Budget: DFL Hands the Store to Pawlenty

As the Minnesota House and Senate scrambled to complete their budget bills before heading into conference committees to hammer out differences last weekend, there was ample evidence that Governor Tim Pawlenty's no-taxes plan to eliminate the state's $4.2 billion deficit was losing political momentum. In a May 4 Star Tribune Minnesota poll, nearly three out of four Minnesotans favored taxes on cigarettes and high-income earners in conjunction with spending cuts in order to balance the budget. Less than half of those polled supported state spending cuts if it meant an increase in local property taxes, which are almost certain to occur under Pawlenty's budget plan--even after a revolt by rural Republicans forced the Governor to revise his cuts in local government aid. Pawlenty's own approval rating dropped 10 points (to 50 percent) since the public has become better acquainted with the sweeping nature of his proposed spending cuts. And early last week, four former governors, three of them from Pawlenty's Republican Party, harshly criticized efforts to solve the deficit without some form of tax hike.

Yet on Friday evening, the DFL leadership ostentatiously caved in to Pawlenty, agreeing to a budget accord that doesn't raise state taxes. Appearing on public television's Almanac program within hours of the agreement, Senate Majority Leader John Hottinger (DFL-Mankato) said he capitulated because Pawlenty had told him that he would shut down government when the fiscal year ends June 30 rather than budge on his no-taxes pledge.

But there was nothing particularly extraordinary about Pawlenty's hard-line position. It's the sort of gamesmanship that occurs almost every year during late-session negotiations at the capitol. It certainly didn't justify Hottinger's literally ceding control of the Senate by offering to put up three DFL votes to create a Republican majority for passage of budget bills in that body. Obviously, Hottinger and the DFL decided to position themselves for the next election. By letting Pawlenty and the Republicans have their way, Democrats reserved the right to point fingers when the public starts howling over the impact of the spending cuts. But that's no consolation to the thousands of Minnesotans sold out by the DFL's political expediency.

What's particularly galling is that the DFL's cynical strategy was politically unnecessary, if not downright inept, at this point in the process. With the war in Iraq no longer dominating the headlines, the public and the media have only recently turned their focus to the state budget. Hottinger and company could have held out and forced Pawlenty to call a special session, extending the debate and increasing the momentum to mitigate massive spending cuts with at least limited, targeted tax increases. Certainly there is nothing in the current budget accord that the DFL couldn't have secured two or three weeks from now. The so-called concessions from Pawlenty's side were far from onerous. The removal of the "racino" plan for raising revenue proposed by House Republicans was opposed by the Governor and his right-wing supporters from the Taxpayers League and the Minnesota Family Council. The bonding bill is about half of what the DFL had proposed and in any case doesn't affect Pawlenty's overarching plan to forego tax increases.

Neither does the $300 million increase in revenue over Pawlenty's original budget. This "increase," accomplished mostly by cost shifts and accounting measures, amounts to a minuscule fraction of a budget that tops $28 billion. And it has no impact on the real pain and hardship caused by Pawlenty's plan, which will deprive more than 60,000 Minnesotans of health insurance, substantially increase child-care and nursing home fees, cut all manner of assistance to the poor, elderly, and disabled, and force local government to lay off police officers and firefighters or substantially raise property taxes. No wonder Pawlenty praised Hottinger for his "statesmanship" in the budget negotiations.


Over the weekend a spontaneous backlash against the budget agreement got underway at the capitol with demonstrations by state workers, social service advocates, and DFLers unhappy over their leaders' betrayal. Even Hottinger heated up his rhetoric, once the deal was done.

Ironically, squabbling over budgetary details is still likely to provoke an extended session. Hottinger had naively thought that Republicans would reward his capitulation on the tax issue by giving DFLers more of a voice in conference-committee negotiations. Instead, the Republicans have exercised still more muscle to assert their control of the budget process. As Senate Minority Leader Dick Day said on Almanac, "I would hope people now know that we are sailing the ship." Then there is Republican Senator Brian LeClair of Woodbury, for whom the DFL's abject surrender isn't enough. LeClair is threatening to vote against the budget proposal because of the $300 million that has been added, which would deny the Republicans a majority even with the three DFL votes Hottinger has agreed to provide them.

But these complications are merely a cleanup operation, minor battles after the war has been won. Pawlenty's fundamental vision for balancing the budget by drastically cutting state spending and cost-shifting the tax burden to local municipalities is the prevailing reality, even as the public increasingly opposes it. Just wait until the effects actually start to be felt.

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