and governor can use some help in brokering a deal to get a budget done. Minnesota does not need a massive government shutdown that is looming over us now.

    June 1, 2011
  26. David Henson said:

    William, I think there is a very direct link between gambling and the “get rich quick” lotto advertising and the decay of our economy. I think there is a direct link between the show “Weeds” and drug use and the decay of our economy. Public policy can and has changed values and re-enforced positive values and needs to again urgently. Good people are sitting back and letting fools take over and the results are quite what one would expect. Somewhat more central control of values and vastly less central control of the economy has been a recipe that created great wealth in this country. People are happier with some adult morals socially encoded and building proper roads and bridges than with the highly misguided (if not evil) system we have evolved where every vice is promoted to every citizen dozens of times each day.

    June 1, 2011
  27. David Ludescher said:


    Who, or what, can provide help to the legislature and the governor in brokering a deal? It strikes me that this kind of gridlock is the inevitable result of a two party system.

    June 1, 2011
  28. All I can say more broken promises for Long-Term Care and the Elderly : I will not blame Governor Dayton for a shutdown : But I hope to find a candidate once and for all to support Long-Term Care : How do we trust our leadership when they ask for the vote and so entrenched in Party Lines : I did vote for marriage issue I did not vote for the abortion issue : I voted for proper funding once and for all for Long-Term Care: And I did not vote for a new Viking Stadium the state house under Kurt Zellers should be ashamed : Shutdown here we come Thanks to the State House : That is how I feel :

    June 1, 2011
  29. Ray Cox said:

    David L, you are correct that this is often the result of a two party system. Special sessions are not really special any longer….they are normal. I think it is wise of Gov. Dayton not to call lawmakers immediately back to work. Let them get back into their districts and talk to people. I got a notice that Kelby Woodard is doing some meetings—that is the sort of thing that will help cool the whole process down a notch or two.

    I plan to meet with a couple of ex-legislators next week and go over some ideas about the ‘end game’ of getting the budget resolved. Hopefully if we can create a decent plan we can meet and pitch it to legislative leaders and get their reaction.

    Right now time off for most legislators seems to be a good thing, but the leadership and Dayton need to continue to explore ideas daily.

    June 2, 2011
  30. William Siemers said:

    People gamble. They have always gambled. It makes sense for the state to get revenue from this ‘sin’. And if they are going to do that, they might as well promote their gambling alternative, just as others promote theirs. Placing a small bet is a simple, affordable, entertainment for most folks who then go about their daily lives as productive citizens. I’ll suggest that the state should, likewise, come to its senses about marijuana use, and start making money from this relatively benign pleasure as well.

    I fail to see how your values deserve state ‘re-enforcement while my values (and rights) should be denied.

    June 2, 2011
  31. William Siemers said:

    I agree that long-term care assistance for those in need, should continue to be provided for those currently on the program and for those close to the age where they might need it. But like many programs it needs to change in the future for younger citizens. Long term care insurance exists. I fail to see why the state should continue to provide this benefit for those currently below the age of, say, 55, when insurance for that possible eventuality is affordably available.

    June 2, 2011
  32. David Henson said:

    William, there was no gambling in MN during periods in my lifetime and the state was solvent. Now we are deep into it and bankrupt. Values that lead to negative outcomes for all citizens can not be considered acceptable because a few immature adults “want to do them.” The baby boom generation has not banked for its future and used silly social funding methods like lotto and now true to its name is crying at the results. The time to become an adult generation is now. Hint: legalizing more drugs is not the answer.

    June 2, 2011
  33. David Henson said:

    Phil, church bingo excepted. This does not change the fact that the massive institutionalization of “sin” has not been the answer to prudent public policy.

    June 2, 2011
  34. Phil Poyner said:

    Got it…gambling is only a “sin” when it happens outside of the church.

    June 2, 2011
  35. David Henson said:

    Phil, scale matters – a poke with a pin is not the same as being run through by a spear. I don’t recall every hearing of public officials embezzling funds to cover their addiction to bingo at Jesse James Days. And the bingo lobby is not out to get Dayton’s support to answer MN problems by building a massive bingo parlor in downtown Mpls. The governor needs to see that a new sin will not right our path. Product development, manufacturing, new agricultural products, etc can right our path … but it is hard work and not a quick fix.

    June 2, 2011
  36. Phil Poyner said:

    David, I’m afraid you may be on a slippery slope regarding sin. The argument of scale would also imply that there are certain levels of adultery one might commit without being considered a sinner, but I’m pretty sure my religious friends don’t see it that way. You may want to argue your point from the perspective of public or societal interest rather than sin. After all, in a country with religious diversity, reaching consensus on what is “sin” can be near impossible.

    June 2, 2011
  37. David Henson said:

    Phil, “Sin” was Williams word, my use was a follow up. But I would guess your religious friends could tell the difference between a kiss on the cheek and the gambling orgy now promoted in MN. I would describe the government lotto and casinos exploiting the poor as simply a disgrace (and very bad public policy).

    June 2, 2011
  38. Paul Zorn said:

    David L and Ray,

    Yes, we have a two-party system; and yes, the parties are for the moment at an impasse. But I don’t follow the logic of attributing the latter to the former.

    True, a one-party system might get things done more expeditiously, but I doubt you’re advocating that. Would three or more parties somehow help clear these logjams? How?

    June 2, 2011
  39. David Ludescher said:


    … the parties are for the moment at an impasse.

    I think this summarizes the primary reason that there is gridlock.

    I think that it is fair to say that the Minnesota legislative process is dominated by Democratic bills and Republican bills rather than by bills dealing with a particular legislative ideology.

    June 3, 2011
  40. This weekend Ralph Reed and his Jesus people are going to have their convention : Can Someone please tell me Why Gay marriage would bring down the Economy? or why Abortion do the same? I do not see how these issues and the economy fit together so the conservatives are telling us that gay people’s money is no good ? WWJD Think about it

    June 3, 2011
  41. john george said:

    David R.- This boils down to two different foundations of faith. The Christian foundation is built upon scriptural admonitions of an active God who is concerned about His creation and His people. He does hold to His word, that judgement will come to those who forsake His ways. It is not that He is waiting to hurl lightning bolts at us. We need to remember that it is He who holds back the evil that has infiltrated His creation. Judgement is simply the lifting of this protection that we all take for granted, and most are not even aware of it. So, since the scripture says He holds all thing together, our focus is on obeying Him, and we recognize that there are consequences for our actions. We do not want Him to allow things to fall apart.

    The other foundation of belief centers in Secular Humanism, that man determines his own destiny. If you believe there is no God, then homosexuality and abortion have no moral implications. Homosexuality can be compared to skin color and ethnicity and abortion centers on the “right” of the woman to decide what to do with the lump of tissue growing in her body. If there is no God, then who cares what happens to this tissue or how people live? There are no consequences for either pattern of life.

    June 3, 2011
  42. john george said:

    David R- WWJD? Remember, when the woman caught in adultery was brought to Him, he did not deny her sin, nor did she. He forgave her of her sin, and told her to go and sin no more. The same offer is extended to us today. We need only to respond.

    June 3, 2011
  43. A reply to 16.1 : I loked up the site it still does not explain the Gay marriage effect on the economy : We need to focus on Economic Growth and Jobs and stop quibbling about the social issues (They should not reflect how we go about judging others): We also need to look out for our most vulnerable WWJD :

    June 3, 2011
  44. kiffi summa said:

    John: I swore that I would never argue again with you about either homosexuality or abortion, but you have in my opinion, crossed a ‘not-to-be-tolerated’ line when you say that a woman must have a God in order to care about the life that grows within her body. That is an unbelievably offensive statement.

    You say “homosexuality can be compared to skin color or ethnicity”; surely you know that neither of those can be the basis of discrimination… so how do you then evaluate homosexuality as being in need of redemption?

    If you want to see the pain and angst brought on in a teen because of her struggles with social values and the conflicts she experiences in ‘squaring’ what she may be feeling/experiencing along with the teachings of her family, then go look at Aimee Clites’s artwork in the Senior High School honors show at the NAG.

    June 3, 2011
  45. john george said:

    Sorry, Kiffi, but I did not say what you are attributing to me in this statement,

    “…you say that a woman must have a God in order to care about the life that groes within her body.”

    In answer to your question about homosexuality, I say that homosexuality is in need of redemption because that is what I read in the Scriptures.

    There is a Proverb, in fact, two references- 22:28 and 23:10, admonishing us not to move the ancient boundaries established by the forefathers. Redefining homosexuality as an acceptable God approved lifestyle defies the scriptural boundaries that have been set. If we proceed in the direction in which we seem to be careening, I believe we will precipitate the lifting of God’s protection over us, and the economic arena may be where we are affected. This is foundational to my answer to David R’s question about why approval of the homosexual lifestyle and abortion might affect our economic wellbeing.

    I believe the Biblical account is the inspired word of God. If I have interpreted your comments correctly, you do not. We each have our own right to base our convictions on what we believe and support our arguments accordingly. The beliefs you have expressed on this blog are neither a threat nor an offense to me. My concern is that my beliefs are both to you. That is unfortunate, but I am not going to change them because of your opinion of them.

    June 3, 2011
  46. kiffi summa said:

    OK, John.. anyone can read your #16.2 and decide for themselves what you are implying by your statements there…

    But could you please NOT bring what seem to be your two favorite ’causes’, abortion and homosexuality, into every discussion?
    Moral implications exist in every issue , whether or not there is the particular God in which you believe.

    I would like to just read what others think of the current situation at the Capitol.

    June 4, 2011
  47. Michele Bachmann and Sarah Palin and Ralph Reed must be the Antichrist? Is this the best the Republicans have to offer ? We are in trouble :

    June 4, 2011
  48. Phil Poyner said:

    I was listening to a segment on NPR yesterday about politics and religion. There was a repeat of an old Jon Stewart quote: “For many Americans, most Americans, religion is a proxy for morality.” It was made in reference to how we select candidates. I figured since this thread started about politics (Really, Griff? Liberals voting for candidates they share values with caused the gridlock? A little simplistic, don’t you think?) and morphed into religion, I’d present that thought as a possible bridge over the gap!

    Discuss amongst yourselves…

    June 4, 2011
  49. john george said:

    Kiffi- Take a look at David R’s post 16. I think you’ll see the source of the subject matter. I thought his question was worthy of an answer, and I didn’t expect you to interject yourself into my exchange with him.

    David R- I notice you have not responded to my answer. Does this mean my explanation brought you clarity, or was I just duped by a rhetorical question?

    June 4, 2011
  50. kiffi summa said:

    I vote whole heartedly for back to the politics… except that religious values keep inserting themselves … sorry, bad writing, the religious values do not insert themselves…people keep inserting their religious values into political discussions, and then say you may not question them because their religious views are not to be questioned, as they are personal beliefs.

    Too, too convoluted…

    I think it is a ridiculous premise to say that Woodard and deKruif are there because ‘liberals’ voted for them; I would like to see numbers that prove that supposition.

    I don’t know any ‘liberals’ that would have voted for our current state reps; I believe this is always a close call district, and democrats were either complacent, or less efficient at getting out the vote , or it was just a republican plurality this time.

    Anyone have numbers on precinct by precinct analysis?

    June 4, 2011
  51. David Henson said:

    “Those who say religion has nothing to do with politics do not know what religion is.” ~Mahatma Gandhi

    June 5, 2011
  52. FOX News today : Fair and balanced reporting? Today Sarah Palin had to make the soup and correct herself on American History and said she was not stepping on Romney’s toes with a smirk : What a character

    June 5, 2011
  53. The Republicans are like little puppies pissing on themselves for approval from Bachmann : Palin : Rush : Glen B : These four do not speak for the whole country : They need to get less polarized in their way of thinking: Shutdown here we come

    June 5, 2011
  54. john george said:

    The gridlock in St. Paul is not much different than the discussions on this blog, IMO. There is extremism on both sides. Ideology seems to be more important than trying to find common ground. I don’t have to agree with everything someone believes to work with them, and I don’t expect others to agree with everything I believe, either. I think that if there was more emphasis on addressing the problems confronting our budget woes rather than casting blame, then the legislature could possibly make some progress toward a solution. When there is not enough grass to support everyones’ sacred cow, then some of them either have to be slaughtered or the whole herd will die. This is where the choices become difficult.

    June 6, 2011
  55. David Ludescher said:

    Personally, I think the gridlock is a good sign that government is working.

    June 6, 2011
  56. David Henson said:

    Gridlock: A traffic jam in which no vehicular movement is possible

    MN Gov’t expenditures: $37,090,000,000

    I question the gridlock analogy. Would we spend more or less than $37 billion without gridlock ?

    June 6, 2011
  57. john george said:

    David H- I think you have a point, there. I think that what we are dealing with is an extreme polarization of political philosophies. There is a segment of the population that disdains BIG government, and they have drawn a line in the sand. Those who want to cross this line provoke a pretty extreme reaction from them. I liken it to trying to control creeping charlie in your back yard. The only way to do it is to kill off some plants. In the past, part of the compromise was to allow a little growth as a trade off for spending controls. What this has precipitated is a bunch of unfunded mandates by the government. Now, it seems, both major parties have bought into the BIG government philosophy, and a lot of people are feeling disenfranchised. This, along with our penchant for having to have a term for everyone/thing has eroded our ability to talk civily with one another and come to understanding and agreement. Rather than having a common goal, to make America strong, I see multiple goals precipitated by the whole global economic trend we are in, and that stifles nationalism. We have a leader now who looks to European models for government rather than our constitution and history. Years ago, someone wrote that the world will not end with a bang, but a sigh. I hope I don’t see it in my day, but some days, it seems it is getting closer.

    June 6, 2011
  58. David Henson said:

    John – we may need the equivalent of an Arab spring here at home. The problem with democracy that is dominated by special interests and party politics (remember the founders hated parties knowing the evils) is we have no visible dictator to hunt into a fox hole. We have 1000s of dictators playing hot potato. Most rational people just want to leave it alone (even when their assets disappear) so we see messianic leaders rising on the fringe. People are literally considering large downtown casinos as a way to bail out a $5 billion a year budget hole. Super debt, lotto tickets, printing money – I think we have to stop and say this is now a banana republic. Do we want to band aid together a banana republic or decide on a civil way to jettison this system and continue to build a great country.

    June 6, 2011
  59. john george said:

    David H- Even bananas have appeal. This situation doesn’t, at least for me, no matter how I look at it. Perhaps I can go live with my brother in Red Neck country with his basement arsenal.

    June 6, 2011
  60. William Siemers said:

    The latest right wing talking point is that Obama “looks to European models for government rather than our constitution and history”. It does not really have any basis in fact. It’s just the newest spin on the ‘Obama is not a real American’ crap that Fox News has been spewing since he was elected.

    June 6, 2011
  61. john george said:

    William- Here is a quote from a speach Obama gave in Germany:

    In America, there is a failure to appreciate Europe’s leading role in the world,” he said in a prepared speech delivered before a campaign-style town hall meeting in which he took questions from mainly French and German students.

    “Instead of celebrating your dynamic union and seeking to partner with you to meet common challenges, there have been times where America has shown arrogance and been dismissive, even derisive.”

    He then followed it up with this statement:

    “In Europe, there is an anti-Americanism that is at once casual, but can also be insidious. Instead of recognising the good that America so often does in the world, there have been times where Europeans choose to blame America for much of what is bad.”

    My take on these comments is that they lean toward globalism rather than nationalism. There is just enough separatist in me to be wary of these sentiments, but that is just my opinion. Time will tell where we end up, and that destination is out of my control.

    June 6, 2011
  62. Phil Poyner said:

    John, it looks to me that you heard what you wanted to hear in the Presidents remarks. There is nothing there to suggest that he wishes to emulate current European models of government at all. What I DID see was a president that was repairing some of the ill-will created during the previous administration when Donald Rumsfeld dismissively referred to Germany and France as “Old Europe”. The NATO alliance helped win the Cold War…I’d say preserving that alliance is in our National Interest.

    June 7, 2011
  63. Sarah Palin Needs some History Lessons : Ride that Pony Sarah

    June 7, 2011
  64. john george said:

    Phil- We all filter what we hear through what we believe. What won the cold war was Russia’s turning from a communistic totalitarian system to a capitalistic democratic system.

    June 7, 2011
  65. Phil Poyner said:

    John, the Russians didn’t turn “from a communistic totalitarian system to a capitalistic democratic system”. That statement implies a level of willingness that wasn’t there. Their economic and political system essentially collapsed. The reasons for that collapse were many and varied, and their sources were both internal and external to the country.

    Their military costs, a response to “threats” from China and the NATO alliance, consumed a quarter of their GNP. That expense created economic stagnation, and was made even worse when the oil glut of the 1980’s cut into Soviet oil revenues. Gorbachev presented an agenda of economic reform called perestroika, or restructuring, in an attempt to reverse the deteriorating economic situation. As a way to fight off internal opposition from party cliques to his reforms, he simultaneously introduced glasnost, or openness, which increased freedom of the press and the transparency of state institutions. Glasnost weakened the bonds that held the Soviet Union together, not to mention the Warsaw Pact. And, in a nutshell, that was “all she wrote”. The system collapsed, and at least one of the major causes of that collapse can be traced back to an economy designed the address the NATO “threat”.

    I have only two words to say to anyone that believes Russia embraced a “capitalistic democratic system”: Vladimir Putin. Even the conservative Wall Street Journal has referred to Putin as a “despot”.

    June 7, 2011
  66. john george said:

    Phil- All the things you list had a cumulative effect on what happened in Russia. I just simplified the result. I think Gorbechev was an opportunist. He could have gone the way of Stalin and enforced an even firmer hand upon the people, but he didn’t. The existing system was collapsing. He saw what worked, albiet not smoothly, in the west and decided to give it a try. I’ve traveled in Russia, and the older generation thinks things are worse now that when Breschnev was in power. The younger generation all think it is better, because they can say what they think without being shot, and they can actually see a return for their labors. Neither capitalism nor communism is a panacea, but I’ll still take the freedoms we (still) have in America. But, I don’t agree with your contention that NATO forced perestroika or glastnost.

    June 7, 2011
  67. Phil Poyner said:

    John, don’t put words in my mouth. I never said “NATO forced perestroika or glastnost”. What I said was “at least one of the major causes of that collapse can be traced back to an economy designed the address the NATO “threat””. That shows my recognition that there were other factors, such as the Soviets underestimating the degree to which the non-Russian ethnic groups in the country would resist assimilation into a Russianized State, and how the ideology of Communism, which the Soviet Government worked to instill in the hearts and minds of its population, never took firm root, and eventually lost whatever influence it had originally carried. If you wish to disagree with me about the relative impact of the NATO alliance on economic conditions, or even on the impact of economic conditions on the collapse of the USSR, then fine.

    Going back through this thread some, I obviously see our European alliances as being valuable (as they were during the Cold War). I’m not alone in thinking that. To me it just makes sense to cultivate a good relationship with the European Union, at the very least at a trade level, and I see the President’s comments as striving to foster that relationship. I do not see it as an endorsement of their political model, and there doesn’t appear to be any basis in fact to believe otherwise.

    June 7, 2011
  68. john george said:

    Phil- Sorry, I guess I misinterpreted your comment here in 23.1.5-
    ” The NATO alliance helped win the Cold War…I’d say preserving that alliance is in our National Interest.”
    I don’t think we should dump our allies, either. One mistake I made here is confusing NATO with the UN. They are two separate entities, and that is my mistake. I believe there is a one-world government coming. I just don’t want to hasten its arrival.

    June 7, 2011
  69. Ray Cox said:

    One of the issues with our legislative system is that with divided government we essentially have to get our legisaltors and executive branch to get along and find a solution to our issues. That is not always easy.

    One way to look at the issue is this: The Governor of a state is essentially equal to the Chief Executive Officer (CEO) of the ‘company’ (state). The legislature is equal to a Board of Directors or Board of Regents for the ‘company’ (state). What we have going on now in Minnesota is a CEO that is saying to his Board “I want to spend $36 billion and to do that I want to raise added revenue (taxes)” to which the Board says “We are not comfortable with that plan but we are comfortable using all our projected revenue and spending $34 billion”.
    When a CEO and a Board reach a position like this in the business world, the CEO typically has two choices: 1) Defer to his Board and go with the Board plan, or 2) Leave the company due to differences of opinion on the direction the company is headed.

    We see many times where CEO’s leave companies due to differences of opinions. The same system holds true for schools with the Superintendents as CEO. They often leave districts when the are not in agreement with their Boards.

    I don’t know what the end result of crafting our budget will be, but I do know how CEO’s and Boards interact.

    June 8, 2011
  70. Paul Zorn said:

    David H:

    In #23 above mention this figure:

    MN Gov’t expenditures: $37,090,000,000

    Can you explain and/or give a reference for this number? I haven’t seen it mentioned elsewhere. Whose calculation is it, and what does it include?

    June 10, 2011
  71. Paul Zorn said:


    Analogies are never perfect, granted, but even allowing for that I find the governor-as-CEO analogy unconvincing.
    States and companies, although not totally dissimilar, differ in ways that matter crucially in this discussion.

    One is that Minnesota, unlike a company, can’t go out of business, change its line of work, declare bankruptcy, or just quit bothering with, say, education, because it’s “unprofitable”.

    Another is that both of the two CEO choices you mention amount, in effect, to capitulating to the Board. This is certainly not what I’d want from a Governor — and expecting it as a matter of course violates, big time, the spirit of separation of legislative and executive powers.

    Governor Pawlenty, by the way, neither resigned nor acceded to the Legislature when they disagreed. He tried some dodgy unallocation maneuvers and got slapped down by the courts.

    June 10, 2011
  72. john george said:

    Paul Z- I’ve only heard round figures on this, $34 billion for the Republicans & $36 billion for the Democrats. I know you mathmaticians deal with these types of numbers more than I do, but I figure that when you get up that high, what is another billion or two here or there? When we are talking about spending more than what is projected to come into the coffers, I figure it doesn’t make much difference how much more we spend. Deficit spending is just that- spending money we don’t have. We are already taking money out of programs for the unemployed and elderly. What bothers me the most is that we are still spending money to study the feathered ear owl’s habitat. It boils down to a difference in priorities, I guess.

    June 10, 2011
  73. Paul Zorn said:

    John G:

    I don’t get your point about owls.

    The difficulty we all feel with numbers like $32B, $34B, and $36B has less to do with mathematics — these are just plain numbers, after all — than with vague, political, and sometimes disingenuous definitions of the numbers themselves.

    For instance, Minnesota Republicans propose a $34B budget for the next biennium, and keep describing it as a 6% increase over current biennium state spending, supposedly $32B.

    Yes, 34 is (about) 6% more than 32, but the calculation is essentially bogus, because (as far as I can tell) the numbers 32 and 34 don’t measure the same thing. Spending in the current biennium (according to the MinnPost article cited in 26.2) will actually total around $34.5B if we include something like $2.3B in federal stimulus funds. (We should include these funds, which were actually spent, in any apples-to-apples comparison of spending in the next biennium.)

    Another problem with the 32 vs 34 calculation is that the former appears to omit $1.89 billion in school funds that was obligated but not spent in the present biennium, but (as far as I can tell) no such evasion is planned for the next biennium.

    Bottom line: Holding spending to $34B in the next biennium may be wise or foolish. But it’s not a 6% increase.

    June 11, 2011
  74. john george said:

    Paul Z.- My whole point is priorities, what do we spend 32 or 34 or 36 billion dollars upon. The feathered ear owl is just my made up example of what, IMO, are foolish expenditures. You bring up a good point with the school appropriations. My wife experiences this in her profession all the time. The legislature passes what I call unfunded mandates, especially in human resources. It comes out with all these requirements and standards of care for nursing homes to emplement, but it does not provide any money for them to pay anyone to accomplish the requirements. Since most care for most seniors in nursing care is state/federally funded, then the staff usually takes a pay cut to free up money needed to provide services. It all sounds good on paper, but in reality, these programs just aren’t there.

    June 12, 2011
  75. David Henson said:

    Paul, my point was “gridlock” does not describe well a situation in which the parties agree to spend 10s of billions of dollars. The state numbers (not including federal -maybe not even local) appear to me to be about $7500. per person in MN. If the total spending, all in, approaches say $30,000 per person in the US then I am not sure the vast majority would not prefer to each pocket $30,000 and work out their social needs privately.

    Maybe it is just me but if I went to the bowling alley in Northfield and the lanes were full of holes I would think few consumers would spend dollars with them. But I drive up 35W (the gateway to MN and Mpls) and the lanes are full of potholes and cracks. If government cannot even get this most needed and visible service correct then what are the chances the less visible services are actually being done well (meaning a fair value)?

    I am sorry but the levels and methods we use to fund government just do not work – and given a choice I think many people would opt out all together.

    June 12, 2011
  76. John George is 100% correct our staffs have faced a four year wage freeze and the cost of their benefits go up: We need lessen the pressure of unfunded mandates in Long-Term Care or we will lose valuable people like Mrs. George and other who dedicate their work for Long-Term Care : These people are amazing they also feel that they are not listened to by our lawmakers : Right on George Thanks someone finally gets it:

    June 12, 2011
  77. Paul Zorn said:

    John G,

    In 26.1.2 you refer to “foolish expenditures”, but gave only a fictitious example. Could you give a real, substantial, systematic example, or category of examples, of what you see as foolish state expenditures?

    As you say, priorities matter. Do you think the state has the wrong priorities? If so, what would you change? (Most of your posting reads to me like a plea for additional funding. Right on!)

    June 13, 2011
  78. john george said:

    Paul Z.- Two categories that I feel have not reflected responsible spending limits are some environmental issues and the Vikings stadium. The stadium is simple, at least to me. I recognize that there will be a certain financial benefit to the hospitality industry in the Twin Cities if a new stadium is built, but I have a problem giving money away to a multi-millionaire. The term “welfare for the rich” is applicable here, IMO.

    And, while on the subject of welfare for the rich, another investment, on the Federal level, was the use of billions of dollars to bail out the financial industry. I know that some investment firms have paid back monies they recieved, and some money was never expended in the first place. But, just the fact that this amount of money was tied up to begin with smacks of unwise financial management to benefit a few.

    As far as the environmental expenditures, this is a little more difficult to ferret out, and there is a subjective side to it. I question how much state money we should be throwing at alternative energy ideas when there is really no track record on some systems. There is a really good editorial by Robert Brice in the last Sunday Strib.
    If you note in the article, there is a threat to the dessert tortoise (sorry, no mention of owls, but I’m sure they will be threatened somehow) by the Mojave Dessert solar energy project. Also, if this type of installation was done in an area susceptable to rainfall, can you imagine the run-off caused by 5 square miles of solar panels? It makes the concerns over Rejoice!’s parking lot pale in comparison. And, all this for 370 megawatta of electricity.

    Another subsidy that was applied involved the production of ethanol as an alternate “green” renewable energy source. This has proven problematic for a number of reasons. A gallon of ehtanol does not produce the energy of a gallon of gasoline. When the subsidy is removed, the production is not profitable. It still takes a lot of petroleum based products (fuel, pesticides, herbicides) to raise the renewable corn. I feel the state money put into this was a waste of taxpayer dollars.

    IMO, all these things add up to robbing the taxpayers of necessary services, ie: roads, elderly care, services for the poor, education, and infrastructure in general.

    June 13, 2011
  79. Paul Zorn said:


    I don’t think either the Republican or the Democratic proposed budget includes any state subsidy for a Vikings stadium, so that (interesting) issue seems moot in the present discussion. Nor do I see any connection between the federal bailout/stimulus and Minnesota budgeting — except in the sense that federal stimulus funds helped get Minnesota through the present biennium. (The fact that most economists regard the stimulus as successful on balance is also peripheral to this discussion.)

    You raise better and more relevant questions, IMO, in relation to ethanol, support of alternative energies, etc., on which reasonable people differ. And, of course, some alternative energy technologies may better deserve support than others.

    But here, too, the question of federal vs state subsidies arises. Do you know how much the state budgets for such things? I’m guessing it’s small compared to the big-ticket items like transportation, human services, and education. So it seems a stretch to describe environmental programs as robbing taxpayers of necessary services.

    June 13, 2011
  80. john george said:

    Paul Z.: Here is a ;ink from today’s Strib about state contributions to the stadium in the state budget:

    Please note this paragraph here:

    “Even before they had revealed the funding plan to reporters, however, the Minnesota Department of Transportation had indicated that any state money used for roads near the stadium would count against the $300 million maximum state contribution that Gov. Mark Dayton has set for a stadium.”

    This $300 million alone is about 2/3 of what was cut from Human Services.

    As far as state energy subsidies, take a look at this study: Subsidies

    You tell me if the state subsidizes energy or not? It appears to be one of those “fees, if you will, that contribute to the utility and communications bills we pay every month.

    As far as federal subsidies, here is a link breaking down the $223+ million the federal government gave back to Minnesota for energy subsidies:

    If you read the whole article, there are additional tax deductions available to home owners for installin energy saving windows, heating, stc.

    This link gives us a little insight into what subsidies for ethanol production only cost the Mn. taxpayer until the end of 2010

    I have not been able to find up to date figures of what total state subsidies are being proposed in the new budget.

    June 13, 2011
  81. Both parties will probably sneak public funding for a stadium though they promised us not a stadium this session when everyone in small business and Nursing Homes have sacraficed the most by regulations and lack of funding or even a fairness in the tax code for small business : To all the Bachmann supporters where is her substance (How will she make government work better I don’t think she has a plan Good Luck America)

    June 14, 2011
  82. Paul Zorn said:


    Sure, the state would incur expenses (e.g., for road improvements) associated to a new stadium. (The state incurs expenses for other forms of development, too, of course.) Presumably the state would also get some tax revenue out of such a stadium, and stadium proponents like to predict various economic spinoff benefits.

    An interesting discussion might center on stadia, but I think it’s peripheral to our main point here — state funding for the 2012-14 biennium. The $300 million figure Gov Dayton has mentioned as an upper bound is a big number, but it’s both unlikely to be spent in a single biennium and (as indicated above) would be at least partly offset on the credit side.

    (I can’t resist the also-peripheral observation that former president GW Bush made his fortune largely through public subsidy of the Texas Rangers stadium.)

    As for alternative energy … Yes of course the state subsidizes it. (As you may recall, Tim Pawlenty, of all people, championed this issue before his recent apostasy on environmental issues.) But (i) subsidies appear to be modest; (ii) reducing petroleum-based effluents has benefits, not just costs; (iii) we’ve been subsidizing conventional energy production (e.g., through absorbing environmental costs) since forever.

    June 14, 2011
  83. Paul Zorn said:

    Following up on several earlier postings …

    Today’s Strib has an editorial

    with useful numbers on the R and D budget plans. IMO these numbers point up, again (see, e.g., 26.1.1), the bogus-ness of the Republicans spinning their $34B proposed budget as a 6% increase. If the editorial tells it true, even R leaders are backing off this description.

    June 14, 2011
  84. David Ludescher said:


    I don’t see how the Strib’s numbers are “useful”.

    The useful numbers are the actual amounts of revenue and expenses. In the past, budgets have been not been balanced. Those accounting shifts and federal stimulus money are now catching up to us – much like credit cards. If we don’t have the federal money and the accounting shifts, then that revenue isn’t there to spend.

    The percentage increase or decrease is irrelevant.

    June 14, 2011
  85. Paul Zorn said:

    David L,

    The numbers offer useful perspective — in judging the Republicans’ claim of a 6% increase, in understanding what goes into state spending and revenue, and in predicting how programs’ futures may compare with their pasts. That you could find such things “irrelevant” baffles me, so perhaps I miss your point.

    If you mean that budgets should be approached without smoke, mirrors, linguistic gimmicks, and undue reliance on one-time occurrences, I’m with you (and we’re both against our former Governor). For me, such due diligence argues for more, not less, attention to numbers, and to realistic assessments of both costs and benefits of state programs.

    June 14, 2011
  86. Ray Cox said:

    Paul, budgets have used “smoke, mirrors and linguistic gimmicks” for decades. They don’t need to use them when money is rolling in like water over a dam. But when times get tough the gimicks pop up quickly…and from any party.

    But, like you, I do prefer to focus on numbers….mainly two numbers are important for me. #1 is the amount of expected revenue that the state is expected to receive to fund the general fund in the biennium. Right now that undisuputed number is $34 billion—something I believe all parties can agree on.
    The second important number is the spending contained in the proposed budgets. Right now the Republicans have proposed spending $34 billion and Gov Dayton has proposed spending $36 billion. Just relying on common sense, I’m lining up behind the $34 billion spending plan as it doesn’t push us beyond our existing revenue. It also does not repay the school shift, but I’ll go down that route for now anticpating better times to come where we can repay the shift. I’ve had it on good authority that Minnesota’s general fund revenue is projected to increase about $700 million above the $34 billion forecast. I expect some of that could be used to repay the school shift….unless things turn again for the worse.

    I certainly hope we avoid a government shut down. If we do not, this shut down will be much larger than the 2005 shut down when many budget divisions were already financed.

    Regarding the CEO/Board anology, the big difference between 2005 and 2001 is now the legislature is controlled by Republicans, and the Governor is a Democrat. In 2005 the legislature itself was significantly divided and that is the main reason the legislature could not arrive at a budget. This year the legislature did arrive at a budget—the Governor happened to veto it.

    June 14, 2011
  87. john george said:

    Ray- I think you have hit the nail on the head. We just don’t have enough dam water for the Governor’s budget. Ten years from now, though, it will just be water over the dam, anyway.

    June 14, 2011
  88. David Ludescher said:


    The Strib’s editorial puts a reverse spin on the same numbers without providing any relevant data on whether the Republicans have put forward a responsible budget. The Democrat scare is that Republicans are slashing the budget and hurting poor people. But, the numbers suggest that contrary to those claims, the expense of government continues to rise even as the fortunes of most Minnesotans has decreased.

    June 14, 2011
  89. Paul Zorn said:


    Yes, let’s focus on numbers.

    As far as I know $34bn is indeed the state’s predicted biennial income under the present tax rates and structure. Thus, any plan to spend more than that, say $36bn, must include tax changes or better-than-predicted tax receipts or divine intervention or pixie dust or some combination of these. That’s why Governor Dayton, eschewing magical means, has proposed some … uh … revenue enhancement. Leaving aside for the moment whether proposing any new taxation is wise, we should agree that it takes some courage, and presents a bracing contrast to his predecessor shifts, feints, and piggy-bank-smashing.

    Is $34bn the right target figure for state spending? That’s by no means clear. The whole point of state spending, after all, is not to spend money but to buy stuff and to invest in our state’s future productivity. Underfunding productive investments (education at all levels, infrastructure, environmental mitigation, a decent provision for the poor, etc.) can be expensive, too, both economically and in terms of doing the right thing.

    June 14, 2011
  90. David Ludescher said:


    I don’t think it takes any courage for a government official to propose taxing the richest 2% of Minnesotans. I agree that it is by no means clear that $34 billion is the best number. But, if there is any doubt, $34 billion is better than $37 billion.

    One thing we can agree upon is that the marginal utility of the last $1 billion is less than all of the other $1 billions, and that the additional $3 billion in revenue is the least expendable to the taxpayer.

    June 14, 2011
  91. john george said:

    Paul- To some of us fiscal conservatives, it seems illogical to spend more than you have coming in. IMO,the philosophy behind this is to find a way to get the “rich” to part with more of their money. I have heard it called “paying their fair share.”

    My son attended an interesting meeting in Grand Forks earlier this year about paying your fair share. He caused quite a stir (probably takes after his father) when he got up and shared his experience with his income taxes. Two years ago, just because of his job change, their move, and an additional child born in December, he actually got back as a refund $11.00 for every dollar that was withheld from his paycheck. His perspective is that he is not poor, and he feels he can carry his fair share, also. He said he was insulted by this involuntary welfare he recieved. As you can imagine, this caused quite a stir at the meeting. He was even interviewed by the media. The point here is that a lot of people paid in a lot of money to allow this amount to be paid out. This is just one example. How many thousands of similar families across the nation had this same experience? I think it is this type of imbalance that demonstrates the inequities of our current tax system and has disgusted a lot of people. For the governor to come along and say, “Oh, we’ll just take a little more from the rich,” when we have this type of thing going on is an insult.

    June 14, 2011
  92. Paul Zorn said:


    This particular Strib editorial (as opposed to others) was not about whether the Republican budget is wise or responsible. It was about whether the 6% spin applied by many (not all, as the editorial points out) Republicans stands up to examination. It doesn’t.

    Nor was the Strib piece about whether the R’s budget would hurt the poor. I think it would, but either way, the logic of your last sentence escapes me. It’s sad but predictable that in hard times more people need government help.

    Yes, many Minnesotans’ fortunes have suffered in these difficult times, but Is government spending soaring beyond historical levels? Not really — measured as a fraction of state GDP, state and local government spending in Minnesota has been pretty stable in recent decades, and is now near a 20-year low. See, e.g., (thanks, Barry Cipra, for the web ref).

    June 14, 2011
  93. Paul Zorn said:


    Just to be clear … should the rich not pay more than the poor?

    June 14, 2011
  94. David Ludescher said:


    You made my point for me. Most of the budget talk is political spin based upon economic measurements that do not address the sustainability problems that the state has. The Strib editorial tells us that we should not believe the Republican spin. The Strib is right – the situation is more dire than the Republican spin.

    Last year, the state (under a Democratic legislature with approval of a Republican governor) “balanced” the budget using one-time revenue money and delaying payment of monies to schools. You cannot use last year as a measuring tool for this year’s budget without making compounding the problem.

    Whether the current legislative budget is a 6% increase is irrelevant. Whether the tax burden is comparable to GDP 20 year averages is irrelevant.

    June 15, 2011
  95. Ray Cox said:

    The whole ‘fair share’ issue is just smoke and mirrors. Minnesota has had a progressively higher income tax rate for decades. The ‘rich’ now pay around 8% I believe….sliding down to 5%, and the ‘poor’ often pay no income tax at all. What the liberals want to do is create a new statistic where they project what a ‘rich’ person pays in total taxes….income, sales, real estate, fuel, surcharges, etc. etc….and compare it to what a ‘poor’ person pays. In doing that they have come up with the idea that the percent taxes a ‘rich’ person pays is less than the percent a ‘poor’ person pays. As far as I’m concerned this is a bunch of hogwash. Almost all the taxes except income are discretionary tax levels. If you want to live in a huge fancy home you will pay more in real estae taxes. If you want to spend to purchase furs, diamonds, and jewelry you will pay more in sales taxes. If you smoke you will pay more in tobacco taxes. If you drink alcohol you will pay more in alcohol taxes. I have no idea how the “progressive think tanks” have determined the tax burdens that the ‘rich’ pay because I doubt they know exactly how they spend their money. Warren Buffet, one of our richest indivuals in America, still lives in the modest rambler house he purchsed in the 1960’s. Do we penalize people like that because they are not consuming enough and paying taxes? Or do we allow American’s to make choices on where they live, and what money they may save.

    It is also interesting to note that the ‘rich’ are the resource for venture capital and tremendous amounts of general capital investment in America. They also are huge donors to non-profits and charities. Apparently the liberal desire to ‘get the rich’ forgets that they ‘rich’ are doing a lot for our state and country in non-governmental areas. I would hate to see a new super-tax get imposed on the ‘rich’ and then see that they respond by eliminating all sorts of established giving, community support and capital contributions.

    We are not operating in the 1950’s….times have changed. I totally support a complete review of all Minnesota’s taxes in an effort to create a plan that is sustainable for the economy and times we are in now, and that will work at least 20-25 years into the future. School funding shifts do not work. Creating new super-tax levels will not work. It is time to do the hard work and create a new tax plan that will work.

    June 15, 2011
  96. Anthony Pierre said:

    ray, i’m curious how this trickle down economics worked the past 10 years.

    please cite specific examples.

    All i see is the middle class getting trickled on with piss.

    June 15, 2011
  97. john george said:

    Paul Z.- Are you talking morer dollars or a greater percentage? If a tax system is going to be equal, then everyone pays the same percentage of their income- say 10% of $30,000= $3,000 of 10% of $250,000= $25,000. Or, are you saying that the person who only makes $30,000 should not be required to pay $3,000 of that in taxes, but the person making making $250,000 should pay $28,000, to make up for the $3,000 the lower wager easrner is exempted from paying? I sounds more like the latter.

    June 15, 2011
  98. Jane Moline said:

    Ray: The percentage a wealthy person pays in taxes is a fact that is computed, not an “idea” (like intelligent design). The percentage less-wealthy person pays is also computable and a FACT, not an idea. Just because you don’t think these statistics matter does not make them irrelevant.

    In economics, disposable income is computed as a FACT in order to extrapolate different economic ideas–just like effective tax rates.

    Republicans are attempting to suspend all economic realty, including that taxing the rich some how affects jobs.

    The Minnesota tax rate was previously much more progresive and included a surcharge on top of taxes. Yes, the rich pay more because they have much more. The effective tax rate on the wealthy is lower than on the working poor, (which was formerly the middle class.)

    Republican “trickle-down” economics does not work and is more appropriately called “tinkle down” by those of us in the know.

    These policies have caused a HUGE shift in wealth to the wealthy–where over paid executives are sucking their corporations dry, kinda like vampires, and not reinvesting in the corporation for growth or employment or anything else.

    This unprecedented shift due to greed has caused the most economic hardship–not taxes, not unions, not teachers, not welfare-mothers, not illegal immigrants. Failed Republican policies of low taxes and lax regulations have led to a bridge failure, school failures, and the biggest economic disaster in decades.

    June 15, 2011
  99. Paul Zorn said:


    I’m not (for the moment) “saying” anything about taxation levels. I’m wondering what you think about how tax burdens should be shared. Feel free to refer either to absolute dollars or to percentages — either is readily converted to the other.

    June 15, 2011
  100. Paul Zorn said:


    John Kenneth Galbraith had lots of pithy things to say. Here are three examples, all from

    If you feed enough oats to the horse, some will pass through to feed the sparrows (referring to “trickle down” economics).

    The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.

    Any my favorite:

    Under capitalism, man exploits man. Under communism, it’s just the opposite.

    June 15, 2011
  101. David Henson said:

    The piece missing here is that most of the tax money does not “help the poor”, most of it helps bureaucrats have jobs. The great debate in the 50s was not if we should help the poor … both sides agreed. The Republicans wanted to give them money the Democrats wanted government jobs controlling their lives. What is bankrupting us now is not giving money to the poor … its the pensions on those government jobs … the poor don’t get pensions.

    June 15, 2011
  102. Kathie Galotti said:

    Great quotes, all.

    June 15, 2011
  103. john george said:

    Paul- Re. your favorite comment, it appears that Galbraith recognized that the foundational issue was neither political (liberal vs conservative) nor economic (socialist vs capitalist), but rather the general condition of the heart of man.

    Jane- You bring up a very important aspect of the discussion- disposable income. Of course, a wealthy person has more, but greed is not necessarily driven by how much a person has in the bank. A poor person’s jealousy of the rich can be driven by greed. I can think of a number of scriptures that are relevant to this discussion.

    June 16, 2011
  104. John G. The simple flat tax you used in your example is not considered a fair tax, almost no one with any background in decision analysis would claim it is fair. Unfortunately, fair has so many meanings that it is practically impossible for us to agree on what the best working definition is. For example, in a human-centric just world you could argue that we are all equal before the law and we should all pay the same amount, about ($6-$9K per person of any age each year). In the economic-man world of economists you might get a good argument that we should pay a percentage that is a function of income (so-called progressive tax) that is based on a log() function because that models the marginal economic good each person gets from their income. A similar argument can be made based on wealth (property tax). Of course, the political answer uses none of these definitions, instead relying on smoke and mirrors to permit taxation to primarily fall on the politically neutered middle class.

    June 16, 2011
  105. john george said:

    Bruce- I’m making a differentiation between “fair” and “equal”. Fair seems to have a subjective connotation. The flat tax is equal, in that everyone pas the same percentage of their income. The progressive tax is probably more fair, depending upon where you fall on the income scale. The great American quest is to make enough money to live on and cover our leisure endeavors, or so it seems to me. A person making six figures should have more descrationary income than a person making just a living wage. If you could figure living expenses at a constant, it would be simpler, but that is not possible. I saw an interesting letter in the St. Paul PP yesterday that compared the tax burden in terms of the whole population and just those gainfully employed. It makes a big difference whast you use as a benchmark.

    June 16, 2011
  106. William Siemers said:

    Jane…If the poor and ‘working poor’ pay little or no income tax and no sales tax on food or clothing, just what taxes are they paying? (rhetorical question). According to ‘fairness’ proponents, they pay sales tax on other items they buy, but nobody knows what they buy so this would seem to be difficult to quantify. Some pay real estate tax directly (relatively easy to compute); more pay real estate tax indirectly (not so easy to figure). They also are said to pay ‘passed along’ corporate taxes when they buy goods and services (really hard to figure). They pay taxes on gasoline if they drive and fees for license plates (hard to figure). And they pay taxes on booze, tobacco and entertainment if they drink smoke or go to the movies (hard to figure and questionable if they should even be considered).

    So while you say the ‘fairness’ computations are a FACT, I’d say they are based on assumptions. Also, the fairness argument does not include federal taxes and there is really no point in talking about tax fairness unless all taxes are considered.

    And the fairness assumptions do not include the state
    expenditures (other than the rent tax rebate) that are going to the poor and working poor. It seems to me that a discussion of tax fairness should include the percentage of tax payments returned to citizens in benefits. Maybe the rich, or somewhat rich, get more benefits from the state than the poor, I don’t know. But to not include benefits seems to miss the point in a ‘fairness’ discussion.

    Anyway, I agree with Ray. This discussion of state tax ‘fairness’, as currently presented, gets us nowhere in solving the budget problem.

    June 17, 2011
  107. Paul Zorn said:

    John G, Bruce, Ray,

    Concerning 33.2.2, 33.2.5, etc, concerning “fair” taxation …

    Discussion of taxes is often bedeviled by the fact that key words — fair, flat, progressive, regressive, equal … — are used in both neutrally descriptive and value-laden ways.

    Among these words, “fair” may be most problematic: almost nobody claims to want unfair taxation, so the live question is not whether “fairness” is a Good Thing but what fairness means for taxation and how to get more of it while also funding the stuff we need or want. No society is likely to come to full agreement on such difficult questions.

    One thing’s clear: no system of equal taxation (everyone pays the same dollar amount) is practically workable. At present all levels of government combined in the US appear to spend 35-40% of national GDP, or something like $20K per year per person. One might argue that such a percentage is too high (or too low), but no way could even half that amount be extracted from “average” families.

    Nor can any truly “flat” system (everyone pays the same percentage) either raise the necessary revenue or pass even the most rudimentary fairness smell test. Whatever “fairness” means, it certainly doesn’t permit taking a third or more from the proverbial widows and orphans.

    On the other hand, I’ve never heard of a hard-line flat tax plan advanced seriously, even by the likes of Steve Forbes or Jerry Brown, who used the flat-tax language in the past. Forbes, for instance, proposed federally taxing all incomes at around 17% — but only for the part above some base, perhaps around $35K in 2000 dollars. Thus Forbes’s “flat” tax proposal was in reality “progressive”, with effective income tax rates ranging from 0% for those earning below $35K to something near but less than 17%. (I doubt that Forbes’s plan could have raised enough revenue, but it doesn’t really matter, as his presidential aspirations went nowhere.)

    I’d prefer more, not less, progressivity in income taxation. Yes, at some point the impulse to tax the rich gets out of hand, discourages investment, yadda yadda. But I see no evidence that we’re near this point. All data I know of point to more, not less, concentration of wealth at the top in recent decades. If that changes, I’ll reconsider.

    June 17, 2011
  108. Patrick Enders said:

    The working poor pay (highly regressive) FICA/payroll taxes.

    June 17, 2011
  109. Paul Zorn said:

    William, Ray,

    A main point in 34.2.1, if I understand, is that the word “fairness” needs sharper definition in any debate over taxes.

    Fair (oops …) enough. But I’m guessing you’re both just as committed to fairness in the abstract as anyone else, so how would you define it? How, if at all, would you propose that state tax structure should aim for any version of fairness you think reasonable?

    Yes (as you both assert with many examples), it’s difficult to measure tax incidence with perfect accuracy. Measuring tax-supported benefits is probably even harder. The money value of a welfare payment is obvious enough, but what’s an Edina public education worth, or a law degree from the U of M?

    But most things are hard to measure perfectly in the real world, and yet we muddle along. Or, better, we work with approximations (like those generated annually in the Minnesota tax incidence study) and some sense of their likely accuracy.

    You may disagree with “current presentations” of fairness in solving the budget problem. But surely some notion of fairness comes into any discussion of who should share what pain. What do you propose?

    June 17, 2011
  110. William Siemers said:


    How about this for ‘fair’ for a federal plan:

    Exempt the first 35,000 for a family of 4.

    18% from 35k to 100k
    23% from 100k to one million
    28% over one million

    Eliminate all deductions and credits except dependents and state tax paid.

    Millionaires currently pay an average effective rate of 22%, so revenue from them will go up. (‘Fair’ for progressives). The 49% of citizens who currently pay no federal income tax will decrease. (‘Fair’ for conservatives).

    June 17, 2011
  111. john george said:

    Patrick- Re. your comment in 34.2.2, see my son’s experience in my post 33.2. Boy, would anyone want to make this return on their investment?! I’m sure he was not the only family in the whole US that had this kind of experience. In fact, I should probably change my opinion about the government not contributing anything to the GDP. From the example, it appears they do. Or, is it just wealth redistribution?

    June 17, 2011
  112. Patrick Enders said:

    You wrote:
    “The 49% of citizens who currently pay no federal income tax will decrease.”

    This is a highly misleading figure, which was only sort-of true in the collapse/stimulus year of 2009.

    Please see the following link for details, but note that even in that peculiar year:

    – 70% of those who “owed no income tax in 2009” DID pay payroll taxes.
    – 17% were senior citizens receiving Social Security
    – the remaining 13% (about 6% of the total adult population) consisted of not only the unemployed, but also included students, people with disabilities, and “others with very low taxable incomes”

    Also from the same article, note that on a national basis, local and state taxes (not to mention FICA) are highly regressive – which eliminates much of the limited progressivity of our national income tax system.

    June 17, 2011
  113. Patrick Enders said:

    I don’t know the peculiarities of your son’s situation, but national data (see my link at 34.2.5.) show that his is not a common one.

    June 17, 2011
  114. Paul Zorn said:


    Was your son’s experience some sort of clerical error or a peculiarity of tax policy? Sorry, I just don’t understand. Either way, what do we learn?

    June 17, 2011
  115. William Siemers said:

    Patrick…here is one of the many articles that quoted the 49% figure.

    I’ll agree that 49% seems to be somewhat misleading. But that link also includes a straight forward example of how a family of 4 pays no federal income tax on an income of $50,000. Under my example of a graduated flat tax, that family would pay $1650. My point remains that this would seem ‘fair’ to a conservative. Just as someone making a million paying $60,000 more, on average, would seem ‘fair’ to a progressive.

    Whether or not it meets your standard of fairness is another matter. Some might say…”why should that poor family have to pay $1650 more when that millionaire is only paying $60,000 more. I don’t agree, but I understand the objection. On the other hand, some conservatives might object to a reform that increases taxes paid regardless of the lowering of rates. I’m just looking for a politically palatable way of bringing reform, simplicity, and transparency to the tax code while at the same time increasing revenues. We can not solve the federal (or state) deficit problem without increasing revenues.

    June 17, 2011
  116. Anthony Pierre said:

    you know exxon paid no us taxes last year? GE either.

    June 17, 2011
  117. Barry Cipra said:


    “Graduated flat tax” — what a wonderful oxymoron!

    More seriously, could you explain how your example, as outlined in 32.2.4, leads to a family of 4 paying $1650 on $50,000? As I read it, that family pays nothing on the first $35k, and 18% on the next $15k, which comes to $2700. What have you left out?

    June 17, 2011
  118. john george said:

    Patrick & Paul- This was not a clerical error. The $11.00 return was for each $1.00 withheld. SS & Medicare would be above this. He thought it was a mistake at first, also, but when he contacted the IRS, they led him through the various programs for which he happened to qualify. My main point in this is to echo others’ comments here that the tax code needs to be revamped, or thrown out completely and a new system written from scratch.

    June 17, 2011
  119. William Siemers said:

    Sorry…I screwed up all the numbers. A family of four would pay 2700 and a family of 4 making 1 million would pay 225,000. And a family of 4 making 10 million would pay
    2,745,000. Not fair enough that a guy making 10 million pays 1000 times as much as a guy making 50,000? Or that a family making a million pays 83 times as much a family making a million? Adjust as you see fit. But lets make it simple and transparent by eliminating deductions and credits.

    June 17, 2011
  120. Ray Cox said:

    Jane, since you must have some direct line to tax computations, how about telling the readers how much I paid in sales and gas tax last year. You nor anyone else cannot do it. Sorry, no one but me has that information. No matter what you say or claim, the facts are the facts. I know it is hard when facts don’t back up what you want to claim, but that is the way it is.

    Patrick, low income people do often pay payroll witholding taxes. Unless I’m really mistaken, I’m not hearing a clamoring from folks to eliminate that provision. If low income people are paying payroll taxes they generally will also make use of SSI and Medicare. The funding and benefit system for these plans needs to stay in place as they are important parts of our care system.

    Paul, Steve Forbes did have a very interesting progressive flat-tax plan. I don’t think his effort was to raise additional revenue, but rather, to show to the public that we could in fact have a much eaiser to manage tax collection system. His plan did exempt the first threshold amount of income to protect low-wage earners and families. Our current tax system does the same thing, but in a much more complicated manner. Plus we employ boatloads of IRS agents and tax professional all across the nation to try and figure out a far too complex tax code.

    I personally think the most regressive tax Minnesota has is the sales tax, even though it supposedly does not apply to many essentials such as clothes and food. It is applied to just about any other material or product and falls rather heavily on low-wage earners. And the sales tax was just increased in the past couple of years. 6.875% (or more in the Metro area) is as high as the amount people have witheld for payroll taxes.

    June 18, 2011
  121. William Siemers said:

    Shoulda said 83 times as much as a family making 50k.

    June 18, 2011
  122. David Henson said:

    The USA in 50 years has traded the greatest middle class the world has even know (involved in manufacturing, bridge building, agriculture, R&D, etc) for the greatest governmental class the world has ever known (involved in manufacturing new rights, lotto tickets and economic theories). The governmental class has gown in parallel with a super rich class in a way that appears similar to communist regimes and dictatorships. The American people were happier in a time with less government, the American people were employed in a time with less government, the American people were more productive in a time with less government. I think almost everyone in their quiet moments knows the USA will sink with the government spending at wild levels and are waiting for a movement to truly pair it back by say 75% of current levels.

    June 18, 2011
  123. john george said:

    David- If we do pare back the government, then the umemployment rate will really skyrocket. You touched on an interesting aspect of the middle class. As we have sent more and more manufacturing processes off shore, that skilled labor segment of the middle class has shrunk. I’m not sure government has caused this so much as it has enabled it. Another aspect of our society that has affected the middle class is the increased use of technology in manufacturing. We now use machines to produce products formerly done by people. Now, one man can oversee 20 machines doing what 20 skilled laborers used to do. In some ways, our quest for greater and more accurate production has come back to bite us. All these things are on a national level, and in themselves, only affect our state financial situation the same as any other state. It is too bad we can’t find some oil reserve like North Dakota has found. There is nothing like having a supply of a commodity that is in high demand to boost the economy.

    June 18, 2011
  124. john george said:

    I forgot one example. Facebook is a multiple billion dollar company and it employs something like 1800 people. Do you suppose our technology has been as much of a cause of a concentration of wealth in a few people as any other trend in our country?

    June 18, 2011
  125. Paul Zorn said:


    Indeed, nobody knows exactly what anybody else paid in sales and gas tax. (If you know what you paid, you’re way ahead of me.)

    Still, I don’t get your point. Do you mean that, without perfect information about individuals, no useful policy discussion of such taxes is possible? Or just that estimates of tax incidence should be understood as … estimates? I’d go for the second alternative — with the proviso that “estimate” be understood not as “wild guess” but as mathematics- and data-driven approximation.

    Concerning Forbes’s “flat” (the scare quotes are necessary because none of these proposals is mathematically flat; they’re all piecewise linear, as is our current system) tax: Agreed, Steve wasn’t aiming to raise additional revenue, but to simplify the system (and to reduce taxes on the highest earners (and to get elected President (and now let’s start digging out of parentheses))). On the contrary, I think Forbes’s proposal was generally expected to reduce total revenue.

    You may be right, Ray, about the sales tax being regressive, even though omitting food and clothing probably mitigates this effect. If indeed the sales tax is regressive, I’d guess it’s because the poor spend a higher fraction of their incomes than do the rich. Research on such questions has doubtless been done — but necessarily with the sort of estimates you seem skeptical of.

    June 18, 2011
  126. David Henson said:

    John, I am not sure the change from a middle class to a government class is a cause and effect. I think you are correct that it is much faster to ship manufacturing functions off shore than governmental functions (although I would no longer be shocked to call Northfield City Hall and get someone in India on the phone to explain the local tree policy). But I do earnestly believe that voluntary trading in the economy is VASTLY more dynamic than a planned economy. The government is by definition not voluntary and so as it grows dynamism shrinks. Software technology is poorly understood by government and generally hard to control so it is not surprising that a lot of wealth and talent chases the opportunities.

    June 18, 2011
  127. Barry Cipra said:


    Thanks for the clarification. As a point of reference, if one feeds your family-of-four examples into the 1040 form for 2010, the initial tax obligation on line 44 there comes to $2766 for the $50k income family, $311,208 for the $1 million family, and $3,461,208 for the $10 million family. (Someone should doublecheck my arithmetic here; I’m no more immune to mistakes than anyone else.) Is it a coincidence that the results are so close for the $50k family?

    June 18, 2011
  128. Barry Cipra said:

    David, your assertion that “the American people were more productive in a time with less government” is wrong in two ways: We are far more productive now than we were then, and we did not really have less government back then.

    In 1961, according to a lovely graph published by the Washington Post (see — I hope the url comes through), there were 2.5 million civilian federal employees servicing a population of 187 million; in 2010, there were 2.7 million for a population of 310 million. The number itself peaked at around 3 million in 1990 under Bush Sr., and the number per 1000 population peaked in 1970 under Nixon.

    In 1961, the lowest tax bracket was 20% and the highest was 91%, vs. 10% and 35% today. The equivalent taxes for the families of 4 in William Siemer’s posting 34.2.4 (using an inflation factor of 7.5 to convert to 1961 dollars, doing their taxes with the 1961 form 1040 — you can find these online! — and converting the results back to 2011 dollars) were $5400 for the $50k family, $704,705 for the $1 million family, and $8,887,945 for the $10 million family.

    GDP in 1961 was approximately $530 billion. Converted to 2011 dollars (using the inflation factor of 7.5), that’s roughly $4 trillion, well under a third of 2010’s GDP of $14.5 trillion. Factoring out the 66% growth in population over the last 50 years still leaves more than a doubling in productivity.

    This notion that we’ve seen 50 years of unbridled government growth, that our economy was somehow more vibrant in a golden age of limited government, is nothing more than a myth, right up there with Roswell, Yeti, and the Loch Ness monster. We need a debate over what constitutes good governance, over what we want government to do and how we as a society are to go about paying for its operation, but we need a debate that’s grounded in reality.

    June 18, 2011
  129. David Henson said:

    Barry, what did you read in my post that made you think a bunch of government statistics (which are manipulated by oil imports, building millions of units of empty housing, etc.) would influence me? You are correct we need a spirited debate about governance – my thought is a whole lot less of it 🙂

    June 18, 2011
  130. William Siemers said:

    Barry…The ‘initial tax obligation’ is almost beside the point, whether now or in 1960. What matters to you, me and the government is what people actually pay. If the average person making over a million dollars pays an effective rate of 22% in federal income taxes, the effective rate for that group is not 35%. If the average family of 4 making $50,000 does not pay federal tax, their effective rate is 0 not 15%.
    Why keep a complex system that is full of loopholes, credits, deductions? It seems to me the first step in improving tax ‘fairness’, regardless of one’s politics, is simplification of the code.

    June 19, 2011
  131. David Ludescher said:


    You touch upon an interesting question about the nature of revenue generation through taxation.

    On the local level, revenue is raised by taxing real property wealth (land), but not personal property wealth (money). (If the land is used for business purposes, it is taxed at a much higher rate.) Revenue is also raised by charging a direct “flat” fee for product consumed – such as water, sewage, and storm water.

    I would guess that very few people think that the second system is unfair. None of us want to pay for someone else’s consumption. The first system is very unfair. It generates revenue without regard to ability to pay. Thus, small business owners downtown have to pay the same amount in taxes whether they generate income or not while wealthier non-profits businesses, residential property owners, and those with personal property wealth pay substantially less taxes or none at all.

    Taxes and fees from the government come in so many different forms that it is almost impossible to conduct a systematic analysis of tax burdens.

    June 19, 2011
  132. Ray Cox said:

    Paul, yes, estimates of what people pay in taxes are just that…estimates. And much of what they pay is controlled by what they decide to spend. Dayton seems to be wanting to create new tax policy based on complete estimates…or fabricated guesses as some people say. This is all based on the need for the ‘rich’ to pay their ‘fair share’. I’d say the ‘rich’ are doing an admirable job of paying the freight for Minnesota. Why go overboard and chase them away or encourage them to do other tax avoidance systems? David L is correct in that it is very, very difficult if not “almost impossible to conduct a systematic analysis of tax burdens.”

    It would be much more honest for Dayton to propose a surtax across the board on all income tax payers if he believes additional revenue is necessary. That has been done in the past to remedy what is hopefully a temporary shortfall of revenue. A surtax will have a sunset—typically 2 years, maybe 4 years—-and is applied as a new ‘bottom line’ on our standard tax forms. No need to create new forms, just add another line with a multiplier. The working poor that do not now pay income taxes do not get hit with the surtax so it is a reasonable, progressive tax plan. It allows all Minnesotans to help all Minnesotans. The ‘tax the rich’ is nothing more than a continuation of the class warfare that has been going on in St. Paul for several years.

    June 19, 2011
  133. William Siemers said:

    The Minnesota Budget Project forecasts that a 10% surcharge would generate 1.6 billion. If republicans would agree, and if Dayton can agree to the same amount in spending cuts, then the shutdown is averted…at least for a year.

    June 19, 2011
  134. Paul Zorn said:


    Continuing from 34.2.11, now so far aloft …

    As a math guy and a citizen I’m all over simplifying anything that’s unnecessarily complicated, and surely a lot can be done with our Byzantine tax code.

    But let’s take care not to conflate tax simplicity and tax fairness. Not clear this has been a problem here on LGN, but it’s done all the time “out there”, even IMO in grownup publications like the Economist. Nothing could be simpler than a truly flat tax (not that any’s been proposed) but almost nothing could be less fair.

    June 19, 2011
  135. Barry Cipra said:

    William, I did that calculation as a point of reference, to show what the current tax rates would produce if indeed we simply eliminated various loopholes, credits, and deductions. As I read your postings here, you have no fundamental objection to the concept of a progressive income tax, or as you so wonderfully call it, a graduated flat tax. Your main complaint is with the accretion of deductions and credits. So one might think of the number on line 44 as the “natural” tax obligation for a given graduated flat tax system, before it is distorted by the clamor of special interests. (I am, of course, glossing over a range of things that can distort even line 44, but in both our examples the families took only standard deductions and/or exemptions.) If you look at Form 1040 for 1961, you’ll see that it is almost exactly the kind of simple system you are proposing, just with a graduated flat tax that starts at 20% instead of 18% and goes up to 91% instead of 28%.

    You have, in effect, proposed a progressive income tax and called it fair, but without explaining what makes your choice of rates and thresholds fair. I could propose an alternative with a different choice of rates and thresholds and also call it fair. So could Paul Zorn. So could Patrick Enders. (I’m only mentioning people who have posted on this sub-subthread.) How do we decide who’s right?

    June 19, 2011
  136. Ray Cox said:

    Paul, I’m not sure I follow your thought on a surtax. If William is correct, a 10% temporary surtax, along with budget reductiions, will get us out of our budget problem. It is easy to implement and builds on our already progressive tax collection system. If you are in agreement that Minnesota needs more revenue I’m not sure why this isn’t being looked at.

    But, I will admit a surtax on existing taxes may not be the ideal solution to Minnesota’s budget problem. Minnesota gets knicked on a regular basis by the tax wonks who evaluate tax structures because we have such a progressive income tax system, and rely so heavily on it. Because of that, when the economy slides, like it has for the past 4 years, Minnesota is hit particularly hard in revenue collections. Incomes drop and income taxes drop. That, combined with pushing for ever large spending by the state creates a perfect storm that we are experiencing.

    I’d much prefer to see Dayton pushing for a surtax on income taxes than his push to create a new ‘super rich’ tax rate. We are all in this together and we all need to be part of the solution…not just a few of us.

    June 19, 2011
  137. Barry Cipra said:

    Paul, you are wrong on so many counts here it’s hard to decide where to get started. Let me just tackle things in order of their appearance.

    I’ll grant your status as a math guy, but could you please produce a birth certificate? We all know you grew up in India.

    The tax code is not byzantine. It’s rococo.

    It is quite clear that the conflation of simplicity and fairness has been a problem on LGN.

    It’s not true that “nothing could be simpler than a truly flat tax.” No tax at all would be simpler. Or is that what you meant by “nothing”?

    Nor is it true that “almost nothing could be less fair” than a truly flat tax, unless your weasel word “almost” expands to cover an infinite set of exceptions. A poll tax is less fair. A regressive system that taxes lower incomes at higher rates is less fair. Need I go on?

    I agree with you on just one point: We really should take care not to conflate the issues of simplicity and fairness. But I’ll go you one further: Just as we can’t expect general agreement on what’s “fair,” nor should we expect universal consensus on what’s “simple.”

    June 19, 2011
  138. Patrick Enders said:

    I think your surtax / meet half-way plan is a perfectly reasonable compromise. However, as I understand it, the Republican position is “No Tax Increases, Ever. Period.”

    Your plan violates this basic Republican principal.

    June 19, 2011
  139. Barry Cipra said:

    Ray, which posting of Paul’s are you replying to? I don’t see him offering any thoughts on a surtax at all, to be followed or not.

    June 19, 2011
  140. john george said:

    Patrick- What about the idea that we should plan the budget around projected revenues? According to one chart I saw, 46% of our state revenues come from personal income taxes. As someone pointed out, any decrease in incomes for any fairly large segment of the population will result in decreased revenues. The idea of proposing spending $2 billion more than what is estimeted (it is not a sure thing, by the way) to come in seems foolish to me. If we start with a $2 billion deficit, where will we be if there is yet another economic downturn? Will we be $4 billion, $5 billion in the hole then? The whole idea of borrowing against the future to pay for present enjoyment has been the philosophy that has gotten us into the mess we are in now. It reminds me of a line from a song out of my youth, “…You can get anything you want for a dollar down and a dollar a day…” The implication here is that it is a dollar a day forever. Who was it that said something about continuing to try something that does not work even though it continues to not work, or something like that?

    June 19, 2011
  141. Paul Zorn said:


    My bad for dissing the Byzantines … somehow they managed to hang on for over 1000 years, for much of this time as the world’s most powerful economy. The Rococos, on the other hand …

    Otherwise … please read more carefully.

    1. When I alluded to my “citizen” status, I did not specify any particular nationality. So much said, I have a “long form” document, issued by the State Department and signed by no less than Dean Rusk, testifying to my citizenship. Can you say as much?

    2. On a related matter … your youth in the shadowy Kansas/Missouri border region and your frequent visits to that area raise their own troubling questions.

    3. Conflation of fairness and simplicity has occurred on LGN, to be sure. Whether it’s a problem depends on whether anyone has been puzzled or confused as a result, and this remains unclear, just as I e-said.

    4. Re “nothing” and “almost nothing”: I meant, respectively, “zero tax” and “zero tax for all taxpayers except for a set of measure zero”. What else could these words mean? Yes, I know that for finitely many taxpayers these two concepts are identical. Can’t a guy joke around a little?

    June 19, 2011
  142. William Siemers said:

    We won’t get political agreement on what is ‘fair’. But we might get agreement on what is ‘simple’…particularly if it is revenue neutral. Once simplified, the code can be adjusted, to address fairness issues as political winds change. An overly complex, opaque system will never seem fair to the average guy, regardless what is done with rates, since virtually no one actually pays the rate.

    June 20, 2011
  143. Paul Zorn said:


    Sure, it’s a good idea to plan budgets keeping the expected level of tax revenue in mind. That’s why Gov Dayton is proposing a mechanism (not one that everyone likes, to be sure) to raise additional revenue to fund additional expenditure. Without revenue, expenditure can’t happen. Gov Dayton’s plan, however one may feel about it, is not to spend $2bn more than comes in through state taxation. (That’s what Gov Pawlenty did.)

    Deciding how much the state should spend (and hence how much new money, if any, needs to be raised, and from where) will always involve balancing the obvious advantages of low taxes with the equally real but sometimes less readily quantifiable benefits that public spending buys. What’s the money value, for instance, of helping our poor, ill, or aged fellow citizens live decently? What’s the ROI on K-12 education, or on the U of M? What do under-maintained schools or roads cost us all? That’s it’s hard to price these benefits and costs makes them no less real.

    Both parties could do better than they have in describing forthrightly, with specifics, the costs and benefits of the budgets they propose. Rhetorical posturing and pop psychology are ever with us, but we can hope for more.

    June 20, 2011
  144. john george said:

    Paul- I think there can be some confusion between tax rates and the percentage of taxes paid by a particular income level. According to the information I can find, the top 10% income level pays about 68% of all the taxes collected, and the top 25% of wage earners (by dollar amount of household income) pay about 85% of the taxes collected. Are you proposing that they pay 90%? 95%? Their percentage rate may be lower than those under them, but the dollar amount collected is far greater. If the state sees a decrease in the number of households making over a million dollars a year, this will have a greater effect on the amount of revenue available.

    I’m not saying the present system is just or fair or does not need repair. I just think we need to look at this situation from the two perspectives- $$ of revenue vs. % of taxable income. It is easy for me to sit back and say to the wealthy, so what if you have to pay an additional tax amount greater than my gross income? You should have enough to live on, anyway. Sorry, but this attitude smacks of greed (covetousness) on my part, IMO.

    June 21, 2011
  145. Paul Zorn said:


    Much of this discussion has focused on income tax, naturally enough given that Gov Dayton’s plan does the same. A good source for the bigger picture, however, is the biennial Minnesota Tax Incidence Study

    (Google “Minnesota tax incidence” if the link doesn’t work), prepared by Minnesota Revenue. The link points to a 160-page document, but there’s no need to read it all; the tables on pages 43 and 44 of the PDF are worth the visit. (Page numbers at the bottom of these pages say 30 and 31.)

    These and other data in the report show that while Minnesota income taxes are slightly progressive, total state taxes are very slightly progressive, and local taxes are are regressive enough to make total state/local taxes mildly regressive. (These conditions are sometimes measured using something called the Suits index; see page 27 in the PDF if you want more details.)

    The tax statistic that matters most to me is the bottom line: what I have to fork over to live here in Northfield, Minnesota. On that scale “the rich” are doing quite OK.

    Your readiness to admit to greed or covetousness does you credit, but I think you can rest easy on this score. “The rich” will be fine no matter what happens with Gov Dayton’s plan.

    June 21, 2011
  146. Barry Cipra said:

    William, I disagree. I don’t think we will ever avoid the Senor Wences effect: what’s easy for you is difficult for me and vice versa (see for the name of the effect). For example, I see nothing at all complicated in a graduated flat tax with a dozen or more gradations; in Paul Zorn’s terminology, it’s all one piecewise linear function.

    Please don’t get the misimpression that I’m opposed to simplicity or fairness. I am merely cautioning against the assumption that either is exempt from controversy. In addition, simplicity and fairness, while not the same, are deeply intertwined. Any change to simplify things will almost certainly run afoul of some special interest. Whether one views the inevitable protestations with favor or disdain depends in part on one’s political temperament. Where you say the code can be “adjusted” after it’s been simplified, I’d say that even if we did manage to simplify things, they’d just be made complicated again.

    Revenue neutrality is an interesting aspect. It might, as you suggest, serve as a selling point for a simplification plan, neutrality being the fig leaf behind which politicians can fiddle with taxes yet claim they haven’t voted to raise them. But in its briefing book on tax simplification, the Tax Policy Center has this to say: “[T]he landmark Tax Reform Act of 1986, although a remarkable accomplishment in many respects, fell short of its goal of simplicity in order to meet the requirement of revenue neutrality.”

    I would suggest that a better selling point for tax simplification is to emphasize the literal cost of the existing system. It’s been estimated that the cost of tax compliance — the time and money spent filling out 1040s and all the attendant folderol, not to mention the time and money that goes into finding ways of avoiding paying taxes or otherwise taking advantage of tax breaks — comes to something on the order of $200 billion per year, or the equivalent of 4 million workers whose fulltime job is tax preparation. Imagine what society could do if we could save even half that amount. Why, we could pay for another war!

    June 21, 2011
  147. Ray Cox said:

    But Paul…. will Minnesota be fine without the rich people? We have already been losing a fair number of wealthy retired folks to other states. If we ratchet up the tax rates will be chase even more of them away? And if we do, the revenue anticipated goes with them, leaving us with a spending plan but short on revenue.

    You may have seen an article in the news lately indicating the Obama administration is contemplating a ‘tax holiday’ for overseas incomee that corporations have. The plan as I understand it would be to reduce the tax on overseas earnings from the present 35% rate to a 5% rate. This would bring in huge amounts of capital back to America, and would also generate a fair amount of tax revenue.

    John is right that one has to ask how much the wealthy will be asked to pay to run a state. If they are indeed paying at the rates John cites, that is a significant amount. If additional revenue is needed I’d prefer to see a surtax put in place that allows all Minnesotan’s paying taxes the ability to help out all Minnesotans.

    June 21, 2011
  148. Barry Cipra said:

    Ray, you refer to an article indicating the Obama administration is contemplating a tax holiday for corporations. Could you be referring to in the Times? If so, here’s a pertinent paragraph:

    “The Obama administration has been uncharacteristically harsh in its criticism of the idea. President Obama and Treasury Secretary Timothy F. Geithner have said they will support it only if it is part of a corporate tax overhaul that results in no decline in federal revenues.”

    I don’t think “contemplate” is the right way to make a verb out of “contempt.”

    June 21, 2011
  149. Paul Zorn said:

    Ray, John,

    Do you have statistical data, Ray, that show that Minnesota is losing a disproportionate number of rich oldies, or that this has increased recently?

    I’m not sure whether the “rates John cites” are right or wrong — he doesn’t give any reference. The tax incidence study I mentioned suggests that the top 20% of earners pay about 72% of all state income taxes.

    Outrageous? Hardly.

    For one thing, these lucky 20% (which include me, by the way) get about 57% of the income, so even a mildly progressive income tax regime would be expected to give a result something like this.

    For another thing, the picture is different if one looks at total state and local taxes paid (yes, Ray, these numbers involve estimates). By this measure the richest 10% pays about 10.3%, as compared to the average of 11.5%. Hardest dinged by total taxes, peculiarly enough, is the sixth decile, right in the middle of the income scale.

    June 21, 2011
  150. john george said:

    Paul- Your percentages are more up-to-date than mine. I was refering to something I posted a couple years ago on this blog in a similar discussion. I just didn’t have time to research all the links I found today to come up with some firm figures.

    As far as 80% of the population paying only 38% of the taxes NOT being outrageous seems a little subjective to me. It is basically the difference in philosophies between financial liberals and financial conservatives. The underlying theme is whether the money a person earns at his profession is his own to disburse as he sees fit or if he is indebted to pay for the infrastructure that the other 80% of the population uses. His ROI seems disproportionately small, to me. We can throw percentages and their implications around all day, but that doesn’t net us any real dollars to run the state. What that amount should be is the big snag in St. Paul, right now.

    The other figure that throws off the amount paid per individual is the difference between the percentage of their GROSS income and their ADJUSTED gross income paid in taxes. Those with greater wealth can afford to have tax shelters which adjusts their income downward. The percentage rate of their particular tax bracket may not be a realistic reflection of their actual wealth.

    June 21, 2011
  151. William Siemers said:

    Paul…Baby boomers are retiring or about to retire. Many of these folks will have substantial incomes in retirement. Many of these will winter in states with no income tax, or states with much lower income tax rates. If one is away from MN for six months and one day each year, residency can be declared elsewhere, and the MN income tax can be avoided entirely. I think it is safe to assume that the proportion of Minnesotans doing just that will increase in the future.

    It can be argued that boomers would make this move regardless of any increase in rates. Or that Dayton’s plan to initiate a snowbird assessment will mitigate the effect. But, in any case, more of these high income, high net worth people will be leaving MN for at least half a year, every year. That will contribute to a reduction in income tax collections from them, whether in part or in full, and a reduction in other tax collections as well.

    While I support a one time surcharge to address the current crisis, I think in the long run it might be in Minnesota’s best interest to reduce income tax rates. Texas, with no income tax, leads the nation in job creation. (40% of all new jobs since the ‘recovery began’). There are probably a lot of reasons for that, but I think it is safe to say that the lack of a personal income tax is one of them. Of course a progressive from Minnesota might say that our quality of life is so much better than that of Texas. Maybe they’d be right, but a Texan would probably take issue.

    June 22, 2011
  152. Michelle Hawkins said:

    While you’re all sittin here armchair qusrterbackin, the state shutdown looms ever closer. A shutdown that has already resulted in my receipt of notice of being furloughed without pay from a paid volunteer position at a nursing home, because the administration of these fed/state funds that are already allocated and locked to the payroll, will be considered nonessential.

    I’ve spoken with many affected in even more dire manner, including those, along with myself, that have already received notice that the administration of food stamp funds qualified for will be nonessential and such may not be accesable until the state is operating again.

    Add in that certain funds to nursing homes(not necessarily medicaid) will also stop during this resulting in some patients having to be sent either to the hospital or home with families ill equipped for their care.

    I don’t care which side of the budget issue any of you fall on, instead of writing your treatese here, please write your representarive and tell them to settle this, or at least administrate those monies that are already allocated, and care for those who would lose everything due to this shutdown.

    Please. Nobody’s mother should be treated like this after paying taxes all their lives.

    June 22, 2011
  153. Barry Cipra said:

    Michelle, you plead with us to writer our representatives instead of writing treatises. Why can’t we do both?

    June 22, 2011
  154. We Can do both and we must : When in newpaper article last weekend that Nursing Home workers are non-essential Thanks to the Republican leadership who claim to care about the elderly this will be a true test to see if they can COMPRIMISE : everyone will have a spin but who do we trust : Maybe we can pray to Jesus after all Jesus has all the answers ? Thanks

    June 22, 2011
  155. Paul Zorn said:


    Re this:

    As far as 80% of the population paying only 38% of the taxes NOT being outrageous seems a little subjective to me. It is basically the difference in philosophies between financial liberals and financial conservatives. … [A rich person’s] ROI seems disproportionately small…

    Three comments:

    (i) According to my figures 80% of the population pays only 28%, not 38%, of the income taxes in Minnesota. But income taxes are only part of the big tax picture. In this larger sense, the incidence study suggests that the top 20% pays a smaller fraction of income in total taxes than do their poorer fellow citizens.

    (ii) Deciding who pays what fraction to run a decent society has always been and will always be “subjective”, as you put it. So are questions of what we want from a decent society, and government’s role in providing these things. These questions will always be “live”, and that’s probably a good thing.

    (iii) The concept of return on investment (ROI) nicely illustrates the essential subjectivity of these discussions. As an above-average earner I pay above-average taxes, and so from one ROI perspective should resent paying “more than my share” for schools, parks, roads, etc. I don’t resent it — not because of any special virtue but because I think I individually and we as Minnesotans get well-above-average Return, some tangible and some intangible, On our above-average Investment in our above-average state.

    June 22, 2011
  156. Barry Cipra said:

    William, your reference to Texas not having an income tax got me to wondering how they do go about picking the pockets of the public in the Lone Star State, so I poked around a bit and found this from their “Window on State Government” — –website:

    “The Texas Comptroller’s office serves the state by collecting more than 60 separate taxes, fees and assessments, including local sales taxes collected on behalf of more than 1,400 cities, counties and other local governments around the state. State taxes and fees will generate an estimated $77.5 billion in the state’s 2008-09 budget period.”

    Among the 60 separate items is the Sexually Oriented Business (SOB?) Fee:

    “A fee is imposed on sexually oriented businesses that provide live nude entertainment or live nude performances and authorize on-premises consumption of alcoholic beverages, regardless of whether the business is required to hold a license or permit under the Alcoholic Beverages Code.”

    The fee itself is “$5 for each entry by each customer admitted to the business.”

    Setting aside exactly what they mean here by “entry,” can we agree this is a job-killing tax?

    In all seriousness, the mention of Texas supports the point Paul Zorn has been making all along, that income tax is only one component of the total tax burden, so the discussion of who is paying how much of their “fair” share should not focus myopically on that one aspect.

    June 22, 2011
  157. Michelle Hawkins said:

    Barry- Indeed I hope that’s what is happening~! I pray that most, if not all, good people would plead with our representatives to let go of the political posturing, to let the party line wiggle a bit, at least for now, or build a funding bridge to those of us who will be homeless in less than a month, have children to feed, amother in a nursing home, a senior on food stamps working less than 20hr week for minimum wages in the Older Worker program which will not be paid because administering the locked funds already allocated isn’t essential!

    Isn’t essential to who? The senior who won’t eat,and can’t pay the rent?

    This whole thing is posturing for party line on both sides and the low income, vulnerable, aged, and disabled are the pawns.


    June 22, 2011
  158. David Ludescher said:


    Those numbers are deceiving because the Minnesota tax burden is based upon wealth, income, and consumption.

    Local taxes are primarily based upon wealth – specifically real estate wealth. Personal property wealth is excluded as is the real estate wealth of non-profits, like the colleges. Thus, a fair comparison for local taxes would compare wealth with local taxes. That comparison would show that large non-profit landowners (i.e. colleges) and those with large 401(k)’s are not paying their “fair” share. Business owners (like me) pay property taxes on our businesses and our homes. (And, the businesses are at a much higher rate than residences.)

    Sales taxes (at least in Minnesota) don’t tax essentials, like food, shelter, and clothing. A poor person without disposable income can avoid most sales taxes. A better comparison for this tax is to compare sales taxes paid with consumption amounts – not income.

    Of course, there are many other fees and taxes, some voluntary and some involuntary. So, “tax burden” is a somewhat arbitrary concept, especially if one only considers it as a percentage of total yearly income.

    One could certainly argue that all taxes should be income-based or wealth-based or consumption-based. But, the real issue facing the legislature and the governor right now is, “What should we do about the $3.4 billion gap between our budgets?”. Dayton’s solution is to focus upon one tax – the income tax – and then for a very small percentage of the people – the rich. There is nothing “fair” about requiring a small segment of the population to pay a bill that belongs to everyone.

    June 22, 2011
  159. Michelle Hawkins said:

    I’m glad you said a poor person can avoid MOST sales taxes. I’m low-income(not poor as my spirit is rich!). I have to own a car to get to work. I paid taxes on it’s purchase and on the gas I put in it. I pay taxes and fees on the utilities (phone etc). Do you think the low income don’t eat a candy bar once in awhile(or don’t deserve to)? Taxes. I pay rent, and per my landlords say so, part of that goes to what? Property taxes.

    I buy toilet paper, and other things that are not food, like stuff to clean my house, shampoo, etcetc, =taxes.

    The “poor” still have to have these things, and pay the associated sales taxes on them, just like you do.
    You try living without toilet paper for a week, how many bath towels and washclothes are you willing to foul doing it? oh, and the laundry soap needed to wash those now foul towels…sales tax.

    Your theory is not flawed, it’s downright incorrect. The low income just do without more than others do, or are willing to.

    June 22, 2011
  160. Michelle Hawkins said:

    oh, I know, the “poor” aren’t buying 3carat diamond rings and large motorboats, thus don’t pay as MUCH in sales tax.
    If you can afford those things, you can afford to give back to the state that made it possible for you.

    June 22, 2011
  161. David Henson said:

    “Fairness” could only be meaningful if the dollars paid into the state were utilized more effectively ‘to provide the greatest benefit to the greatest number’ than if those dollars remained in private hands. Personally I am not at all convinced the dollars are use more effectively. I was in New Orleans after Katrina and was told the churches sending people in to rebuild were far more effective than the government. I think everyone would agree that a rate of taxation exists where the utility of those tax dollars plummets. I think we are way past the point of efficient use even if one believes in the concept of forced taxation. I am particularly concerned as a hungry entrepreneur that Mark Dayton as someone born with money, but having never actually made any money, may be confused between rain making activity (product development, agriculture, shipping, etc) and consumption activities (those that would not exist or be valued much lower were they required to trade in a free and voluntary system).

    BTW: I am in Texas and the mood does seem more up beat business wise than other parts of the country

    June 22, 2011
  162. john george said:

    Pauk Z.- Thanks for catching my typo, “38%” vs “28%”. Believe it or not, I can actually add and subtract correctly, but I can’t type worth a hoot!

    I agree with your spending motivations. I try to live far enough below my means so that I have something left to give. It is a Biblical pronciple.

    June 22, 2011
  163. David Ludescher said:


    My point was that using percentage of income as a measure of fairness in taxation (as seems to be Paul Z.’s point) gives misleading information.

    For example, cigarette and alcohol taxes are very “regressive” when measured against a person’s ability to pay. But, when measured against a person’s ability to avoid the tax, they are perhaps the most fair taxes that we have.

    On the other hand, our colleges own substantial lands and have hundreds of millions of dollars in the bank. But, do we want to start taxing their lands, and their services just because they are “rich”?

    June 23, 2011
  164. Michelle Hawkins said:

    David- I reread your post and it does pose quite a query!
    The colleges bring a huge amount of revenue in other ways to Northfield though, so when trying to frame it in my mind, I wonder if taxes would be an addition to this revenue, mean a subtraction from the funds already given by the colleges themselves to Northfield?
    Obviously the students would still be spending here.

    I’m still thinkin on this one… 😉

    June 23, 2011
  165. Ray Cox said:

    David Roberts….the Governor has declared that the people that take care of fragile people, like Michelle, are not essential. He has also declared that the people that feed the Minnesota buffalo herd are essential employees, among other things. Is this perhaps more related to what workers are union affiliated and what workers are not affiliated with a union?

    June 23, 2011
  166. john george said:

    Ray- You reiterate an accurate point. I have heard a number of people complain about how the Republicans wanted to take the pay away from the nursing home workers. This is about as false as it comes. It was Governor Dayton who proposed the interim budget with no funds for nursing care. The buffalo could be turned out to graze in a pasture. They lived hundreds of years like that. It is a ;ittle more dificult to turn a mobility impared senior citizen out to graze. They have never lived like that. And supposedly the Republicans are NOT compassionate? Nothing against unions, but I would be just as suspect of the union influence as you are.

    June 23, 2011
  167. Michelle Hawkins said:

    Ray- actually I am in the Older Worker Program, which pays me out of fed?state funds. The care center gets me as a volunteer, at no cost while I am paid from program funds. The money has been allocated,and secured to ther program thru June 2012.
    The person that disburses the funds, however, has been deemed nonessential, putting 1000’s of senior’s in this program on furlough. Seniors who have little else to live on, that cared enough to operate at low income, in non-profits, in a service to others.

    I was told today that unemployment checks are under the same gun, and it’s very much in the air if those checks will be issued.

    What the hell does the state own a buffalo herd for when this is going on?

    June 23, 2011
  168. Michelle Hawkins said:

    Better idea, state should slaughter entire buffalo herd, dispense meat to those most in need that are layed off as a result of the legislature/gov’ner incapacity to do their job!

    June 23, 2011
  169. Michelle Hawkins said:

    Hit the send too soon! Meant to say, I haven’t had a steak in 4yrs as a result of mY budget, buffalo will do just fine.

    June 23, 2011
  170. john george said:

    Michelle- Perhaps it is just to buffalo the citizens into doing what the politicians want. 😉

    June 23, 2011
  171. Paul Zorn said:


    Percentage of income paid in taxes is doubtless an imperfect barometer of tax fairness — I doubt any single statistic could fully capture all the nuances of a complicated matter. But it’s hard for me to imagine that statistic not coming prominently into any discussion of the matter. Can you think of a better gauge? Would it help to separate “avoidable” and “non-avoidable” taxes? I’m dubious …

    Whether colleges and other tax-exempt institutions should retain that status is an interesting question in its own right. But what does this have to do with whether colleges are rich or poor? I don’t follow.

    June 23, 2011
  172. john george said:

    Phil- Actually, no, I was not refering to that link. The various articles about the Governor’s interim budget have been what I read in the Strib. I thought that part of the brouhaha in going to court was the disagreement between the legislature (which claims to have the only authority to appropriate funds) and the Governor’s office (which is appropriating money for essential services if the shut-down materialized). Seems like a lot of silliness to me. It is little wonder that I hear so many people saying they are fed up with the politics we presently have.

    June 23, 2011
  173. Michelle Hawkins said:

    John- I couldn’t agree with you more!

    June 24, 2011
  174. David Ludescher said:


    The first place to start with tax fairness is to analyze the government expenditures and whether it is fair to tax anyone for that expenditure.

    For example, should the citizenry be taxed for a Vikings’ stadium? If so, which ones? Who should be taxed for the light rail system which cannot support itself?

    It seems to me that the best barometer for fairness is the same system that the marketplace uses – are you paying for the goods or services that you are using? How is it unfair that Target charges the poor and the rich the same price?

    Regarding the colleges, they are indeed “rich” by any definition of the term. And, yet the taxes that they pay are disproportionally small to their ability to pay. This is clearly an exception to the “rich should pay more” standard being advocated by the governor. If the sole rationale for requiring the rich to pay more is that they can afford it, then the colleges would fall into this category.

    June 24, 2011
  175. Paul Zorn said:


    In ref to 46.2.3:

    Whether a particular tax expenditure (e.g., for stadia) is wise or foolish is always fair to question. But I think it’s unhelpful to conflate such questions with issues of tax fairness — which arise regardless of how wisely public money will be spent. In the real world, IMO, contentious issues have to addressed in parallel, not in series. Either we muddle along or we get nowhere, ever.

    One of these contentious, never fully resolvable, issues concerns user fees vs more general taxation. The matter seems to me more complex than your Target pricing analogy suggests. It may be easy, for instance,

    June 25, 2011
  176. Paul Zorn said:

    Oops, 46.2.4 got away from me … let’s try again.


    In ref to 46.2.3:

    Whether a particular tax expenditure (e.g., for stadia) is wise or foolish is always fair to question. But I think it’s unhelpful to conflate such questions with issues of tax fairness — which arise regardless of how wisely public money will be spent. In the real world, IMO, contentious issues have to addressed in parallel, not in series. Either we muddle along or we get nowhere, ever.

    One of these contentious, never fully resolvable, issues concerns user fees vs more general taxation. The matter seems to me more complex than your Target pricing analogy suggests. It may be easy, for instance, to price a fishing license or a campsite fee, but how should we “price” good schools, or keeping Grandma out of the snow? In the real world (continuing in that sententious vein) the user fee/general tax models will always be in tension.

    Whether colleges, churches, and other institutions should be or stay tax-exempt is yet another interesting-but-peripheral-to-tax-fairness issue. Were they taxed at all, I’d say they should be taxed “progressively” (Carleton would pay more than St Olaf, for instance … ). Meantime, let’s try to improve tax fairness among taxpayers.

    June 25, 2011
  177. David Ludescher said:

    Paul 46.2.5,

    In my mind, “expenditure policy” comes before tax policy. If the budget impasse does not get resolved before July 1, that is what the courts will be asked to decide. Essentially, the courts will be asked to decide which services are core (essential) services and which are non-core services.

    As far as I am aware, neither the governor nor the legislature has a laid out a plan to differentiate core/non-core services. Thus, expenditures for the Mills Towns Trails are considered just as important as is health insurance for the unemployed.

    This budget debate is not about a “fair” tax policy. It is not as if we suddenly discovered that the rich aren’t being taxed enough. The whole debate is centered upon whether we should raise additional revenue by taxing the (income) rich. The Republican approach seems more sensible – balance the budget with what you have now. Then we can see what isn’t funded and determine how to raise that revenue.

    The Democratic plan – let’s see how much revenue we can raise, and then decide where to spend it, is bad policy.

    June 25, 2011
  178. Paul Zorn said:
    June 26, 2011
  179. Paul Zorn said:
    June 26, 2011
  180. Oh Michele Bachmann : Says one thing and does the other : Bachmann blasts the Medicare and welfare and payments to the elderly yet her husband got 137,000 dollars in Medicaid payments Bachmann and associates with this kind of spending how does that reflect her true conservative values if she has any : Once again history changes in Iowa : I learned something new about John Wayne :

    June 29, 2011
  181. David Henson said:

    David, If you vote against repaving Division Street does that mean you cannot drive on it? Being against something governmental that benefits you personally adds to credibility rather than detracting as you suggest.

    June 29, 2011
  182. Paul Zorn said:

    David H,

    Not as simple, methinks, as you suggest.

    Whether a good buy or not, better pavement on Division is a common good, not an individual benefit. Since we all pay, grudgingly or not, we can all enjoy the result in good conscience.

    I know nothing about the Bachmann case. And one who opposes supposedly excessive government payments to individuals, while also receiving them, probably breaks no law. But he gets no extra credit in my gradebook. I’d award more cred to the welfare opposer who refuses benefits he’s eligible for.

    June 29, 2011
  183. What does paving the street have to do with Bachmann?

    June 29, 2011
  184. john george said:

    David R- You, of all people, should understand how medicare payments align with true costs of providing services. Most doctors limit the number of medicare patients they treat. Someone has to pay the rent and electricity, and medicare reimbursements do not keep up with those expenses. Have you checked recently how many dentists in Northfield treat medicare clients? For Bachmann’s husband to treat this many patients seems admireable, seeing as how he loses money on the services.

    June 29, 2011
  185. Michelle Hawkins said:

    David(s)- Being against medicare/medicaid and taking payments at the same time kinda reminds me of a hooker campaigning for stronger prosecution of prostitution.

    Just an observation.

    June 29, 2011
  186. David Henson said:

    Paul Z, considering you have indicated a personal tax bracket which should be taxed higher then extending your logic, can we assume that you send in an extra gift to the government each year equal to what you feel is morally correct for all Americans to pay? Is Obama leading the way in gifting extra personal funds to the government?

    June 30, 2011
  187. David Beimers said:

    To be clear, Michele Bachmann’s husband received Medicaid reimbursement, not Medicare. Medicaid is for low income, indigent, and disabled children and families. Medicare is primarily for the elderly. I personally don’t have an issue with her husband accepting Medicaid. In fact, a lot of Medicaid here in MN is contracted through HMOs, so the provider may not be fully aware as to who is providing the reimbursement.

    The larger point is that while low-income adults and families currently have some medical coverage through public assistance programs, changes proposed at both the state and federal levels would greatly limit eligibility. At that point, some of Mr. Bachmann’s clients won’t receive any mental health services.

    June 30, 2011
  188. We also fail to mention the 260,000 dollars in Farm subsidies > Yes I know how Medicare works :

    June 30, 2011
  189. john george said:

    Well, David R., if you want to fault the Bachmanns for taking Medicaid money for services rendered to Medicaid patients and farm subsidies on eligible farmland, I guess you can. That is your opinion, and you have freedom to express it. I fail to see how either of these actions has any bearing on the Minnesota Stae budget woes or the ideologic logjam going on in St. Paul right now.

    June 30, 2011
  190. my way of thinking here is Bachmann opposes any form of medicare medicaid and any form of government aid to others but it is ok for her to take it : It works both ways state and federal : Thanks to no comprise by the Republican Party (They ought to be ashamed) : They talk a strong about Economy and Jobs well with a shutdown Minnesota stands to lose Millions and it will cost more now to rebound : Thanks for the shutdown

    July 1, 2011
  191. kiffi summa said:

    there’s a word for Michele Bachmann’s actions regarding the Social Service programs and farm subsidies she deplores publicly , but accepts personally : hypocrite.

    July 1, 2011
  192. john george said:

    Back to the question of the gridlock, I have been looking for some details about what programs on which Governor Dayton was proposing to spend the additional $2 billion plus. I know there was not any great increases that would affect my wife’s industry, seeing that most wokers there have had to endure pay cuts over the last few years just to be able to pay for the needed services. Does anyone have a link delineating the specifics of the increase?

    July 2, 2011
  193. There was little or no new proposals from either side Nursing Homes and Nursing Home workers are not a priority to some: I Hope some people think to change their minds Minnesota’s population is aging fast : Long-Term Care Funding has been on the slide for over 12 or more years at best : Long-Term Care gets what left of the scraps under the table until we can find a fair and equal way to re-imburse Long-Term Care : Both parties have let us down : We should no longer push our elderly to the side but make them a priority :

    July 2, 2011
  194. David Beimers said:

    John – most areas of the budget are being cut, although there are differences in the extent of the cuts (e.g., Governor cuts MNSCU by 6%; legislature cuts MNSCU by 14%). However, the main difference is in the Health and Human Services budget. That’s where the difference is over a billion dollars between the governor and the legislature. One example is restricting eligibility for health care programs. Many low-income adults will lose their eligibility for Medical Assistance (MN’s version of Medicaid) and for MN Care. We will save money by providing health insurance to fewer people. The challenge here is that the projected costs of health care continue to rise, so it’s much more difficult to just say we won’t spend any more money than we did in the previous biennium. There are many smaller cuts to Health and Human Services as well (child care assistance support, long-term care assistance, elderly waivers that keep folks in their residence, etc.). It really comes down to a question of what we see as our role as a state in providing a safety-net for those with disabilities and those who are poor.

    July 2, 2011
  195. David B : It is time that other areas of Government feel the sacrifice not just Nursing Homes or people who are disabled : Maybe the DNR and their reckless spending ever thought of that : They get five times at monies : Long-Term Care only one or half

    July 2, 2011
  196. john george said:

    David B- The most recent chart I could find shows HHS as receiving about 46% of the budget, followed by Education with 30-some%. I suppose that when roughly 80% of a $34 billion budget goes to just two catagories, then cutting things out of the other 20% just doesn’t produce that much affect on the total. This is an unfortunate situation. Seeing that the 2012/2013 budget is $2 billion higher than the last bienium, are these “cuts” just differences in the amount of increases given, or are the 6%/14% “cuts” actually that nuch less than the 2010/2011 budgeted amounts? This should not be just semantics we are talking about here.

    July 2, 2011
  197. David Beimers said:

    John – For MNSCU (which I am most familiar with, since that’s my employer), the reductions were from a base that didn’t change from Fy10-Fy11. So, they are indeed real cuts. The state’s contribution to the cost of higher education in the MNSCU system has dropped over the past decade from around two-thirds to about 45%. Fortunately (though certainly not for the students), schools can make up some of that difference through tuition hikes.

    The Health and Human Services budget is different. That base continues to rise based on projections of rising health care costs, increased eligibility for programs, etc. Take the MN Sex Offender Program as an example. The number committed to that program has grown from 167 in 2000 to 575 in 2010. There has been (and will continue to be) growth in the long-term care needs of the elderly, as well. So, the projected budgets in HHS incorporate this project growth.

    July 3, 2011
  198. To David B : The Budget and spending does not reflect the shortfall Long-Term Care continues to fall behind lack of funding properly as costs go up : Yes I feel that we should reform and make cuts in our sex-offender treatment program alot of waste there as reported in the last auditors report quite a read :

    July 3, 2011
  199. Paul Zorn said:


    You ask in #54 how Gov Dayton proposes to spend the “additional” $2bn. I assume you mean the difference between the Republicans’ proposed $34bn and Dayton’s $36bn. That’s a reasonable question, given the numerical flotsam and jetsam left by our foundering ship of state.

    My answer: there is no $2bn of “new money”, so

    Speaking of numbers, the Republicans have also mentioned $32bn, above which their $34bn budget proposal is supposedly a 6.6% increase. And Gov Dayton’s budget (or some earlier version of it) is often described as a 15% spending increase — by Katherine Kersten in today’s Strib, for instance.

    The difficulty of reconciling these numbers is not mathematical as such (I went on about this further in 26.1.1). The difference between 34 and 32 is indeed 2. And 34 really is (pretty close to) a 6.6% increase over 32. The problem is with reliability and meaningfulness of the “input” figures themselves.

    The baseline number $32bn seems to me most problematic — and most crucial to the Republican argument that $34n represents a real 6.6% increase. As I said in 26.1.1, the state seems to have spent something like $34.5bn in the present biennium, when federal stiumulus payments are included (as they should be if we’re comparing monies available for spending in one biennium as opposed to the last. Adding in the (disgraceful!) “shift” (aka, IOU) of $1.9bn in school support, plus some natural and inevitable increase in the cost of operation (14K new students in our schools, for one) it seems clear to me that there’s no mysterious new $2n to be accounted for.

    July 3, 2011
  200. john george said:

    Paul Z.- I’m a little suspiscious of the numbers here. If projected revenues are $34 billion, and the governor is proposing a budget of $36 billion, then there has to be an additional $2 billion found somewhere. It isn’t just hiding in the wings. I’m a little skittish of borrowing against future monies that are probably estimates, at best. I really don’t have a problem with 7000+ millionaires paying more in taxes (if, indeed, there would actually be an increase in the taxes they actually pay). I just don’t trust the system to actually produce this increased revenue. It seems (only anecdotally) that in the past, the tax burden somehow settles on the middle class, not the upper income levels. I don’t have exact figures on the 7000+ millionaires, but are we talking about people who actually have this much income or are they just worth that on paper? In as much as these people seem to have leverage with the legislature, it seems there will be ways found to circumvent the tax liabilities. My concern is that after 2 more years, we will have an even larger government to fund and we will still be in the hole. This goes back to our differing political philosophy bases. You see government as an answer to financial difficulties. I see government as a drain on the financial health of the state. Reality is probably somewhere in between these poles, with one balancing the other.

    July 3, 2011
  201. Paul Zorn said:


    Perhaps I misunderstood your question.

    If your point is simply that a 36bn budget must include 2bn more in spending than a 34bn budget, then of course that’s true — and I, too, would like clearer numerical information than I’ve seen so far.

    I’d like to see, for instance, a 3-column, apples-to-apples chart comparing expenditures in various categories: Column 1 showing actual spending (from all pockets) for the 2010-11 biennium; Column 2 showing budgeted spending under the Republican plan; Column 3 showing budgeted spending under the Gov’s plan. (Surely such a simple chart exists, but I haven’t seen one.) A few other data would help us all make sense of the numbers: how much spending in 2010-11 derived from federal stimulus funds; a clear accounting for the $1.9bn school funding shift; information about various effects of “inflation” of various kinds — increased population, changes in school populations, cost inflation in health care and other expenses the state incurs; etc.

    With such information we could better evaluate conflicting claims. The Republican 6.6%-increase-in-spending mantra, for instance, seems to me at best a sophistry and at worst a tiresome fiction. But I’d change my mind if convincing numerical data were presented to the contrary.

    As you say, too, raising 36bn means raising 2bn more than raising 34bn, and raising either amount inevitably depends on the “estimates” you’re “skittish” about. But the future is always uncertain, and every budget involves estimates.

    Bottom line: I’d like more details, too, but I’d estimate (sorry) quite confidently that Gov Dayton’s 36bn total figure, however it’s arrived at, represents little or no real increase in spending from the present biennium.

    July 3, 2011
  202. john george said:

    Paul Z.- Yep, that is what I meant. Sorry I was not clear with my question. I agree that it would be nice to have your spread sheet. Perhaps neither side wants that because it puts their rhetoric into perspective. It just doesn’t seem like the process should be that difficult, and I believe the difficulty comes in both sides just wanting to support their rhetoric rather than actually working out a solution. Dayton made a promise to the voters to raise the taxes on the super rich, and by whatever means possible, he is going to keep that promise. The Republicans made a promise to reduce the size of the governemtnt, and they are determined to do it no matter who gets left in the dust. I really question if the framers of the constitution had this much complexity in mind when they gave us the framework for our government.

    As far as Dayton’s proposed budget being the same as the current bienium, I don’t know how you come to that conclusion. We have not seen 6% inflation in a long time. It is really discouraging to me if $2bn more in spending will not get us more services than what we have. That has got to indicate waste somewhere in the system. I also think it doesn’t matter if it is $2bn or $10bn more. If we don’t have the money, we don’t have the money.

    July 3, 2011
  203. Phil Poyner said:

    “As far as Dayton’s proposed budget being the same as the current bienium, I don’t know how you come to that conclusion. We have not seen 6% inflation in a long time.”

    John, not all sectors of the economy suffer inflation in the same way. When I looked at the CPI for the 12 months preceding Sep 2010 and Sep 2009, I see that overall inflation was near zero. But medical care services inflation was 3.3% and 3.7% for those same periods. In a biennium the total inflation would have been 7.1% (I’m sure Paul will point out if my math is wrong). So, if medical services costs incurred by the state are actually a big part of the budget, inflation in that sector alone will have a larger impact to the overall budget than one would at first assume inflation could. In the end a 6.6% increase in cost for the same level of services may end up being explainable.

    July 3, 2011
  204. Paul Zorn said:


    Phil’s right — both about the fact of differing inflation in different areas and in his calculation. (Keep in mind that n% inflation annually creates a little more than 2*n% biennially.) So a 7.1% biennial inflation rate in medical services — over which the state has no control — will indeed take pretty big chunk out of what might seem to be $2bn in new spending. Inflation in other areas the state purchases may also outrun general inflation.

    Other forms of “inflation” (note the quotes, here and in 54.3.2) also play a role. I read somewhere, for instance, that we can expect 14K more school kids in Minnesota in the coming biennium. If that’s true, these young citizens represent new expenses our state will somehow have to defray.

    I’m sorry if you’re “discouraged” that $2bn in new money won’t necessarily buy us new services, but that’s the way it is, with or without waste in the system. Politicians of all stripes rail against waste — safely enough, given that waste has few proponents. But doing so won’t address, let alone solve, our financial problems.

    July 3, 2011
  205. john george said:

    Paul & Phil- I understand that various sectors of the economy experience inflation at different rates. Your comparisons above appear to be an “average”, since you are comparing the $2bn increase between the 2010/11 bieium budget of $32 bn to the $34 bn proposed by the legislature. The two largest expenditures in the budget are for HHS and Education. HHS is about 46%, so a 7% increase in costs here would represent about a 3.5% increase of the total budget. If they are going to play some catching up with education (about 38% if I remember correctly), then this could acount for another 3%. Dayton’s proposal is for another $2bn more. This is what I want to know where it is going. If HHS and education are going to be the main beneficiaries, then I don’t have a problem with it. If it is going to build barriers against the asian carp or a Vikings stadium, for instance, then I question the value of the investment.

    July 3, 2011
  206. Paul Zorn said:


    Again … there is no unaccounted-for $2bn.

    The question we’ve been discussing is how much more (or less) money is budgeted for 12/13, as compared to what’s actually been spent in 10/11, for state purposes. Only in that context can we judge whether anybody’s proposed budget represents a cut, an increase, or a steady state. How big future (or past) budgets should be is another interesting question, but it’s not the one we’re discussing now.

    In the present context the $32bn figure is simply not helpful. From what I can determine 10/11 spending was actually around $34.5bn — the “extra” $2.5bn having come from federal stimulus money. One might like or dislike this use of federal money, but we got it and we spent it (under a Republican governor … ). So it properly goes into the base of actual 10/11 spending.

    If the inflation percentage increase you mention (totaling around 6%, say) is applied (as it should be for these purposes) to the $34.5bn, we get upwards of $36.5bn — less than Gov Dayton has requested — even without accounting for increased general population, more school kids, and greater social needs in tough times.

    Alas, there’s yet another elephant (hmm, isn’t that one party’s symbol?) in the room: the $1.9bn “shift” in school funding that was committed in 10/11 under a well-established funding formula, but was never paid. Whether the state will ever make good on that IOU is far from clear. Either way, as far as I know the Republicans’ proposed 12/13 budget does not repeat this 10/11 scam. This is to the Republicans’ credit (if not scamming can be called a credit) but it obviously reduces funding available for other purposes.

    Yet again … the Governor’s $36bn proposal leaves no room for phantom billions in new spending.

    July 3, 2011
  207. Paul Zorn said:

    Oops … fuzzy math alert about 2/3 of the way through my posting above. $36.5bn is more — not less — than Gov Dayton has requested.

    OK, I’ll go away now.

    July 3, 2011
  208. David Henson said:

    Here and in conversations “on the street” both liberals and conservatives seem to be stepping back and saying something in out governance is broken … refreshing. One interesting note on health care is that when MNCare was an open fee for service system paid through subsidized premiums (meaning no HMOs involved) the cost was about 23% less. Meaning insured could go anywhere they wanted without controls then the HMOs jumped in to “save money” and cost jumped almost 23% overnight. The 23% appears to be their administrative overhead.

    The overall acceptance of the inflation levels in health care are the scariest part of the debate – “if they get you asking the wrong questions they don’t have to worry about the answers.” CT scans as an example should be free at the grocery store the technology is so old and well understood … yet medical providers are probably claiming the need to up the cost again.

    July 4, 2011
  209. john george said:

    Paul Z.- I will go back to your comment 54.3.2 and reference your comment about the spread sheet. You keep saying there is no unaccounted for $2bn. I say there is NO accounted for spending beyond the general departments of HHS, Education, DNR, DOT, etc. Within those categories, I know nothing of how the $$ are being disbursed. That is all I’m asking for, and I think it is my business.

    July 4, 2011
  210. Paul Zorn said:


    You make a fair point about what’s “accounted” for — I used the a-word too loosely. Mea culpa.

    Indeed, I think we agree that something like the data table described in 54.3.2 — an accounting, if you will — would shed a lot of light on these matters. If this information exists (could it really not?) I haven’t seen it, so for me, too, the $2bn difference between $34bn and $36bn is literally unaccounted for. Either I’m looking in the wrong places, and it’s my fault; or this information is not widely available, and I blame whichever pols are not telling.

    What I meant to convey (despite my poorly chosen a-word) still seems to me most important: that the “extra” $2bn we’ve been talking about does not suggest to me any real expansion in government programs, let alone evidence of waste (as suggested in 54.3.3). “Inflation” in the various senses discussed above is more than enough to account for this amount of “new” spending.

    July 4, 2011
  211. Paul Zorn said:

    David H,

    Can you give any references for the 23% figures you cite? Maybe they’re right, but I’d like to understand the calculation.

    I wonder, too, what you mean by “overall acceptance” of health inflation rates. To “accept” that inflation (and poverty, racism, illness …) exist is not to endorse any of these things. What part do you find “scariest”?

    July 4, 2011
  212. john george said:

    Paul Z.- I’m glad you can’t find the info, either. I don’t feel like I’ve missed something just out of not knowing how to research it. The idea of having to pay for inflated costs in medical services is probably debateable, depending on your association with the medical field. Whether the losses claimed by the providers when they accept Medicaid payments are real or not may be hard to document, depending on what $$ amount of value is placed on the service and how one arrives at the figure. I only have knowledge of the industry my wife is involved in. I know those figures are pretty firm, so I have a tendency to believe the other areas of the field are running short, also.

    As far as education, two of my daughters who taught in public schools left that level because of all the unfunded requirements placed upon them. It is one thing to require a business to meet certain standards (OSHA, ADA, etc.) when they have the ability to raise their prices to cover the extra costs. For the government to place greater and greater demands upon public educators, but not give them money to meet those requirements, then they really don’t have anyplace else to turn. This is the same thing that has happened in my wife’s industry. It is this type of government programs that I think are broken and need to be fixed.

    July 4, 2011
  213. David Henson said:

    Paul, I worked for an HMO management company at the time and MN Care only briefly ran as a free choice system at its inception – I believe the numbers are correct but have no article to point you towards. Funding a 2 billion dollar increase to fund further inflation into an already overpriced and overbuilt medical system seems “nuts.” How does further funding ever halt the inflation (I guess when it kills the economy, unemployment rockets and the government shuts down … wait a minute).

    I think where I differ most with you most is that without a free market where actors choose how and where to spend their dollars a society cannot sustain itself to the greater good. If you took most of the tax dollars (fed and state) and just gave each citizen a check and they could decide on allocations between a gym membership, fixing balding tires and health insurance then health costs would plummet and quality would soar. We need to get back to the motto “its a free country.”

    July 5, 2011
  214. john george said:

    David H.- I’m surprised and shocked you do not recognize our “free” country. Free medical coverage, free education, free food….. The question is for whom is all this free?

    July 5, 2011
  215. Kent Scheer said:

    Next topic, there are important business ethics issues to be resolved for Think Mint of Northfield….David ?

    July 5, 2011

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