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Former Gov. Arne Carlson blames Tim Pawlenty for state budgeting problems

Arne Carlson contends that Tim Pawlenty, as majority leader of the House and then as governor, undid most of the changes the Carlson administration instituted.
REUTERS/Joshua Roberts
Arne Carlson contends that Tim Pawlenty, as majority leader of the House and then as governor, undid most of the changes the Carlson administration instituted.

Former Gov. Arne Carlson had one of those “hey-wait-just-a-minute” moments Thursday while reading a MinnPost article.

On the surface, the article, about government reform, seemed complimentary of Carlson, who was governor from 1991 to 1998.

Rep. Keith Downey, a leader of the reform movement in the Republican-controlled Legislature, was talking about how way back in the Carlson era a report had been issued calling for structural reforms to help government move from budget to budget more smoothly.

“We’ve been putting off reforms for 15 years,” Downey said. “The time to act is now.”

That’s the line that upset Carlson.

“Who’s this Downey fellow?” he asked me.

A representative from Edina starting his second term, the governor was told.

“If he’s starting his second term, he’s probably part of the problem,” Carlson said.

Carlson contends that his administration didn’t just point out the long-term structural problems in the 1995 report that Downey was referring to. Rather, it made the “reforms” necessary to correct the problems.

Carlson also contends that Tim Pawlenty, as majority leader of the House and then as governor, undid most of the changes the Carlson administration instituted. Along the way, Pawlenty got a little help from Gov. Jesse Ventura and some DFLers.

But mostly Carlson blames Pawlenty.

He says that Pawlenty closed the very department, Planning, that created the report Republicans now are citing.

He also says that Pawlenty, as House majority leader, was responsible, along with Ventura, for a disastrous change in the relationship between school funding and property taxes.

And he also says that Pawlenty showed that he wasn’t serious about budgeting because he never pushed for inflation to be considered a factor in out-year spending, only in out-year income.

Arne Carlson
Arne Carlson

It should be pointed out that Carlson’s dislike of Pawlenty has become personal. It also should be pointed out that Carlson has been exiled from the Republican Party for his public support of Tom Horner in the most recent gubernatorial election and his criticism for the conservatives who now control the party.

But most would agree that no governor ever took the budgeting process so seriously as Carlson.

Before Carlson, the governor’s office and Legislature only dealt with a one-biennium budget.  At Carlson’s insistence, the Legislature passed a law requiring that an out-year budget also be passed and balanced to bring more stability to government. In theory, the government was dealing with financial issues on a four-year basis, not a two-year basis.

But, Carlson said, Pawlenty never took budgeting seriously.

The first big budgeting debacle, however, took place when Ventura was governor and Pawlenty was the House majority leader.

Ventura wanted to separate state funding of K-12 education from property taxes. His plan was to pay for the $1 billion in property tax funding for K-12 with an expansion of sales taxes to such things as services.

The Republican-controlled House and the DFL-controlled Senate liked separating property taxes from K-12, but the House refused to expand sales taxes. Ventura, in a huff, signed a bill that that left a $1 billion hole in K-12 funding that had to come out of the general fund.

“I remember [DFL Sen.] Larry Pogemiller saying at the time, ‘We’re going to wake up with the worst hangover you can imagine,” Carlson said.

As governor, Carlson said, Pawlenty continued bad fiscal management practices.

“You don’t balance a budget with shifts and gimmicks,” said Carlson. “You use real numbers and real dollars.”

Inflation, for example, is not dealt with realistically in Minnesota budgeting, said Carlson.

The state counts on inflation for future incoming revenues but does not use inflation for figuring money to be spent in the future.

“Pawlenty always said that’s because you can control the costs of things like wages you pay public employees,” Carlson said. “But that’s just a small part of inflation. You can’t control the cost of fuel oil. You can’t control the cost of what you’ll have to pay for insurance and for gasoline for vehicles. It’s ridiculous.”

Gimmicks replaced the reforms of the Carlson years, Carlson said. Tobacco settlement money was used as a one-time budget-balancing fix. School funding aid was shifted. Federal stimulus money was used.

“Under Tim Pawlenty, it became deficit heaven,” said Carlson. “All the things we did were undone. Now, what bothers me is you get these holier-than-thou attitudes. Oh, we’re all to blame. But that’s just not true. There’s one person who has the power to insist on a balanced budget. That’s the chief executive officer, the governor.”

Doug Grow writes about public affairs, state politics and other topics. He can be reached at dgrow [at] minnpost [dot] com.

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Comments (16)

  1. Submitted by Greg Kapphahn on 04/22/2011 - 10:10 am.

    During his time as House minority leader and continuing into his time as governor, Tim Pawlenty worked diligently to set up the EXACT budget crisis in which we now find ourselves (this crisis IS NOT an accident):

    The crisis was, of course, designed specifically for the purpose of allowing our Republican friends to cry their alligator tears as they now tell the sick, the disabled, the elderly, the school children, the college students, the hungry, the needy of the state, “We’re SO SORRY, but YOU’RE just not sustainable anymore.”

    With the implication that all of those folks just need to make themselves as invisible in the state of Minnesota, by whatever means they choose – death if necessary,…

    as they and their suffering already are invisible in the dysfunctional worldview of Mr. Pawlenty and the current crop of Republican legislators who are very busily passing their bills to kill off the vulnerable citizens and future workers of the state of Minnesota,…

    “whistling past the graveyard” where all their wrongheaded, cold-hearted bills will be buried as soon as Gov. Dayton pulls out his veto pen.

    Of course they will scream as if they’ve been stabbed through the heart by that veto pen, but if it feels that way to them, perhaps that’s only fair and just considering the economic vampires they and their wealthy friends have become in our state.

  2. Submitted by Bruce Johnson on 04/22/2011 - 10:25 am.

    “…Carlson has been exiled from the Republican Party for his public support of Tom Horner in the most recent gubernatorial election and his criticism for the conservatives who now control the party.”

    The article is a pretty good summary of how we got where we are today fiscally. Carlson is on the outs with Republican insiders because he’s a fiscal conservative, and there are (apparently) no fiscal conservatives left in the Republican party. Making stuff up and not paying for things bought is behavior that could be described with many words, just not the word “conservative.”

  3. Submitted by Howard Salute on 04/22/2011 - 10:42 am.

    Thanks for posting Arne’s high school year book photo. Reminds me of the good old days.

  4. Submitted by Jim Roth on 04/22/2011 - 11:04 am.

    This article deserves wide distribution in connection with Pawlenty’s record and presidential aspirations.

  5. Submitted by Terry Nagle on 04/22/2011 - 11:23 am.

    I hope it’s not just my age, but the 90s sure are looking like the good old days.

  6. Submitted by Francis Ferrell on 04/22/2011 - 11:59 am.

    It’s funny how an old school but progressive Republican gets ostracized for sticking to core Republican values. I am a Democrat at heart and political beliefs but a more fiscal conservative when it comes to budgetary matters. In a reality a political centrist.

    When it comes to getting legislation passed, depending on this issues, I firmly believe in the precepts of ‘advise and consent’ and ‘compromise’. Arne Carlson typifies that political thinking. I/We may not always agreed with Carlson but in the end good things were accomplished because Carlson knew how to compromise and negotiate matters while keeping true to his core ideas. Something former Governor Pawlenty never seemed to truly realize and embrace.

    Minnesota Republicans now seem determine to change everything by slashing and burning the budget, not generating revenues, not reforming how state government works efficiently, and just plain digging the state further into the ground politically. New Democrats share some of this blame, too.

    Why don’t the Republicans listen to Carlson with his successful experience in budgetary matters? Even Governor Dayton should take a second opinion conference from Carlson who left this state fiscally sound. It doesn’t matter what political party you espouse it’s the end result or accomplishment that counts. With the exception of a few folks, the GOP controlled Legislature is a train wreck waiting to happen.

  7. Submitted by Lance Groth on 04/22/2011 - 12:46 pm.

    The Carlson administration was the last time sanity prevailed in Minnesota state government. I wasn’t much of a fan at the time, but looking back, the 90’s *were* the good old days, and Carlson did a fine job. I would happily trade everything that’s come since for another governor and a legislature that operated rationally. Dayton is probably in that mold, but saddled with a slash and burn legislature, I don’t see that there’s much he can do other than wield his veto pen.

    Ditto nationally. How did this country go insane?

  8. Submitted by Lyn Crosby on 04/22/2011 - 01:35 pm.

    Lance: One big reason is APATHY by the average (normal, moderate) voter. And of course there are various reasons for that. Some get turned off by the increasing partisanship and (esp.) right wing fringe. Some people are so focused on surviving the current economics, they don’t feel they can take the time to study the candidates or pay attention to politics, so they don’t.

  9. Submitted by Ron Gotzman on 04/22/2011 - 02:47 pm.

    No matter what amount of spending takes place or how high the tax rates, it will still not be enough to satisfy the DFL special interest groups.

    Even the Dayton proposed 22% increase in spending is criticized by some groups because it contains “cuts” and does not grow spending fast enough.

    From 1960 to 2003, the average two-year increase in Minnesota state spending was 21 %. Cutting that spending growth to around 4% during the T. Paws years is considered “draconian.”

  10. Submitted by Greg Kapphahn on 04/22/2011 - 02:59 pm.

    Well… apathy and MASSIVE amounts of misinformation and lies: especially the propagandistically repeated “big lie” that we could have exactly the state we loved, respected and could depend upon without paying for it.

    Of course all we’ve REALLY gotten is the fabulously rich growing even more fabulously wealthy while the rest of us were stuck in place if not going down the drain.

    But even THAT wasn’t enough, as we see from our current legislature, our “conservative” friends want to take it ALL away from us and give it to the only people they can see through their money googles – those same, fabulously wealthy folks whom they so worship and, at the same time, need to protect as if they were newborn babes.

    (the rest of us, especially those in need, are rendered invisible through those goggles).

  11. Submitted by Bernice Vetsch on 04/23/2011 - 10:26 am.

    Am I wrong, or did Governor Carlson and, I believe, Wheelock Whitney not leave the Republican party instead of the other way around? Or perhaps left and then returned in the vain hope it had returned to normal?

    How did this country go insane? One big factor has been Grover Norquist with his anti-tax message and his gospel of me-first-always, and those in the Taking Coalition (the poor, the elderly or disabled, trial lawyers, government and its employees), who should all just Leave Us Alone (his organization for those who resent the Taking Coalition like crazy).

    Plus the neocons who, like Norquist, bought into Ayn Rand, right-wing economists and and writers, a propaganda machine that won’t quit until everyone believes Fox News, the influence of corporations, their lobbyists and their money on Congress and state governments, the Republican Congress of 1994, et cetera, et cetera, et cetera.

    It was a gradual takeover of our country by those who would concentrate all our wealth at the top and sacrifice our economy (millions of jobs sent to low-wage third world countries while American workers go without) and our democracy (as well as the natural resources and workers of all our “free” trade partners) to corporate wishes.

    Without huge resistance like that we saw in Madison, we will soon be a corporatist state in which the interests of government and business are one and the same. Oh, wait ….

  12. Submitted by Jeff Hamilton on 04/23/2011 - 11:50 am.

    Many of the comments are dead-on, however most government entities were serendipitous beneficiaries of the 1990’s consumer spending spree.

  13. Submitted by Mike Naas on 04/24/2011 - 12:31 pm.

    Most people understand that Monday morning quarterbacking comments and criticisms hold little value and are rarely regarded as insightful or helpful. Arne Carlson’s Monday morning quarterbacking falls into this same category. Here we have a 2nd term Representative from Edina that is in office and wants to solve our budget problem now. I applaud the attitude and intentions of this Edina Representative. None of these comments by Carlson is helpful in any way. It might be helpful if Carlson would run for office again, or submit a very specific and detailed budget proposal to his representatives for thoughtful considerations. Minnesota (and the Nation too) need bold moves by bold and empowered politicians who are in office now. We (I include myself, because I’m a voter) have built a bloated Minnesota government that we cannot afford. We need to cut Minnesota’s Government down to size without creating the highest tax rates in the US or the World. I applaud any politician, in any party, who will make the bold moves needed to accomplish this necessary task of cutting the size of government at every level. All of us voters, including Carlson, should divert criticisms to those who are in office now, and NOT working to cut the size of government to our level of income. Any Minnesota politician who wants to see who is responsible to create our badly needed solution can simply look into a mirror to identify a responsible party. No excuses get it done.

  14. Submitted by Dave Seitz on 04/24/2011 - 06:59 pm.

    Arne has a serious axe to grind with T Paw and every Republican nation wide. If you didn’t know he has been kicked out of the party for 2 years. He is banned from events and his phone calls are not welcomed anywhere. He can call himself a former Republican and that is as far as it can go.

    So why does Doug Grow waste time with this nonsense that Arne spouts? Doug if you need ideas for articals give me a call you are looking desperate. This is a non story did you not know that?

  15. Submitted by Everett Flynn on 04/26/2011 - 12:40 pm.

    Great article and interesting comments. But I want to mention that this train wreck legislature didn’t just appear out of nowhere. For all the political wisdom and decency of Gov. Carlson, and for all the deserved criticism of Pawlenty, there’s another very real part to our situation. I mean, who can deny that these current Republicans have been winning elections? Pawlenty won elections. They successfully pandered to us all with tax rebates, tax cuts, and robotic parroting of “no new taxes,” and “we don’t have a revenue problem, we have a spending problem,” sufficiently to win the governorship twice for Pawlenty and now they control the legislature.

    If you ask me, we, the citizens of Minnesota are to blame for the depth of the hole in which we find ourselves for the simple fact that we keep rewarding those who are doing all of the digging. We have to change the tone of these debates. It can no longer be ok to budget irresponsibly, to cheat K-12 schools. It can no longer be ok to pocket meager tax cuts and abandon our responsibilities to our own infrastructure, our colleges and universities, after so many have done so much to build up these elements of our successful state. It can no longer be ok to sit back and watch what has been built by so much sacrifice of those before us being dismantled in favor of low taxes for the wealthy. We can no longer acquiesce to being sold out so very cheaply. But if we don’t change the tenor of conversations of public b business, Republicans will keep doing what they have been doing and they will keep winning elections.

    How sad is it that their own elder statesman, Carlson, calls them out on how shallow and flimsy are their policies, how irresponsible their governing, and yet the citizens of this state keep electing them….? We can’t blame Pawlenty for everything, although I’m certainly fond of doing so. Let’s start blaming the people being played for fools — the ones who keep voting for and electing Pawlenty and his ilk.

  16. Submitted by Mitch Berg on 07/03/2011 - 01:51 am.

    What Dave Seitz said.

    Carlson is grinding axes – with the willing connivance of Doug Grow.

    And Carlson is the father of our budget mess. When he governed, during the cha-cha nineties, when the Minnesota economy was whirring along on “puree”, he turned every “surplus” bit of revenue into permanent entitlement spending. The budget zoomed on his watch. His eight years were a DFL-worthy orgy of spending. His bitter sour grapes aside, he is NOBODY to comment about fiscal responsibility, much less the GOP.

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