By Dick Hagen
Back on Jan. 15 I responded via e-mail to Minnesota House Speaker Margaret Kelliher when she invited Minnesotans to share ideas on the $4.8 billion budget deficit the Legislature was facing. My message to Kelliher had just three suggestions: Spend less, spend less, spend less.
Needless to say, she didn’t respond. Now with the Gov. Pawlenty’s recent announcement on his unallotment budget proposal for the next biennium, everyone seems to have an opinion, myself included.
However, reality is reality.
Our state, our economy, our tax-paying citizens are simply in no position to comfortably accept more taxes, of any kind, as the solution. Maybe by 2011 tax increases in certain areas, certain income brackets can and would work. But new taxes today simply don’t wash.
With the growing unemployment in our state (and nation), a stepped-up level of economic activity is unlikely during 2009, and maybe not in 2010. Thus additional tax revenue is also unlikely. So is it not logical that various units of government at all levels tighten their “budget belt” accordingly, much like most families have had to do?
When our farmers sit down with their tax accountants next winter, most will realize that agriculture got squeezed severely this year. After record farm income in successive years of 2007 and 2008, breaking even likely will be the reality of Minnesota agriculture for 2009. So there likely will be a corresponding reduction in tax revenue from Minnesota farmers.
The reality of government allocations for various entities of “public support” — be it Local Government Aid to communities, public schools, state agencies, etc. — is that regardless of budget dollars there never is enough, at least in the eyes of the recipient.
Public education, albeit the most important of all tax allocations, is a prime example. Vital to our future? Absolutely. But have you ever heard a school board, or teacher’s group, or school superintendents say, “Thank you, we now have enough.” That likely never will happen.
So reality keeps telling me: Spend less. Yes, painful, at least for a while. But sometimes a little pain leads to surprisingly intelligent decisions on where and how to lessen the pain. Most people appreciate judgment based on common sense. I think most people today realize that spending less is the only real key to balancing our state budget.
It’s apparent that yearly increases in property taxes don’t work. Minnesota has the unenviable reputation of yearly property tax increases the past decade even exceeding the yearly rate of inflation.
Yes, school boards, county boards, local city councils can and often do request a levy increase to generate higher tax revenue. But the reality is that local property taxes are raised only if local citizens allow it to happen.
So as I said to House Speaker Kelliher back on Jan. 15, “There may be a time for more taxes, but 2009 is not the year.”
Stay tuned. Our state’s economy is a constantly moving target. So predicting when Minnesota will be financially healthy is like predicting when Minnesota farmers will have a state average corn yield of 200 bushels per acre (we did 174 bu./acre in 2006, beating Iowa by 1 bushel).
Both will happen. Tell me when.
Join me on the TRAM
I’ve decided to give the The Ride Across Minnesota a try this year.
This year’s ride, a fund-raiser for multiple sclerosis, starts in Ortonville on July 26 and ends in Welch Village on July 31.
Minnesota bikers (pedal bikes that is) have a goal of almost $1 million. My personal goal is $1,000. So if you would like to contribute, both I and Minnesota MS would be thankful. We tent camp each night, and enjoy the sights, sounds and smells of Minnesota each day.
Send your check payable to Minnesota MS, to me at Dick Hagen, 34522 830th Ave., Olivia, MN 56277. Thanks much. I’ll share highlights in The Land.
