Posted under Taxes
After 20 days the end has come to an end, meaning Minnesota’s state government is back in business. The Gopher State’s budget is back to where it started, spending all of $35.8 billion, the largest in state history.
But never fear all you taxaphobics out there no one is going to pay an extra dime in taxes to pay for any of this spending. The Republicans held the line all right. Government is bigger and spends more but taxpayers won’t foot the extra bill. Some borrowing will be done, a delayed payment here, moving payments into this account, all the financial legerdemain a state government needs to show a balanced budget.
But no taxes were raised which is all Republicans really cared about. So they declared victory and on the surface they’re right. They calculated a government shutdown would hurt Democratic constituencies more than Republican so they thought they could hold out until the public employee unions cried uncle and Gov. Mark Dayton would give in. They voted for their budget and held out until Dayton, he of the old Dayton-Hudson Department Store fortune (which is now plowed into Target stores) gave up on his plan to tax people like himself and thus he worked out deal the GOP’s state legislative leaders agreed to which they flogged their rank n’ file, the ones who promised they wouldn’t “spend a penny more” than $34 billion, into line support it. Thus, shutdown over with, government back in business.
When it was out of business, persons got a chance to see what life is like without it and what they found out is that it’s more than just closed state parks and idled road projects and unemployed state employees. It’s bartenders and businesses who can’t get licenses, loggers in state forests thrown out of work and stores who have beer and cigarettes removed from the shelves. Government, no matter what the level, touches a lot of our daily lives, a good deal of it unnoticed until one day it’s not there. Then the people who supposedly hate it get upset when it isn’t there because it inconveniences them.
They also get upset when government costs more than what comes in to pay for it. This is called a deficit, as we all know. Deficits are eliminated by cutting spending and/or by raising revenue. The former was done and latter wasn’t because many Republicans, especially those in their first terms in the legislature, were locked into Grover Norquist’s no-new-taxes pledge. But even Republicans who been around the legislature for a while also took a hard line on taxes after watching veteran colleagues who did vote for tax increase in the past get bounced out of office in GOP primaries and local nominating conventions.
Obviously as a matter of politics one does not wish to sign a blood oath and turn around and break it and wind up like George Bush I. But since Norquist established his pledge back in 1987, government is far bigger and runs bigger and bigger deficits than ever before. Far from “starving the beast” the beast simply goes out to eat on a credit card backed by the Federal Reserve and maintains a credit limit of “whatever you feel comfortable with”. In terms of political branding the pledge may well have been a success. In terms of policy, it’s had absolutely no effect whatsoever if judged by the size and scope of government in 2011.
In 1980 Republicans shifted their economic emphasis from spending to taxes because cutting government spending was a political loser but cutting a man’s taxes, well wouldn’t be in favor of that (Barry Goldwater in 1960′s with Kennedy’s tax cut)? In so doing, not only did this make tax cutting in of itself a magical shibboleth in GOP circles, but it also made impossible to cut the federal government given the way revenue poured in to coffers in good times to fund everything everyone wanted. But in bad times, nothing was ever eliminated, just cut back severely. Indeed, what level of government has been reduced in Minnesota? Nothing! You get the same government only more ineffective because it doesn’t have the money to do its job (as military persons will tell you when start talking about cutting the Pentagon’s budget) and people go back to complaining about ineffective government again. See how this cycle works?
Well, it’s about time to shift the cycle again back to the spending side. Because until people come to a consensus as to what should be funded and what constant dollar levels to be both effective and keep up with inflation, and changing the way revenue is raised to better facilitate economic growth, we will continuously go through these shutdowns and debt ceiling debates which are all about finding the way keeping the machine rolling forward until the cliff has been cleared. Taxes may not have been raised in Minnesota, but Minnesota will be paying for the same government which will only get bigger when times are flush again, pledge or no pledge. When it comes to the issue of the role and size government, taxes are utterly irrelevant because all they determine is how your going to pay for government you say you don’t want except for the stuff you like, the stuff which benefits you like student loans, small business loans, farm subsidies, your job at the military base, a new freeway spur, a new navigation channel, grants for the local university and on an on and on. No wonder Ron Paul voted against (Michele Bachmann too) his own party’s budget in the House of Representatives the other day because the budget doesn’t address this fundamental question and once again kick’s the can down the road as lawmakers just did in Minnesota.
Tell me what’s so conservative about promising you won’t pay for what you spend?