Governor Mark Dayton is now meeting with top Republican leaders after what he terms a five-day “cooling-off” period. The one-hour meeting Tuesday afternoon was little more than an effort to restart budget negotiations.
The effort produced little more than an agreement for three more meetings. Everyone recognizes there are a few elephants in the room but no one is talking about them yet.
Education and health care funding remain the two largest obstacles standing in the way of an agreement. One item that seems to be off the table is Dayton’s plan to increase the state’s income tax.
“Every time I suggest it, even on millionaires…it’s soundly rejected by the Republicans,” Dayton acknowledged in an earlier statement to reporters. “They’ve got control of the legislature. If they’re not going to support something, then I cannot single-handedly get it passed.”
Republicans control both chambers and are urging the governor to call a special session for the legislature to pass a temporary spending measure that would reopen the government and pass five or six individual funding bills.
Speaker Majority Leader Amy Koch (R-Buffalo) was adamant the budget must tackle what she calls “unsustainable,” double-digit growth of health-care spending. She recommends both spending cuts and increasing the efficiency of programs as a way to address some budget issues.
But before Dayton gives in to Republican demands, he’s trying to pick off moderate Republicans to support his proposals. He was unwilling to share names of potential votes.
However, Dayton’s strategy of not allowing Republicans to pass a spending measure is only adding to the increased cost of a government shutdown. While the state is saving money by not paying employees, 22,000 laid-off state workers are trying to collect unemployment benefits, $1.25 million in lottery tickets are not being sold and $1 million a week in camping fees won’t be collected.
On top of everything else, Minnesota is still dealing with the effects of a slow-moving economy.
“It’s going to be a slow force on the economy,” said University of Minnesota economist Tom Stinson to Forbes. “But it’s not going to be something that would create a recession or anything like that in Minnesota. It’s clearly not good the longer that it goes on.”
Stinson estimated a shutdown lasting longer than a month would cost approximately $20 million per week when state expenditures and consumer spending are taken into consideration.
Unlike some state employees, not everyone is upset about the shutdown.
“Government needs to get smaller and maybe this will help us do that,” said Bob Steinfeld, a retired accountant from outside Duluth. “Minnesota is a great state but we’re spending too much and wanting to tax those who are the most successful. No one has ever taxed their way to success, ever.”
The latest shots fired in this debate have come from former Vice President and Minnesota native Walter Mondale who is blaming former Republican Governor Tim Pawlenty for the state’s budget woes.
In a statement issued from his campaign, Pawlenty wasted no time in responding to Mondale’s attacks.
“Walter Mondale ran for president against Ronald Regan on a platform that called for higher taxes,” said Pawlenty. “We did it the right way for the last eight years, with dramatically lower spending and tax cuts. I commend the Republicans in the Legislature for sticking to their guns, even when politicians of the past call for old-fashioned high tax and spend solutions.”