Analysis: ‘Jobs session’ ends with job undone

Published 10:25 am Sunday, May 29, 2011

By Martiga Lohn, Associated Press

ST. PAUL — The 2011 legislative session was supposed to be all about jobs.

Instead, state leaders let it end with the main job undone — setting a budget to pay for state government for the next two years.

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Now, Minnesota’s government might shut down in July, locking tens of thousands of public employees out of their jobs and suspending services many others rely on, from state parks to social workers. A $5 billion deficit remains unaddressed for the coming budget cycle.

The unfinished business is no surprise since voters gave Minnesota politics a split personality in the last election.

They hired Mark Dayton to be the first Democratic governor in 20 years after he campaigned for two years to raise taxes on the wealthy. Republicans got the job of running the entire Legislature for the first time in 38 years on a platform of holding down government spending.

The fight pitting “Tax the rich” against “Live within our means” ended in a draw this past week when the Legislature hit a mandatory adjournment deadline and went home. The Republican-backed budget that Dayton vetoed the next day would have eliminated more than 11,000 state jobs, by the governor’s reckoning. Dayton dinged the Republicans for going against their emphasis on creating jobs.

“They’re 11,000 behind,” he said. “It’s like one of my diets where I start out wanting to lose 10 pounds and after a week of progress I have 15 pounds to lose.”

Republicans paint Dayton as holding onto the old way of doing business — seeking money to sustain government at the expense of the private sector. Their mantra: His plan to raise the income taxes paid by the top 2 percent will cost jobs by causing business owners to leave the state and entrepreneurs to locate their start-ups elsewhere.

They say their resistance to tax increases is based on economic realities.

Rep. Keith Downey, a management consultant who helps companies cut costs and wants a 15 percent reduction in the state workforce, said businesses want to see government run more like they do. The Edina Republican said the GOP is heeding their message: “Get your house in order, don’t raise taxes and let’s see that Minnesota is going to focus on improving its business climate.”

The short list of joint legislative-gubernatorial achievements this year includes a new law designed to streamline the environmental permit application process for businesses — a move both sides hope will spur new hiring.

Democrats defend Dayton’s quest for new tax dollars by arguing that deep government cuts will hurt the economy by pushing up property taxes, carving up social supports and leading to layoffs at multiple levels of government.

Unionized state employees are some of Dayton’s strongest supporters, and their leaders say they won’t waver even if they have to endure the financial pain of a shutdown. 44

“Our members know who to blame,” said Eliot Seide, who represents 18,000 state workers as head of the American Federation of State, County and Municipal Employees Council 5. “They know that asking the governor to cave to the extremist cuts of the Republican majority would mean a return to work — only to get laid off by budget cuts.”

At least a handful of Republican lawmakers are willing to entertain more spending, as long as the money doesn’t come from taxes.

GOP Rep. John Kriesel and Sen. Doug Magnus both said they could envision new gambling dollars as part of a budget deal. Magnus speculated that a compromise ultimately might also include revenue from eliminating tax breaks and increasing a payment delay to schools.

Magnus shepherded the only piece of the budget Dayton signed into law so far, a $76 million farm bill. The Slayton farmer said he could see the standoff coming early on. His bill’s passage ensures that more than 500 workers at the Department of Agriculture and Board of Animal Health — less than 2 percent of the state work force — will stay on the job even if the rest of government shuts down.

“I did not want to get caught up in the end game here,” Magnus said.

Kriesel, one of the GOP’s big new group of freshmen, hopes it won’t come to a shutdown.

“There’s a lot of state employees that would hurt and it’s not right to punish them for our inability to work things out,” he said.

Despite the emphasis on jobs, the Republican-controlled Legislature’s highest-profile action so far was approving a statewide vote to ban gay marriage in the state constitution.

It didn’t have anything to do with the budget, but should boost a small sector of the economy. A multimillion-dollar campaign is expected, which should keep political consultants and ad gurus on both sides in paychecks until November 2012.

Martiga Lohn has covered Minnesota government and politics for the AP since 2004.