Friends and neighbors –
The latest projections from Minnesota’s office of Management and Budget peg Minnesota’s current budget surplus at about $2.4 billion. On its face, this seems like good news. Unfortunately, you do not need to dig very deep to be concerned.
That is because the report also projected a looming budget deficit of $2.31 billion for the following budget cycle. In other words, Democrats and Gov. Walz took a historic $19 billion surplus and, in budget cycle, turned it into a budget deficit.
How did they do that? With reckless, unsustainable spending.
As I said, in February Minnesota had a $19 billion budget surplus. Instead of exercising any caution, Democrats chose to spend the entire thing. But $19 billion wasn’t even enough, so they also raised taxes on hardworking Minnesotans by more than $9 billion. Tax increases that are especially harmful to working families and low-income families, like the gas tax, license tab fees, and sales taxes.
After all was said and done, they increased government spending by a eye-popping 40%.
Meanwhile, Minnesotans continue to struggle with inflation that has driven up the cost of everything from groceries to energy to used cars. It is good news that inflation is slowing a bit but daily life is still awfully expensive, and it is simply wrong that we squandered an opportunity to use that $19 billion surplus to ease the pressure on working families.
At every step of the way, many of us urged them to slow down. To think about what they were doing. To consider the consequences of their actions. Our concerns were ignored, dismissed, or shutdown.
We presented reasonable alternatives. We proposed giving back the state’s record budget surplus to taxpayers. After all, your hard work is what built the surplus – you deserve it back. We proposed getting rid of the double tax on Social Security benefits. We proposed reducing income taxes to help the lowest earners and middle class Minnesotans.
We offered a plan to invest in education, especially literacy and special education, without the burdensome mandates that are putting many schools in financial trouble. We proposed an energy plan that would be the foundation for reliable, affordable, and “always on” energy planning for the state. We offered a paid family leave program that would expand access to paid leave without costing workers and small businesses billions of dollars.
Democrats were not interested in our ideas. They were not interested in compromise and they were not interested in exercising and caution. Now we are seeing the consequences.
The unsustainable path that began last year cannot continue. Government simply cannot increase spending at a 40% pace and expect nothing bad to happen. Workers cannot afford it, small businesses cannot afford it, and the state cannot afford it.
Our top priority next session must be planning for the looming budget deficit and, hopefully, dialing back some of the recklessness we observed from Democrats in 2023.
We have a responsibility to be good stewards of Minnesota taxpayers’ dollars. It is time to start taking that responsibility seriously.