Minnesota economic officials see good news/bad news situation in latest budget forecast

It was a really good news, bad news sort of morning at the Capitol this morning.

First, the really good news: Minnesota Management and Budget released a forecast showing that the state is $1.160 billion better off than expected.

State economist Tom Stinson, as his his wont, wasn’t exactly doing back flips over the forecast.

Both Stinson and Jim Showalter, the commissioner of Management and Budget, pointed out that there’s still a $5 billion deficit. No small hole.

“There’s some reason for caution, some for optimism,’’ said Stinson.

Stinson said actions in Washington were the big reason for improvement in the budget woes in Minnesota. The  tax  compromise between President Obama and the Republican Congress put more money in the pockets of consumers. That compromise included an 11-month extension of unemployment benefits, which also have been helpful to stimulating the economy in Minnesota, Stinson said.

More good news, bad news, according to Stinson.

This forecast does not take into account “geo-political’’ impacts on the economy. It’s unknown, for example, what the impact of events across the Middle East will have on the international economy, particularly gas prices.

On the other hand, Stinson said, that the employment picture still is lagging. If unemployment is reduced, there would be reason for optimism.

Check back later for further coverage and analysis.

You can also learn about all our free newsletter options.

No comments yet

Leave a Reply