Crossing the partisan divide: Minnesota budgets and politics in the 1980s

It is a familiar story: A major national recession — the most severe since the Great Depression — rolls through Minnesota, provoking a massive state budget deficit as a Republican governor faces off against his DFL foes in the Legislature.

Al Quie
Al Quie circa 1982

But this is not today’s story. It is an old one that took place nearly 30 years ago. The time was the early 1980s, and the governor was Al Quie. Unlike 2009, when the final chapter in the current budgetary saga has yet to be written, we know how the budgetary battles of that era were finally resolved.

The affable Quie had been a 20-year congressional incumbent representing Minnesota’s First District when he decided to challenge DFL Gov. Rudy Perpich in 1978. Quie survived a tough race and ousted Perpich as part of the DFL “massacre” of that year, which saw Republicans gaining both U.S. Senate seats as well as the governorship.

Deficit was nearly 17 percent of budget
The newly elected governor soon found that he was facing mounting state deficits as revenue estimates throughout his four-year term continued to drop. For the 1982-83 biennium, Quie eventually faced a deficit equal to nearly 17 percent of the state budget. According to Mitch Pearlstein, who served on Quie’s staff and wrote a biography of the former governor in 2008, the budget crisis facing his former boss was as serious as the one currently facing Minnesota in 2009.

In 1979, within months after taking office, Quie was able to win legislative approval for a tax-indexing plan, which protected Minnesota taxpayers from being pushed into higher brackets as a result of the inflationary spiral spinning through the U.S. economy.

Indexing had the result of reducing state revenues by nearly $800 million and exacerbating the deficits that would continue to plague Quie during the remainder of his four-year term, as he called one special session after another to deal with the on-going revenue short-falls.

Unlike 2009, when Minnesota’s current governor has taken a hard line against any tax hikes, Quie was willing to negotiate with the DFL Legislature on revenues and expenditures. But those negotiations kept breaking down when DFLers kept demanding more tax increases and fewer spending cuts than Quie was willing to accept.

Forced to call another special session
During Quie’s troubled term, the state’s budget crisis came to a head in December 1981 when lagging revenue estimates revealed a new $768 million deficit. Again, Quie was forced to call a special session and renew his wrangling with DFL legislative leaders over tax and spending priorities.

By mid-month, the gap between the governor and the Legislature appeared to be closing when Quie hinted that he might be willing to accept some modest tax increases in return for more spending cuts, but a budget-balancing deal was never closed.

As the special session spilled into January, DFL legislative leaders were able to win a handful of Republican votes for a new plan that included a temporary income-tax surtax, new spending cuts and some spending shifts into the next biennium.

Three days of squabbling
Quie agonized for three days as his advisers squabbled among themselves over whether he should sign or veto the bill. Finally, reluctantly, he allowed the bill to become law without his signature.

Maintaining that he did not want to endorse what he considered a “bad bill,” Quie told the Minneapolis Star’s Betty Wilson that his veto would only have made a bad situation even worse. He explained that a veto would have forced him to cancel the huge state payments to local governments, which would have seriously disrupted law enforcement, fire protecting and other necessary public services.

The January 15, 1982 headline from the Minneapolis Star.
The January 15, 1982 headline from the Minneapolis Star.

Quie’s acquiescence to the DFL budget plan drew barbs from both sides of the political aisle.  As Republican and DFL activists alike criticized him for his perceived lack of leadership, Quie announced in late January that he would not run for re-election to a second term in 1982.

In looking back, more than 20 years later, a reflective Quie provided the Star Tribune’s Lori Sturdevant with the rationale for his approach to the budget crisis of the early 1980s. “The question I had to come to was like this,” Quie explained. “You have a budget. You and your spouse are really staying within that budget. You look to the future, and you are going to be OK. Then your child comes down with a disease, and insurance doesn’t cover all the costs. You’ve just got to break that whole thing, because your love for your child is greater than all your budget principles. In public office, that is what you need to look at.”

Today, in 2009, what appeared to be lack of leadership on Quie’s part is being hailed in many quarters as responsible pragmatism and political statesmanship.

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Comments (4)

  1. Submitted by Beryl John-Knudson on 05/13/2009 - 08:59 am.

    Maybe Pawlenty is suffering from a legislative form of Swine flu…

    Pawlenty as one swilled down by “budget principles”, may translate better as pigheaded partisanship.

    However, I certainly do agree, Paw lacks “responsible pragmatism and political statesmanship.”

  2. Submitted by Jeremy Powers on 05/13/2009 - 01:21 pm.

    Now I grant you, the DFL doesn’t have much history to use in comparison during the last 50 years of governor’s office, but Gov. Wendell Anderson and Gov. Rudy Perpich showed A LOT more leadership in their office did virtually any of the Republicans or Gov. Ventura.

    During Anderson’s and Perpich’s times, we had the governor out there trying to build jobs and infrastructure that led to jobs. Pawlenty has made it clear that leadership is sniping from the sidelines because being accused of actually doing something is no way to be nominated by his party for president. Ventura was the “dog that caught the car.” (“Now what do I do?”) Carlson, who was really more DFL light during a time of Republican house control, was mostly a caretaker. Al Quie – well let’s just say for someone elected 11 times to Congress and once to the governor’s mansion he has an incredibly short Wikipedia listing. LeVander was a classic Yankee Republican who may have favored smaller government, but actually did something in office by forming the Met Council and the PCA.

    I was in college during Quie’s years and remember the students passed their own tuition increase to help pay for college. After it passed, Quie said he wasn’t bound to use the money for colleges and spent it elsewhere. I would bet that Quie didn’t go on a public college campus after that.

  3. Submitted by John Olson on 05/14/2009 - 06:48 am.

    It’s worth noting a couple of very large differences between then and now:

    – Health care costs were nowhere near what they are today. I have heard (but cannot verify) that the State of Minnesota spends more on health care than the entire state budget of North Dakota. Even if this is not accurate, it is safe to say that health care costs are *the* major cost driver in Minnesota’s budget.

    – At that point in time, us “Baby Boomers” were largely in the workforce or darn close to entering it. Our parents were in their prime earning years.

    It’s nice to be nostalgic and recognize the “good old days” for what they were, but today’s circumstances are very, very different from then. So was our economy.

    Until a viable approach to reining in health care costs can be found, I’m afraid these budget messes are not going to get any better.

  4. Submitted by Greg Kapphahn on 05/14/2009 - 03:43 pm.

    Let’s not forget the main difference between Al Quie and Tim Pawlenty. Quie was interested enough in the well being of the state of Minnesota that he was willing to commit to not running for another term as Governor in order to accomplish the needed compromise. He knew it would bring his political career to an end, but cared more about the state than himself.

    Governor Pawlenty, on the other hand cares nothing for the state of Minnesota, but operates with his eye glued to the prize of a higher position in the National Republican Party. He will uphold his promise to the MN Tax Whiner’s League and their spiritual leader Grover Norquist, even if it means people die for lack of medical care or nursing home staff.

    In other words, Al Quie was and is a statesman. Tim Pawlenty is a Republican political operative. One an eagle, the other a weasel.

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