While Minnesota families sit down at their kitchen table and try to figure out just how they’re going to pay the bills in today’s economic climate, there’s one thing they cannot afford to see: new tax bills from the state government.
Governor Pawlenty discussed the realities that face Minnesotans at their kitchen table during his most recent State of the State Address, and while he outlined several bold initiatives, he made one simple plea to the Legislature on behalf of all Minnesotans.
Please don’t raise their taxes.
The tax message was directed to Democratic leaders in the House and Senate. To date, they have refused to eliminate tax increases as part of the budget balancing solution.
Interestingly, when it came to business taxes, the Governor is actually in favor of lowering them. As part of his Minnesota Jobs Recovery Act, Pawlenty wants to reduce the current 9.8 percent business tax rate to 4.8 percent over the next six years in order to help Minnesota attract new jobs - and maybe more importantly, to keep the remaining jobs that Minnesota’s families have.
The Governor knows we can solve this budget problem now and in the future by putting more people to work. More people with jobs means more people are paying income taxes, and are paying sales taxes on goods in the marketplace.
He also realizes that state spending reforms also have to be a significant part of the budget solution.
Minnesota currently spends $34 billion from its general fund every two years on state government programs, while the total biennial budget is nearly $60 billion. Tax revenues are projected to fall short for that period’s general fund budget by about $5 billion. This means state spending habits must change. Families who have $500 worth of bills remaining on their kitchen table at the end of the month are forced to make drastic spending changes. Why shouldn’t state government act in the same fashion?
Some areas of our budget are also growing at an alarming rate. Governor Pawlenty noted in his address that health and human services make up the second largest part of our budget, and that Minnesota’s programs in this area have become unreasonably expensive. In fact, our latest budget forecast shows that these programs will rise by nearly 19 percent if we do nothing this session.
What does that mean - if we don’t act on the out of control health and human services budget? Less money for our schools; less money for law enforcement; less money for everything state government funds.
In my opinion, the continued growth in overall state government spending - ten percent last biennium alone - is unsustainable. And I believe it’s unreasonable for our Democrat-led House and Senate leadership to place yet another big bill on the kitchen table of Minnesota families - in order to satisfy their insatiable appetite to increase spending.
If you were to compare the condition of state government spending to the condition of an obese man, you’d correctly suggest both may be in need of a gastric bypass. Both need to stop bellying up to the kitchen table and asking for more to be put on their plates. It’s time for us to recognize that both are way too fat.