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Legislative News and Views - Rep. Steve Drazkowski (R)

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Tuesday, March 9, 2010
Eliminating our projected budget deficit got a bit easier recently, as state economists say our shortfall has shrunk from $1.2 billion to $994 million. But while there is a deficit decrease for the current year, we were also notified that we have a major long term problem on our hands. The Fiscal Year 2012-13 budget shows a $5.8 billion deficit projection. The budget forecast shows that 77 percent of the budget deficit is due to a decline in personal income taxes resulting from people losing jobs and taking pay cuts. Individual income tax receipts are now forecast to be $874 million less than end-of-session estimates. Therefore, the economic message we’re hearing is that government spending continues to grow faster that it can collect revenue. We’re spending $2 million per day more than we’re taking in. Projections show that Minnesota can expect to collect an additional $2.9 billion in revenue in the next biennium, and without spending reform, it can expect to spend $7.6 billion more during that period than during the current biennium. Right now, lawmakers must start looking at reform ideas that put next biennium’s budget into balance. We haven’t done that yet. Our Democratic legislative leaders have not yet crafted a balanced budget plan and history tends to cast doubt on their ability to bring forward the budget cuts needed to bring spending into structural balance with revenue. Somehow, we need to institute policies that will turn this disturbing trend around so expenditures equal incoming revenues. One way to do this would be to approve a Constitutional amendment proposal that’s been introduced and is supported by Governor Pawlenty. Under the bill, if the voters agreed to it, state government would only be allowed to spend up to the amount it had collected in the previous year. For Minnesota families struggling to make ends meet, this familiar practice makes a great deal of common sense. This would ensure that we don’t have massive budget deficits and ridiculous state spending increases from biennium to biennium. And it would also end the liberal idea that we have to raise taxes every year to keep pace with out-of-control state government growth. Democrats are already sponsoring proposals that would once again raise your taxes in order to eliminate this current deficit. Just imagine what we’ll see next year if they’re still in charge. In this poor economic climate, raising taxes should not be an option. A significant section of the Minnesota workforce currently does not have a job. Others are working fewer hours at reduced wages. Family incomes have dropped over 5 percent. These folks simply can’t pay more to state government, nor should they. Our latest economic forecast shows once again that Minnesota has a spending problem, and it’s time we get this problem under control.
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