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TAG | 2015 Minnesota budget surplus



Debunking Daudt – Economy

Kurt DaudtAt the latest economic forecast, Speaker Daudt made claims that Minnesota’s improved economic position “has to do with the fact that balance has been restored in state government.”

As you may remember, U.S. Senator Mitch McConnell was criticized for similar claims that were debunked.

The House DFL released a video highlighting Speaker Daudt’s claims about Minnesota’s growing economy – it can be viewed here.

This is not the only claim that Speaker Daudt has asserted about Minnesota’s economy that does not hold up to the facts.

Speaker Daudt has said over the past year that Minnesota’s economy has “flat-lined” due to the policies put in place by Democrats.

Last Friday Speaker Daudt doubled-down, saying “I think the November forecast represented very clearly that the policies they put in place didn’t help Minnesota families and they didn’t help Minnesota’s economy.”

Speaker Daudt’s economic claims do not hold up to the facts. The budget passed by 2013-14 state legislature went into effect in July 2013. Since then, Minnesota’s economy has steadily improved on several key metrics.

  • Minnesota has added 74,500 jobs since the DFL budget was put in place. Far from a flat line, jobs have been added and our unemployment rate has dropped at a steady pace. (Source: MMB, slide 6).
  • Minnesota’s unemployment rate is 3.6%, the 5th lowest in the country and lowest in Minnesota in 14 years. (Source: DEED)
  • Wages have grown for Minnesotans and stronger wage growth is expected in the future. (Source: MMB Slide 7).

Speaker Daudt’s other claim, “that part of this economic confidence has to do with the fact that balance has been restored in state government” has even less factual basis.

Minnesotans are more optimistic about our economy. In fact, Minnesota has the highest confidence of any state in the nation. This is based on a study by Gallup from January to December of 2014, while Democrats were in control of all branches of state government. (Source: http://www.gallup.com/poll/181514/economic-confidence-index-highest-minn-lowest.aspx).

Minnesota’s economy has been making steady improvements in various economic metrics while the Democrats were in control of state government (unemployment rate, job creation, state revenues, and consumer confidence).

Daudt’s claims that Minnesota’s economy flat-lined while Democrats were in control of state government are false. His claims that Minnesota’s economic confidence is in part due to Republican control of the Minnesota House are even less credible.

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Minnesota’s Budget surplus is $1.9 billion

Minnesota’s State Economist and state budget experts at Minnesota Management and Budget (MMB) announced that over the last three months, the state’s budget surplus has grown substantially – thanks in large part to Minnesota’s strong and growing economy. The state’s total projected surplus to $1.869 billion for the next two years – a stark contrast to the $6.2 billion budget deficit Gov. Dayton inherited when he first took office in January 2011.

Again, we have a budget surplus because more people and working and working at higher wages – 182,000 jobs have been added since 2011 and we have the 5th lowest unemployment rate in the nation – and lower state spending. We do not have a budget surplus because Minnesotan’s are “overtaxed.”

Still, there is a lot more work to do to connect more Minnesotans with good-paying jobs, ensure all Minnesota children receive excellent educations, fix our aging roads and bridges, improve our transit systems, and secure an even brighter future for all Minnesotans. Those are the priorities the Governor is proposing to address this session.

“I propose that we invest our collective good fortune in our collective better future for ourselves, for our children, and for our grandchildren, and for the generations that will follow,” Gov. Dayton said. “Since we may not have the same opportunities in the years ahead, it’s even more important that we do it now.”

The Governor noted that he will release his final supplemental budget proposal in the second week of March, but in the wake of the budget surplus news he unveiled these investments:

Universal pre-K – The Governor’s initial budget proposal included the funding necessary to pay for half of the cost of providing free pre-school for every 4-year-old in Minnesota. Today, the Governor proposed investing additional resources to cover the entire cost of universal pre-K – an investment that would help prepare 31,000 young learners for success in school, narrow the state’s achievement gap and save Minnesota families thousands of dollars in child care costs.

Tuition freezes – Two years ago, Gov. Dayton and the Legislature froze tuition at the University of Minnesota and MnSCU campuses statewide. Today, the Governor proposed to do it again. His proposal would freeze tuition at the University of Minnesota for the next two years. It would freeze tuition at MnSCU for the first year of the biennium, and provide half the funding needed to freeze tuition in the second year – asking MnSCU to make up the other half through administrative savings.

Student grants – In 2013, the Governor and Legislature made a major investment in the State Grant Program, providing more financial aid to help make higher education more affordable for tens of thousands of Minnesota students. Today, the Governor proposed building on that investment, making college still more affordable for even more Minnesota students.

Protecting Children – Last fall, Gov. Dayton convened a Child Protection Task Force, charging the group with providing a set of recommendations that would help protect children in Minnesota from the threat of abuse and neglect. Today, the Governor proposed that the state set aside $50 million to implement the expected recommendations of the Child Protection Task Force.

Republican plan for surplus

While Gov. Dayton proposes to invest the budget surplus in areas that will continue to grow our economy, Speaker of the House Kurt Daudt is looking for one-time payouts and, as noted from the Governor’s office, is overpromising the surplus dollars: 

2015 DFL-GOP Budget Comparison



Sen. Hann Not a Math Guy

DavidHann2013LegPreviewPresser640-300x187In the StarTribune’s Hot Dish blog on January 27, 2015, Senator Hann and Speaker Daudt don’t like Gov. Dayton’s budget.  (They also had no specifics on what they would have done with the budget, but that’s pretty common for these folks.)

They talk about a Jesse Ventura style tax rebate.  Remember that?  What can we expect?

$100 back per household in a “tax rebate”

$400 out of pocket to replace damaged tires, rims and suspension work because the potholes in our roads aren’t fixed.

Doesn’t seem like math that works in your and our favor, does it?

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