Minnesota Report

In the 2000s, first during the Governor Jesse Ventura (IP-MN) when Rep Tim Pawlenty (R-MN) was House Majority Leader, Republicans began looking at government in a unique way. This was the 2003-04 Buget. They only acknowledged inflation on the revenue side of the budgetary formula, but not on the spending side. This they argued put government on “autopilot” and prevented any curtailing of government spending. This is akin to a zero-based budgeting model, which puts every expenditure at zero and then forces the advocates to argue in favor of a spending figure they need without establishing the baseline of the previous year’s expenditure as the starting figure.

DFLers, on the other hand, support the existing programs and cede the previous expenditure as the baseline and any action short of an inflationary increase is deemed to be a cut and any amount over that figure to be an increase in funding. Additionally, DFLers want to stabilize the funding sources to enable there to be an adequate future funding source.

This differential in approaches for viewing figures are the crux of where the debate over the funding for the 2020-21 Budget start. The problem is it is effectively an apple to oranges conversation. Sure, both sides acknowledge they are talking about fruit but that is where the similarities end.

It appears the question rests on the issue of duration. DFLers want to create a system that is sustainable over a timeframe greater than a biennial budget and Republicans want to address the current situation and witness the result of the 2020 election and see where things stand afterward. It is a long-term versus short-term approach. Republicans need to stand strong in order to have their fundamental argument of being the only advocates for reining in spending and painting the DFL in a trite/traditional manner as tax and spend liberals.

Republicans are hostile to untethered governmental spending, where the scrutiny of what is being spent isn’t placed under a microscope and areas of spending found deficient are eliminated. The reduction in overall spending is what is seen as a success by the GOP, so it makes sense to give them some type of victory they can tout. The elimination or consolidation of some programs or expenditures would be a major bargaining chip.

In our conversation with Senate Majority Leader Paul Gazelka (R-09, Nisswa) after Governor Tim Walz’ State of the State Address, we found his response to our question regarding their approach being a hard no on tax increases, of “Well, our first budget has no tax increases…” to be potentially beneficial to the forthcoming discussions.

Since the two sides are made up of Walz and House Speaker Melissa Hortman (DFL-36B, Brooklyn Park) against Gazelka, which he also acknowledged in our post State of the State interview, then he will be in the position of either defending or blocking. If each position he advocates is seen as negative there will be little progress, but then the question is does he warrant one-third of the calculation when he can obstruct the entirety?

We believe people of strong conviction often see compromise as capitulation rather than a robust exercise in forming an agreement. The more extreme the ideological view the more intractable and hence the less willing to move. We will again posit our position on the best negotiation is where both sides a mutual dissatisfied rather than mutually satisfied because then each side is able to argue they fought for what they could get and live to fight another day.