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Rebating the nonexistent Minnesota surplus: Dumb, dumber — and brilliant politics

The call for rebating all of the surplus is politically brilliant.

So Keith Downey and the Republican Party of Minnesota are running ads saying they want to give back all of the $1.9 billion state surplus to Minnesotans. Quiz time.

 This idea is:
 a) Something they actually believe.
 b) A way to make Kurt Daudt and the House Caucus ideas seem reasonable.
 c) A smart political move.
 d) A fiscally dumb idea.
 e) All of the above.

schultz portrait
David Schultz

The answer is e), all of the above. Why is that the correct answer? Examining the politics of the budget surplus and how the DFL is just about ready to get out-maneuvered politically by the Republicans on it tells one a lot about state politics and the fortunes of the two parties.

A continuation of the party mantra

Let us begin first by declaring that rebating the surplus is actually something that Downey and most Republicans actually believe in. Rebating the surplus is really a continuation of the party mantra for the last 35 years, which has stressed tax cuts as a Republican solution for almost every problem confronted. Economy in a funk? Cut taxes. Economy doing well? Cut taxes. Need better roads and bridges? Cut taxes. Expensive housing? Cut taxes. It is a one-size-fits-all answer, but it has been a successful one for the GOP fortunes. Its base loves the idea of tax cuts, and many actually do believe that it is the best way to help the economy. When GOP Keith Downey was a legislator he never met a tax cut he did not like, and it’s no surprise that he, along with many Republican legislators, believes that the best thing for the state of Minnesota is simply to rebate all of the money back.

Yet even if it is an idea that Downey does not actually believe, it is a terrific way to make Speaker Kurt Daudt and the Republican House caucus proposals look good. Their ideas variously call for cutting taxes, spending more on education, and also using the money to repair roads, bridges and highways. These are all great ideas that appeal to their base who want tax cuts but also to rural constituents who feel that too much spending is going to Twin Cities mass transportation. Spending on education is a good priority that appeals to swing voters, and it is also a way to help undermine some of the equalization formulae that try to rectify imbalances in tax bases across Minnesota school districts. The problem with their proposal, of course, is that $1.9 billion will not go very far toward paying for many of these projects. Additionally, so far the House has not been clear in that the big winners of their proposals, especially the tax cuts, will not be working- or middle-class Minnesotans.

Politically brilliant

But nonetheless, the call for rebating all of the surplus is politically brilliant. The public hears surplus and thinks, “The government has too much of my money, I should get some back.” The idea of rebates sounds terrific – mailing checks to voters or giving them rebates at a time when Minnesotans are doing their taxes. It was a tactic used once by Gov. Jesse Ventura and the legislature back in 1999-2000, and it was popular. Everyone loves Santa Claus; everyone loves people who give us gifts.

Tax cuts have been a staple message of Republicans for decades and there is no reason to think it should not continue to be a successful message into the future. It is a great wedge issue against Democrats. How can they oppose giving the people their money back?

If DFLers do not support it they are just the tax-and-spend liberals we know they are. They are the party of big government and extravagant state office buildings, refusing to help working Minnesotans out by sending them a few hundred dollars back.

Dumb on many grounds

But rebating is simply dumb on so many grounds. One again needs to point out that of the $1.9 billion the first billion does not exist. If all of the current programs funded by the state are continued at their same spending level into the next biennium it will cost the state another $1 billion to fund them because of inflation. In order to reap this first billion as a surplus one needs to cut $1 billion in spending first.

Second, the surplus is only a surplus because of the tax increases. Cut the taxes and the surplus disappears. There is no structural surplus.

Third, the other $900 million is hardly a surplus either. With Dayton having proposed a $40 billion biennium, that $900 M is barely 2 percent. If we think of the total real obligations that the state has for the next two years, which include both what Minnesota pays for along with the federal government, real spending obligations increase by tens of billions of more dollars. That $900 M is nothing. Assume any serous federal budget cuts or another shutdown and the state is still on the hook and has no money as a cushion. Or assume that there are other natural disasters that occur and a special appropriation is needed. Or simply assume a slowdown in the economy or even that the surplus forecast is off just a percent or so. Suddenly that $900 million is gone.

Bad accounting

The margins for error are great here. Giving away this remaining $900 million is bad accounting. Generally accepted accounting practices declare that organizations should have contingency funds or accounts set aside. It should be a certain percentage of a budget. The exact size of the contingency depends on risk, but a 5 percent contingency of an entire budget is not out of line. Thus, smart budgeting suggests that saving this remaining $900 million would be good accounting.

On top of which, the last time the state gave away its surplus was back when Ventura was governor. The state of Minnesota went from an approximately $4.5 billion surplus in 1999 to a multibillion-dollar deficit in 2002. To this day Minnesota has yet to recover from the stupidly of this move along with the changes in budgetary law that have continued to create the fiscal problems that face the state.

Thus, the correct answer is all of the above. Those of you who gave this as an answer can go to the head of the class.

David Schultz is a Hamline University professor of political science and the author of “Election Law and Democratic Theory” (Ashgate, 2014) and “American Politics in the Age of Ignorance” (Macmillan, 2013). He blogs at Schultz’s Take, where this piece first appeared. 

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Comments (48)

  1. Submitted by Thomas Swift on 03/17/2015 - 01:42 pm.

    “Second, the surplus is only a surplus because of the tax increases. Cut the taxes and the surplus disappears. There is no structural surplus.”

    Wow. I wonder if David really meant to be that forthcoming.

    • Submitted by Jonathan Ecklund on 03/17/2015 - 02:19 pm.

      Yes

      That’s the reason for the tax increases in the first place. Now to make them more progressive by adding a new, higher bracket with a higher tax rate.

      • Submitted by Tom Anderson on 03/17/2015 - 08:22 pm.

        Didn’t we just do that?

        ” adding a new, higher bracket with a higher tax rate.”

        That’s where lots of the $2 billion came from. It also raised our state ranking for higher income tax.

        • Submitted by Matt Touchette on 03/18/2015 - 10:07 am.

          Isn’t that ranking based off the average for all tax payers? Is there a ranking, by state, of state tax rates for ~sub-$150k households?

        • Submitted by Jonathan Ecklund on 03/20/2015 - 08:55 am.

          Yes, but I would argue that we still need another higher bracket at a higher marginal rate. That would allow a small marginal decrease for many in the middle and at the lower-end of the spectrum.

          Granted, it would help if certain corporations weren’t dodging US corporate taxes.

          • Submitted by Steve Rose on 03/20/2015 - 10:01 am.

            “Dodging Taxes”

            I think it is something that most of us do. Speaking for myself, I do it. Of all the deductions available to me, I take 100% of them. Call me greedy, but honestly that is what I do. Those that don’t, they are the ones that do more than their share to fund the government.

            Corporations seek revenue and minimize expenses, just like people do. It is key to the short and long term viability and to the profitability of the corporation. Taxes are an expense to be managed, and corporations employ lawyers and accountants to plan and execute a tax strategy. Staying within the bounds of the law, they will take every deduction and maneuver in and around the tax code to minimize their tax expenses. That serves all of the corporation’s stakeholders, including the employees.

            If you don’t the like dodges, change the tax code to encourage a different behavior.

            • Submitted by Jonathan Ecklund on 03/20/2015 - 11:15 am.

              I don’t dodge my taxes. I pay the maximum withholding in an attempt to not have to pay extra in at the end of each year. If you are within your legal right to take itemized deductions, do so.

              I think it’s un-patriotic for American corporations, which have benefited from American legal protection, the american workforce, our trading status, etc, to shelter their profits oversees and invert their corporate structures so they can short-change the USA while giving themselves fat payoffs.

              I would love to change the tax code so that billion-dollar corporations in the US weren’t literally paying zero dollars in taxes. Are you going to work to elect Republicans who don’t view Democrats as amoral enemies?

              • Submitted by Steve Rose on 03/20/2015 - 12:20 pm.

                Payroll withholdings and your tax liability are not the same

                I am not familiar with the concept of maximum withholding. You can have any amount withheld that you choose; it need not be stated in number of dependents, but can be a dollar amount.

                Tell me, on your income tax returns which deductions do you forego, mortgage interest, sales tax, vehicle tabs? I take all of those opportunities to reduce my tax bill.

                Your party didn’t need the cooperation of Republicans to move legislation to the President’s desk. Obamacare received no Republican votes. Your Democratic party didn’t want to reform the corporate tax code. They had the opportunity and did not take it.

                • Submitted by Jonathan Ecklund on 03/20/2015 - 01:32 pm.

                  Hold on there- the ACA received no Republican votes because Republicans pouted and refused to participate, even though it’s patterned entirely off of Republican plans (The Heritage Foundation, Bob Dole, Mitt Romney).

                  It had nothing to do with what was in the bill. It had everything to do with who the POTUS is. And Mitch McConnell’s declaration that his number 1 priority was to make Barack Obama a 1-term president. And quite possibly, the color of his skin, for some. Don’t forget ‘You Lie’ Joe Wilson, Jan Brewer’s finger-wagging, senate Repubs inviting a foreign head of state in an attempt to contravene ongoing nuclear negotiations; the modern Republican party has refused to work with Barack Obama on anything.

                  Indeed, they’ve refused to be respectful, or even truthful.

                  • Submitted by Steve Rose on 03/20/2015 - 02:16 pm.

                    Distracted by an Example

                    Obamacare was an example of what can be done by a President whose party controls both legislative chambers, nothing more. Let’s get back to your unaddressed tax dodging post. At least answer the question, on your income tax returns which deductions do you forego, mortgage interest, sales tax, vehicle tabs? Give us some tips on generosity aimed at our federal treasury.

                    • Submitted by Jonathan Ecklund on 03/20/2015 - 03:36 pm.

                      I am not going to go in-depth with you on my personal tax returns. Period. I’m not dodging any question, either, that is relevant to the topic I brought up, of corporate entities using their vast wealth in order to protect their vast wealth from due taxation… which trickles down to the rest of us in deficits and increased fees. I acknowledged that while you propose changing the tax code, there is one party that will simply refuse to negotiate with the POTUS or the Democrats, or will load any potential agreement with poison pills.

                      Back to my point, about SOME of many tax-dodging corporations:
                      Verizon made $19.3 billion in US pretax profits from 2008 to 2012, yet didn’t pay any federal income taxes during the period. Instead, it got $535 million in tax rebates. Verizon’s effective federal income tax rate was negative 2.8 percent from 2008 to 2012.

                      Pfizer paid no US income taxes from 2010 to 2012 while earning $43 billion worldwide. It did this in part by performing accounting acrobatics to shift its US profits offshore. It received $2.2 billion in federal tax refunds.

                      Honeywell had profits of $5 billion from 2009 to 2012. Yet it paid only $50 million in federal income taxes for the period. Its tax rate was just 1 percent over the last four years. This gave it a huge tax subsidy worth $1.7 billion.

                      ExxonMobil had a three-year federal income tax rate of just 15 percent. This gave the company a tax subsidy worth $6.2 billion from 2010-2012. It had $43 billion in offshore profits at the end of 2012, on which it paid no US taxes.

                      Citigroup had $42.6 billion in foreign profits parked offshore in 2012 on which it paid no US taxes. It reported that it would owe $11.5 billion if it brings these funds back to the US. A significant chunk is being held in tax-haven countries.

                      http://www.americansfortaxfairness.org/files/Corporate-Tax-Dodgers-Report-Final.pdf

                    • Submitted by Steve Rose on 03/20/2015 - 10:27 pm.

                      I have no interest in your personal tax returns; I thought you might admit that you take all the deductions you can to minimize your tax burden, just like other citizens and and like corporations. As I pointed out above, the President and his party had ample opportunity to rewrite the tax code, and did not. Perhaps they feared that more tax burden would send more business offshore.

                      Your link makes a point that companies are not paying U.S. income taxes on foreign profits. Why would they? The linked article makes no accounting for the taxes the companies pay in the countries where the income is earned.

                      ExxonMobil in 2011 made $27.3 billion in cash payments for income taxes. Chevron paid $17 billion and ConocoPhillips $10.6 billion. And not only were these the highest amounts in absolute terms, when compared with the rest of the 25 most profitable U.S. companies, the trio also had the highest effective tax rates. Exxon’s tax rate was 42.9%, Chevron’s was 48.3% and Conoco’s was 41.5%. That’s even higher than the 35% U.S. federal statutory rate, which is already the highest tax rate among developed nations.

                      http://www.forbes.com/sites/christopherhelman/2012/04/16/which-megacorps-pay-megataxes/

    • Submitted by Thomas Swift on 03/18/2015 - 10:21 am.

      He has admitted that the “robust economy” the DFL has been touting is nothing more than puffery; the healthy bank account Dayton is itching to get spent came at the expense of the citizens take home pay, not as the result of progress, which isn’t necessarily helpful as bread and butter Minnesota companies like Target find themselves re-shuffling their plans.

  2. Submitted by Karen Sandness on 03/17/2015 - 03:26 pm.

    By law, Oregon is required to rebate surpluses to the taxpayers

    It sounds like a good idea, but here is how it worked in practice:

    1. Naturally, your rebate is proportional to the size of your tax bill, so the richer you are, the more you receive. During my time in Oregon, I consistently earned something like the state’s median income, and my rebate never exceeded $80. Whoopee. This meant that half the households in the state received less, while major corporations such as Nike received more.

    2. The rebates went out during boom times, but like all booms, these inevitably ended, and tax receipts would drop sharply in a poor economy. With no cushion, the state was forced to cut services. This exacerbated the imbalances created by a flawed initiative system that allowed cranks with an agenda to craft ballot measures that imposed spending requirements without any method of paying for them. (Unfunded initatives were a large part of California’s budget problems, too.)

    It’s not always valid to compare a government to a household, but in this case we might ask people what they would do if their employer gave them a bonus. Would they pay off debts? Would they order long-delayed but necessary expenditures such as repairs? Would they save the money in anticipation of future purchases or unforeseen setbacks? Or would they give it back to their employer, because “after all, it’s his money”?

  3. Submitted by Logan Foreman on 03/17/2015 - 03:36 pm.

    “Dumb and Dumber” covers this latest

    Republican hoax. People will be smarter because they saw and suffered from the result of the giveaway hoax in 2000. A horrible economic mess for a decade (except for the rich) for a small one time check. Remember that the republicans had to be forced essentially to pay back the schools. They take but don’t care to pay.

    • Submitted by Matt Touchette on 03/18/2015 - 10:05 am.

      Too much credit…

      I think you’re giving the general population too much credit.

      • Submitted by Logan Foreman on 03/18/2015 - 02:11 pm.

        You may be right but

        The large majority still like the rich paying their fair share of taxes which doesn’t equate with large giveaways based on 2 years.

  4. Submitted by Craig Wilson on 03/17/2015 - 04:54 pm.

    Republican Party Fundraiser?

    Could it be that the ad run by the Republican Party, in opposition to the positions held by the Republican leadership, was just a fund raiser to help the party get out of debt? Instead of costing the debt-ridden Republicans money, could some deep pocketed donor have used them for cover while “borrowing” the party label for the cost of the ad, plus handling fees?

    It would be interesting to follow the money on the ad campaign and see.

  5. Submitted by Rachel Kahler on 03/17/2015 - 06:40 pm.

    I would support a rebate of $900 million. But only if it all came to me. I’d even pay in half of it in taxes 😉

  6. Submitted by Tom Anderson on 03/17/2015 - 08:26 pm.

    Isn’t 40 billion the figure for the last biennium?

    The latest I’d read on the Governor’s plan was $42.5 billion.

    Regarding the article, if the first $1 billion is taken up by inflation, doesn’t that mean that inflation is running at 2.5%? 1 divided by 40 times 100 equals 2.5%. Janet Yellen wouldn’t stand for that.

  7. Submitted by Paul Udstrand on 03/17/2015 - 09:07 pm.

    Not brilliant

    Basically republican economics and budget planning is magical thinking. The last time they did this was before the bug recessions and constant budget crises. Things have changed now. For some strange reason, Schultz is right, democrats never came up with a credible response to this obvious stupidity, but Dayton is a different breed. While Senate and House democrats by be stymied by this silliness, republicans have not been able to outmaneuver Dayton. I think this republican stunt will like backfire this time, people seem to be learning.

  8. Submitted by Dennis Wagner on 03/17/2015 - 09:45 pm.

    Very Well Done!

    Dave, Very well done article especially looking at it from a “Fiscally conservative/responsible” perspective, betting on the come is not a “fiscally conservative/responsible” strategy. Something Governor Arnie, last true fiscal conservative republican this state has seen, and Governor Dayton, could not only understand but legislate with true success!

  9. Submitted by Hiram Foster on 03/18/2015 - 05:53 am.

    “Naturally, your rebate is proportional to the size of your tax bill, so the richer you are, the more you receive.”

    Actually, there is nothing natural at all about that. You can return the rebate to anyone you want, or use it to benefit anyone you want. There is no “natural” reason to pay the rebate proportionately based on taxes paid.

    • Submitted by Robert Owen on 03/18/2015 - 06:26 am.

      Naturally, it is.

      A rebate is a return of overpayment. If the money you overpaid goes to someone else then it’s not a rebate, it’s a transfer.

      I could return my Target shopping cart to the Cub Foods cart corral. However Target owns that cart and probably doesn’t want it given to another store.

    • Submitted by Steve Rose on 03/18/2015 - 07:07 am.

      Veneer

      It is all about veneer; the government likes to paint a veneer of fairness. When the government overtakes from citizens to the point of needing to give it back, they feel the need to return to its rightful owner. Of course they don’t have to do that in Minnesota; they can do anything they choose, as you pointed out.

  10. Submitted by Hiram Foster on 03/18/2015 - 06:47 am.

    “Generally accepted accounting practices declare that organizations should have contingency funds or accounts set aside.”

    Well no. Generally Accepted Accounting Principles deal with things like recognition of income. They don’t tell you what to do with the income you recognize. In policy terms, it may make sense to set aside reserve funds, but GAAP don’t tell you to do that. At best, they simply show whether you have or don’t have such funds.

    More generally, the professor makes arguments that tend to resonate with Democrats, but are less than responsive to Republican or conservative voters. For fans of limiting government, the outcome of the Ventura tax rebates was just peachy, it is really up to Democrats, like myself to explain why they weren’t, and somehow that’s something we rarely get around to effectively doing.

    • Submitted by Steve Rose on 03/18/2015 - 10:02 am.

      “Arguments that tend to resonate with Democrats”

      For example,

      “… a Republican solution for almost every problem confronted. Economy in a funk? Cut taxes. Economy doing well? Cut taxes. Need better roads and bridges? Cut taxes.”

      The arguments that most resonate are the ones that contain no truth, example provided above. I don’t seem to recall a proposal to build better roads and bridges funded by a tax cut.

      • Submitted by jason myron on 03/18/2015 - 12:14 pm.

        Really?

        Well, there’s this one in Michigan which took me all of five seconds to find….

        http://www.eclectablog.com/2014/11/gop-house-speaker-wants-to-pay-for-road-funding-without-raising-taxes-by-cutting-you-guessed-it-education-funding.html

        • Submitted by Steve Rose on 03/18/2015 - 02:56 pm.

          Did you read your link?

          An excerpt for you:

          “Speaker Jase Bolger is proposing that we pay for billions of dollars in road and bridge repairs by cutting education funding so that legislators would “not have to raise taxes”.”

          Tax cut and not raising taxes are two different things; that is math: greater than, equal to, less than.

      • Submitted by Hiram Foster on 03/18/2015 - 01:50 pm.

        Resonating arguments

        I think arguments that have a grain of truth to them can be very effective. But the Republicans belief in the healing powers of tax cuts is more based on faith than it is on any rational analysis. The problem is that this faith isn’t challenged enough because it’s so widely seen as intuitively true. Even Democrats seem to believe it, arguing to themselves that the negative effects of higher taxes are offset by other stuff.

        I don’t think there is any extraordinarily persuasive reason to believe higher taxes are particularly bad for the economy. Taxes were high in the Clinton era and the economy prospered. Taxes were lower in the Bush era, and Bush’s policies generally came close to destroying the economy. High tax Minnesota has higher wages and lower unemployment than low tax Texas, despite the fact that Texas is afloat on an ocean of oil they never earned, and which Minnesotans have to pay high prices for.

        Obviously, the effect of taxation on the economy is much more complicated than my cursory analysis would suggest, but it’s those very complications which never seem to enter in the debate or never seem to really be addressed by those who are charged with actually creating tax policy.

        • Submitted by Steve Rose on 03/19/2015 - 06:57 am.

          Tax Policy

          “This administration pledged itself last summer to an across-the-board, top-to-bottom cut in personal and corporate income taxes to be enacted and become effective in 1963. I am not talking about a quickie or a temporary tax cut which would be more appropriate if a recession were imminent. Nor am I talking about giving the economy a mere shot in the arm to ease some temporary complaint. The federal government’s most useful role is not to rush into a program of excessive increases in public expenditures, but to expand the incentives and opportunities of private expenditures.” John F, Kennedy, Dec. 14, 1962

          Regarding demagoguery, it seems to no longer require a grain of truth, as I pointed out above (quote of David Schultz). Once an art form, demagoguery walked a fine line, playing in a gray area between fact and fiction, truth and falsehood. Now blatant lies are the order of the day, tired talking-point cliches are parroted into belief, low information voters are the target. Demagoguery is a lost art; it is no longer needed to get the job done.

          • Submitted by jason myron on 03/19/2015 - 12:49 pm.

            Look no further than the GOP

            for evidence of that assertion. Their entire ideology is based on fear and falsehoods. By the way, my example stands. There’s quite a bit more truth in it than a grain of sand…more like a beach. One Google search finds republican led legislatures all over the country struggling to find any way to fix roads without added revenue. It’s insanity and a prime example of how intellectual bankrupt these ideologues are. I would suggest you need to look at your own party when throwing out your customarily “low inflammation voter” remark. There isn’t another voting bloc that illustrates that more clearly.

          • Submitted by Bill Willy on 03/20/2015 - 03:55 pm.

            It’s simple: Just increase AND cut spending at the same time.

            “Tax cut and not raising taxes are two different things; that is math: greater than, equal to, less than.”

            May be. But it’s also important to remember that, sometimes, a spending cut is a tax increase:

            “In 2011, Minnesota policymakers cut the Renters’ Property Tax Credit by $26 million in FY 2013, or 13 percent, as part of actions to address a large state revenue shortfall.”

            http://www.mnbudgetproject.org/research-analysis/minnesota-taxes/credits/no-further-cuts-to-renters-property-tax-refunds-in-2012

            And then there’s the amazing example of how a Spending Increase can be a Spending Cut that was revealed in the Republican transportation plan that was rolled out in January.

            But just before that, in December, there was this:

            “Republican’s victory in the House this year was decidedly rural — 10 of 11 pickups were in rural Minnesota — and Daudt has repeatedly said his caucus is focused on ‘roads and bridges.'”

            (Because those rural Minnesotan voters – and their $500 to $1,000 front end repair bills – are focused on them too.)

            http://www.minnpost.com/politics-policy/2014/12/roads-again-lessons-last-big-transportation-debate

            But then, despite every road and bridge expert anyone can find (you know, those engineering- and construction-type people?) saying it will take $1 billion a year just to maintain those roads and bridges, a month later we heard this from the same “focused” politician-type people:

            “Republicans would pump $750 million into roads and bridges over the next four years, $200 million of which would come from the state’s $1 billion budget surplus. Republicans are also proposing to direct MnDOT to find $65 million in ‘savings’ and ‘efficiencies’ in their budget to put into things like pothole repair.

            “Their plan would also call on MnDOT to allocate 90 percent of the unreserved balance in the Trunk Highway Fund to roadwork for four years. Those dollars, which gather when projects come in under bid, would open up $223 million for road and bridge spending in 2016 and 2017 and another $282 million in 2018 and 2019.”

            http://www.minnpost.com/politics-policy/2015/01/two-roads-comparing-parties-transportation-funding-plans

            Nevermind that’s $3.25 billion less than those engineering- and construction-types say is required to do the job – – to me, the most interesting part of that plan is this:

            “Republicans would pump $750 million into roads and bridges” which means they would ADD that money to the Department of Transportation’s budget, with $200 million coming from the budget surplus (that they want to give back to hard working Minnesota taxpayers).

            AND – the interesting part – the Department of Transportation would be responsible for getting the OTHER $550 million of the $750 million – that “Republicans would pump into roads and bridges” – from the Department of Transportation budget.

            So, as we can plainly see, it really IS possible to Increase AND Cut spending at the same time AND be able to tell voters you were looking out for them by pumping $750 million into roads and bridges withOUT raising their taxes!

            And “that is math: greater than, equal to, less than.”

            Yes indeed. Why IS it the people of Minnesota just can’t get it through their thick heads that if we would just follow the Fiscal Management Strategies being put forward by Conservative Republicans TIME and TIME again, on every front possible, NONE of us would EVER have to pay taxes again!?

      • Submitted by RB Holbrook on 03/19/2015 - 09:28 am.

        Tax cuts

        It’s hard to believe, but there still are people out there who think that tax cuts will stimulate the economy and ultimately result in higher tax revenues (which, one supposes, could be used to build better roads or bridges). Despite all the evidence to the contrary (Kansas), these people cling to their belief like a child who refuses to deny the existence of Santa Claus, even when he sees adults putting the presents under the tree.

        Perhaps this argument resonates because, as you say, it contains no truth. It’s just sad when this kind of delusion gets enacted into policy.

  11. Submitted by Paul Udstrand on 03/18/2015 - 08:26 am.

    I’m not sure people will fall for this again

    Ventura’s tax rebate drove the state into deficits without providing any economic boost of any kind nor did it provide better or more efficient government. Then Bush tried it on a national level and I’ll be most Americans don’t even remember that. What is it? Something like $300? What people do and did with that money for the most part was pay down some credit card debt or other bills, so you’re rally just transferring the money to the banks and other investors.

  12. Submitted by Hiram Foster on 03/18/2015 - 10:26 am.

    “Ventura’s tax rebate drove the state into deficits without providing any economic boost of any kind nor did it provide better or more efficient government.”

    Sure, but it put tax money back in people’s pockets, Like it or not, that’s the argument that’s effective with many voters particularly those who believe that forcing a government into deficit which spends too much is effective management, and who don’t think it’s the government’s role to run the economy. I don’t necessarily believe those things, but I sit in a DFL choir that hears different sermons and which isn’t quite large enough to win elections.

    • Submitted by Paul Udstrand on 03/19/2015 - 09:29 am.

      I hear ya

      Ventura is widely considered to have been a flunk of a Governor.

      “but I sit in a DFL choir that hears different sermons and which isn’t quite large enough to win elections.”

      I would suggest the problem is your DFL choir, not the republican argument. For some reason the DFL responds to these republican arguments by going on the defensive and running away from it’s accomplishment most of the time. Sure, people may like a little extra cash in their pockets but arguments for better schools, roads, safe streets, and water mains that don’t collapse are just as if not more persuasive. The problem isn’t that DFL doesn’t have good arguments, the problem is they don’t to make the case effectively.

      Look at the DFL today and in the last election; we have one of the most popular DFL Governors in over a decade and they are actually distancing themselves from him, and did so during the campaign. He won, they lost, hmmmm.

      Ventura and Pawlenty made the big argument for tax cuts and rebates, Dayton did the reverse, and Dayton’s approval ratings are 10-20 points higher than Pawlenty or Ventura ever saw. At one point in 2012 Pawlenty’s disapproval rating was as high as 50% while Dayton’s hasn’t broken 30%.

      I have no idea what the DFL legislators are doing but Dayton is out there banging away for better schools and roads, and jobs and higher pay, and people are listening and he’s popular. It’s like the DFL doesn’t recognize popular and effective agendas even when someone drops them right on their heads.

      I’ve never run a political party and I’m not saying it’s easy but you don’t have to be some kind of Oracle to know that you don’t win elections with votes you never get, like people who don’t believe the government influences the economy. Instead of worrying about a small group of ideologues who will never vote for you, go after the majority that support your Governor. Why in the world would you think that distancing yourselves from a popular Governor is a winning formula?

  13. Submitted by Steve Rose on 03/19/2015 - 07:39 pm.

    Double Down

    “My example stands” is not an argument; it is a denial. Legislatures looking for ways to free up funds for roads and bridges look to tax cuts. You have chosen that position, now you need to support it.

    As for as the rest of your unsubstantiated talking point claims, bring out your sources.

    I did not associate my “low-information voter” remark with a party, but rather with demagoguery, which is not limited to any party nor ideology.

  14. Submitted by jason myron on 03/20/2015 - 07:01 am.

    I already have

    Denial…it’s just not a river.

    • Submitted by Steve Rose on 03/20/2015 - 08:38 am.

      On denial, we agree

      You have elevated it to an art form with ideas like, “Every politician that stuck with Obama in 2014, did well…the rest that ran away from him, lost.” and the one about Republicans proposing to fund road and bridge construction with tax cuts. Standing by these unsupported arguments is a lonely mission; even the author seems to have abandoned the claim about roads and bridges.

  15. Submitted by Hiram Foster on 03/20/2015 - 09:31 am.

    Dayton

    In political and partisan terms, the problem with Mark Dayton is simply a less than effective candidate without much of a political strategy beyond getting reelected. He is a member of the DFL party, but not really an aggressive DFL activist. And he is less a factor than we might want him to be in driving a DFL agenda at the legislative level, not that a governor is well positioned to do that, particularly one whose party doesn’t control both houses of the legislature.

    During the last election, Prof. Schulz published what was a rather widely circulated article basically on the DFL’s inability to craft a winning statewide strategy. Some of the language in that article was somewhat offputting, but on the whole, the article was both prescient, and not wrong.

  16. Submitted by Hiram Foster on 03/23/2015 - 08:33 am.

    Here’s the deal

    I think, with very little explicit supporting evidence at all, that much of Minnesota legislative history is based on and assumes a deal between the cities and greater Minnesota. Reduced to simplistic terms in the transportation area, the deal is you support our projects, and we will support yours.

    Am I right about that? Does anyone disagree?

    So there is this historic tradeoff, again in my view, which is implicit, but rarely acknowledged. The problem we are having is that this deal, and there are other deals like it in other areas, is under pressure from legislators who fail to acknowledge it or who are unaware that it exists. Again am I right about this?

    In the last campaign, Republicans campaigned on the notion that the cities were getting various forms of aid at the expense of Greater Minnesota. My question then, and my question now is, was this true? Was aid going to Greater Minnesota, according to the historic bargain, or wasn’t it? Professor Schulz in his article during the campaign suggested that Greater Minnesota was being neglected. Was this true? And did the neglect consist of lack of messaging or a substantive lack of support?

  17. Submitted by Bill Holm on 03/29/2015 - 05:30 pm.

    Selective & Biased Reporting

    Professor Schultz has certainly generated a big response to his inflammatory and condescending op-ed piece on state financial matters. Anyone who has followed the legislature closely for more than a month realizes that financial matters, especially the budget process mutate into many different versions, are explained in various tones, and often result in off-handed remarks by legislators who are merely blowing off steam.

    Dr. Schultz has selectively and purposely picked up bits and pieces of the overall debate, primarily capitalizing on Keith Downey’s opening salvo, “Give It Back to the People.” However, this was in response to Gov. Dayton’s initial boasting that he had almost single-handedly created a surplus. Right now the two sides have gotten serious and are intent on reaching an agreement both on transportation and on the budget. Other innuendos about Republican thinking reflect liberals concerted effort to filter out reasonably good ideas proposed by Republicans. Truly, a fragmented and chopped-up presentation of Republicans makes people think Republicans are idiots.

    Finally, Professor Schultz should be ashamed of himself. As a professional political science expert, he should know that there is quite a process involved in formulating legislative policies; it is not a simple game of name-calling, party bashing, or sensationalism.

    • Submitted by Dennis Wagner on 03/30/2015 - 09:28 pm.

      Solution for those politicians:

      Engage brain before engaging mouth!
      As JFK said “Paraphrase” “many people enjoy the pleasure of an opinion without enduring the pain of thought”

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