Sunday, July 3, 2011

Minnesota Shutown Is An Historic Oportunity

Most Minnesotans know by now that their state government has been shut down because the state cannot pay its bills. It is also a national news story, and many persons across the nation are looking to see how Minnesota will resolve it budget impasse.

An impasse it is because the Democratic (here called the Democratic-Farmer-Labor Party or DFL) governor is adamant so far about raising additional revenue to pay for state programs by placing an additional tax on rich Minnesotans. At the same time, the Republican controlled legislature is insisting there be no new taxes while limiting new spending. It is the classic political/economic confrontation of contemporary America, and the same scenario is being played out in other financially-overdrawn states as well as in a similar confrontation in Washington, DC where a Democratic president and Democratically-controlled U.S. senate is at basic odds with a Republican-controlled U.S. house of representatives.

In some states with these problems, the governorship and the legislature have been of like mind, and an historic transformation has begun to take place. Most far-reaching of these is perhaps Ohio where former congressman John Kasich is the new governor. He has turned the state completely around with conservative policies that cut back state spending, reduced the size of Ohio stated government, and levied no new taxes. Kasich, a Republican, was a leader for advancing these principles when he was in Congress, but they are not necessarily partisan. Others such as former Democratic Congressman Tim Penny worked closely with Kasich in those congressional days, and remains a friend and confidante. Penny failed to win the Minnesota governorship in 2002, and an historic opportunity for that state was thus lost. The man who beat Penny, conservative Republican Tim Pawlenty, did try to transform the state’s economic policy, but he lacked control of the state legislature, and was unable to initiate much true reform, other than block new taxation.

The new governor of Minnesota is the very liberal Mark Dayton who ran on a platform of increasing the income taxes of rich Minnesotans. Dayton had been a presence in Minnesota politics since the early 1980s when he served as a commissioner for DFL Governor Rudy Perpich and then ran unsuccessfully for the US. senate. He subsequently ran for and won the post of state auditor for one term. After a failed bid for governor in the 1990s, he re-emerged to stage an upset win in the 2000 DFL U.S. senate primary, defeating the DFL-endorsed candidate, and went on to win the senate seat. He also served one term, but retired in 2006. In 2010, Dayton again re-emerged to challenge the DFL-endorsed candidate for governor. He won the primary, and went on to win the state’s top executive position by the narrowest of margins, and like his predecessor Tim Pawlenty, gathered only a plurality of votes.

Dayton is an heir to the state’s fabled department store fortune, and grew up in privileged circumstances. Not unlike many other rich Democratic politicians in his circumstances, he adopted the populist position of seeking to tax the rich, as if to make credible his claim to be an ordinary Democratic person. While he served well as a state commissioner and state auditor, he was clearly not comfortable as a U.S, senator in Washington, DC. His retirement forestalled probable defeat at the polls in 2006. His most notorious moment in that job was when he closed his office in the Capitol following a health scare. (Although he was ridiculed for this, I wrote then in a Washington daily newspaper defending his action, saying while it was a political mistake, his motivation was the welfare of those who worked for him, and he did not deserve all the opprobrium he was receiving.)

I do not share some of Dayton’s political philosophy, and certainly disagree with his populist rant about “taxing the rich,” But I have observed that his long political career in Minnesota has not been without personal integrity and notable political accomplishments. The latter includes coming back against all odds in 2000 and 2010 to win high office, and defeating party-endorsed DFL candidates. I have long opposed the so-called precinct caucus system in Minnesota as undemocratic and elitist, and Dayton has almost single-handedly rendered it impotent.

But now, Mark Dayton is at a new crossroads in his political career, and clearly the most important one, perhaps the most important he will ever face. As the surprise winner of the 2010 Minnesota governorship, while the DFL equally surprisingly lost control of both houses of the state legislature, and the first DFL governor in 20 years, Dayton is in a unique position to resolve the budget impasse in Minnesota. The DFL needs him far more than he needs the DFL, and he could fashion an historic resolution to the state government shutdown. In my opinion, it is time for Dayton to shed his atavistic and discredited mantra about “taxing the rich.” Nowhere in the U.S. is this policy working. I don’t think that Dayton’s life experience as a “rich kid” needs any longer to be compensated for by him. He has paid his dues over 30 years. He has shown himself to be compassionate and progressive.

The way out of the current Minnesota shutdown impasse is for a true compromise. A true compromise is not “splitting the difference” between the DFL and GOP positions. It is not meeting “half way.” That would rightly be perceived as as a one-sided victory for the DFL since it would raise taxes. Raising taxes is off the table in 2011, as is increased state pending and expanding state regulations and government. The voters decided that in 2010, and even more powerfully, economic circumstances in the state and nation, preclude it. In my opinion, Governor Dayton should go beyond the tax issue, accept new governmental discipline, and demand as his side of the bargain the preservation of certain progressive and DFL-favored institutions and programs. He may worry that he would be criticized in his DFL political base for conceding the tax issue, but as I have previously pointed out, the DFL political base needs Mark Dayton much more than he needs them.

I would also argue that if he does not do this, and get the credit for statesmanship, he will have to do it in the end anyway, and not get any credit. The GOP leaders of the legislature, and its members, would be committing political suicide to agree to any tax increase. And, as I pointed out, they won the election running on a no-new-taxes platform, while Dayton, I would argue, did not win because he said he would tax the rich, but in spite of that. (His Republican conservative opponent was discredited early in the 2010 campaign, and ran well behind GOP legislative candidates.)

Not only Ohio shows the way for state government today. Governor Mitch Daniels of Indiana, Governor Chris Christie of New Jersey, Governor Bob McConnell of Virginia, Governor Rick Scott of Florida are leading similar movements in their states. Yes, they are Republicans, but believe it or not, conservative measures are also being adopted by such Democratic governors Andrew Cuomo of New York and Jerry Brown of California. Doing the right and successful thing is NOT necessarily a partisan matter in these difficult economic times.

The onus for resolving the Minnesota shutdown is not primarily on the Republican conservative legislature. The real responsibility, as it usually is, is with the state governor. Mark Dayton is at his biggest crossroads. Let’s see if he rises to the occasion.

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