REBECCA'S HISTORIC

BI-PARTISAN BUDGET FORUM

We all know by now that “no new taxes” was a myth – taxes and fees are up all over the place, we’re still in a budget deficit for the fourth straight year, and meanwhile schools are cutting, local governments are cutting; in fact key services are being cut all over. What’s going on!?

The White Bear Area Chamber of Commerce wondered just that, and they sponsored this bi-partisan forum on Jan 8, 2004.  Organized and moderated by Rebecca and hosted by Century College, the forum featured Republican finance commissioner John Gunyou (Carlson administration) and Democrat finance commissioner Jay Kiedrowski (Perpich Administration). Gunyou and Kiedrowski faced similar budget shortfalls and solved them without the kind of radical approaches we’ve seen lately.  Rebecca was the first to bring them together in a bipartisan manner, and this was the event.

Former Republican MN Governor Arne Carlson also attended and spoke briefly. Like many moderate Republicans, Governor Carlson has become an outspoken supporter of Rebecca in recent months. He spoke and said that under his watch and prior watches, department employees had an obligation to be "one hundred percent truthful"  and politics were left to him to worry about. Now, he says, this has changed, and it is not good for our state.  Watch his comments on video here.

Highlights:

Commissioner Gunyou said he would recommend people don’t believe a single thing they hear from the Taxpayer’s League, and that he hasn’t heard them say a single truthful thing since they began. He recommended the non-partisan tax watchdog group MN Taxpayer’s Association for less slanted talk about taxes.  An essay summarizing his presentation is here.

Commissioner Kiedrowski defined what it means to be fiscally conservative. Among parts of his definition: pay cash instead of borrowing for ongoing expenses like groceries (or at the state level, roads), and protect your credit rating so your borrowing costs are as cheap as possible. He said the current administration’s fiscal management is a “enjoy it now, to hell with the future” approach that violates the principles of fiscal conservatism, and gave several examples, among them the state’s bonding for two year’s worth of road expenses and financing them over 20 years to avoid saying they were raising taxes.

Both commissioners criticized the so-called “Taxpayer Bill of Rights,” an amendment that would constitutionally restrict tax increases. Both said that making spending and taxing decisions are what we have representative government for.

Both cautioned that the budget problems have not been solved and both expect to see as much as $1 billion in budget shortfalls in the coming biennium, which will require tax increases or more cuts.  They subsequently co-wrote an editorial on the subject that appeared in the March 15 StarTribune.  The editorial prompted legislators of three parties to join Rebecca in calling for hearings on our budget process, with the goal of implementing a more fiscally responsible, honest and balanced approach to solve our recurring budget shortfalls.

Read the letter and see its signers here.  Watch the senate hearing on video here.  Watch the budget forum on video here.

Both showed that tax cuts, not increased spending, were behind much of the deficit, and that once you accounted for the take-over of school spending off the property tax rolls and a few other accounting shifts, state spending did not increase at all.  In fact, the official "Price of Government" index (government spending as a percent of personal income) has declined substantially over the last decade.  Download recent POG Index charts here (pdf - 48k).

Both commissioners complimented former finance commissioner Pam Wheelock (Ventura administration) for several controls she put in place, which have since been discarded, and spoke of how both Labor and the Chamber have made and continue to make important contributions to our state.

Several attendees remarked on how refreshing it was to have a straight-talking environment in which to discuss state finances, ask questions and get honest answers without feeling partisan rhetoric controlling the debate.