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.
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.