The recent state economic forecast confirms what Minnesotans already are feeling in their pocketbooks. The state’s economy is weakening with no immediate signs of a turnaround. The decline in corporate tax receipts especially underscores the financial strains facing the business community, and thus the state’s overall vitality.
It’s why the Minnesota Chamber of Commerce encourages policy-makers to heed the advice of those who have staked their financial resources to create jobs in Minnesota. Their counsel is pretty simple and clear: “Now is not the time to increase tax burdens, especially as businesses compete in a global marketplace.”
The forecast might be just the beginning of more distressing times. Our visits with business owners across the state give us the sense that the Greater Minnesota economy is in better shape than Minneapolis-St. Paul. If true, that’s noteworthy. The Twin Cities economic engine dwarfs that of Greater Minnesota.
Here’s what 700 business leaders report
It’s opportune that the economic forecast coincides with the annual report of Grow Minnesota! — the Minnesota Chamber’s distinctive private-sector program focused on job retention and creation. Our one-on-one conversations this past year with more than 700 business leaders — the eyes and ears on the state’s economy — provide a compass for policy-makers.
That course is charted in two avenues. No. 1, the Legislature must correct public policy that hinders job growth. No. 2, greater attention must be devoted to helping businesses solve their everyday problems. The Minnesota Chamber stands ready to assist.
Businesses face many issues, but four priorities top our 2008 legislative agenda:
Health care: Costs continue to rise and yet high-quality shortcomings persist. The dynamics have forced some companies to reduce employment in order to minimize costs. Significant headway will not be achieved without bold and innovative measures. Consumers must be armed with the necessary information to compare health care products and services on results and price so they will demand the greatest value for their dollars.
State taxes: Businesses hold no illusions that Minnesota will ever be a low-tax state and are generally willing to pay a premium for high-quality public services. At the same time, companies make it clear there is a limit. Our conversations with business leaders underscore that they demand greater value for their taxes, especially given our demographics. The consequences of our graying population are clear: Fewer workers will be paying taxes into the state treasury, and more individuals will be relying on public programs. Delivering more value per dollar is the only way to serve our aging population and be competitive in today’s world economy.
Workers’ compensation: Workers’ compensation costs are at the forefront again, largely the result of rising medical expenses. We are committed to working with providers to achieve savings for employers.
Transportation: An efficient and safe transportation system is an essential ingredient for a prospering economy. The Minnesota Chamber led the successful campaign for passage of the Transportation Amendment in 2006. We are committed to taking the next step by developing a balanced and substantive funding package for roads, bridges and public transit statewide.
Advancing changes in public policy is imperative, but another component is equally important to reinvigorating Minnesota’s economy. Our Grow Minnesota! program has seen the benefits of giving businesses personal attention. It might be helping a company acquire permits for new boiler technology, or identifying a raw material supplier for a firm’s manufacturing process, or assisting in a search for buildings and sites for a company expansion.
The common denominator is that providing this assistance means one less worry for business owners, who have their hands full running their operations. These efforts typically cost little — except time — require no legislative action and mean an enormous amount to the companies receiving assistance.
We agree on problems but not proposed ‘recipe’
The state’s economic forecast has resulted in the predictable calls from some corners to increase the state’s investment — read: raise taxes — to fund health care, education and transportation. We agree on the critical problems to solve, but we part ways on the recipe for results. So much has changed in our economy in the last 15 years that we cannot accept “It worked before” as the rationale for raising taxes to solve key economic problems.
We need to act, but a 1970s response in a world that’s light years different won’t work and puts thousands more Minnesota jobs at risk.
Businesses face a great deal of uncertainty during this weakening economy. Now is not the time to increase their costs and potentially drive them out of Minnesota. Let’s instead work together to seek 21st century solutions to problems holding back the development of our economy. Those solutions will serve the best interests of all Minnesotans.
William Blazar is senior vice president of public affairs and business development at the Minnesota Chamber of Commerce.