Wednesday, June 29, 2011

Minnesota’s Budget Battle: Assessing Gearin’s Decision

“It’s time you did your job.” Essentially this is what Judge Gearin stated today in her ruling that only core functions will receive core mandated funding. In reaching that decision she took a minimal view of the role of the courts in resolving the budget dispute, clearly placing the responsibility on the governor and the Republican legislative leadership to reach agreement. But how do we read Gearin’s order, as well as the one yesterday, ordering funding for the state court system, in terms of what it means for Minnesota and the different players in budget battle?

Comparing 2005 and 2011

In 2005, seven of the budget bills did pass the legislature and were signed by the governor. They excluded K-12, Health and Human Services (HHS), and transportation. Those three bills accounted for about 70-75% of the state budget. Thus, the seven bills that passed before the shutdown accounted for about 25-30% of the state budget. Once you throw in the judge's order for temporary funding you probably had 90% of the state budget addressed. For the most part most of the functions of the state were covered.

This year one of ten bills was passed and signed into law. The one bill signed in to law, the agriculture bill, accounts for about 1/2 of 1% of the state budget. Thus, 99%+ of the budget was not adopted or agreed to by the governor and legislature. As of yesterday with the court decision to fund the courts, approximately another 3-4% of the state budget is addressed. This still leaves about 95% not covered.

Judge Gearin’s decision is minimal. It covers core state constitutional functions, programs mandated by federal law, and some additional funding for health care and to keep the animals at the zoo fed and safe. Additionally, funding to school districts and local governments, to the extent already obligated, must be paid. Gearin’s order is largely consistent with what I argued in a Minnpost piece from June 9, 2011 .

Given Gearin’s order, what percentage of the state budget will be addressed by it? It is difficult to ascertain from the order how much of K-12 gets funded. The same is true regarding the state HHS funding. These are the two largest pieces of the budget and constitute about 70% of the budget. Estimates are 80% of K-12 are covered. If K-12 is 40% of the state budget then about 32% of the budget is covered here. In terms of Health and Human Services, assume also about 3/4 covered. If HHS is 30% of the state budget then that is about 23% of the state budget. Add in local government aid (LGA) which is about 9% of the state budget. Most of that is covered by Gearin's order. Assume 90% is covered and that is another 8% of the budget. Finally add to that funding for core administration of the executive branch and public safety about another 7%. In total Gearin's order mandates funding for about 70% of the state budget., Add to that the current 5% covered already with the agriculture bill and the funding for the courts, then maybe 75% of the state budget has been addressed.

The Gearin order also suggests that most of the 36,000 state workers are out of work on July 1. An estimate is 23,000 lose their jobs. The real issue becomes how many state workers are needed to work the prisons, provide medical care, and perform core public safety and other functions. No question the Minnesota unemployment rate takes a major hit and goes up dramatically on July 1.

Legal Analysis

There were legal winners and losers in the Gearin decision, as well as in the Tuesday one on court funding issued by Judge Christopherson.

Governor Dayton appears to be a legal winner in that Gearin sided with him on a minimalist interpretation of what will be funded. However, Dayton did not win everything. He did not win the mediation and he also did not win in his argument that the case was not ripe for review and that the court should not issue an order. The Court implicitly rejected Dayton’s argument that he had inherent executive authority to act and therefore the Court should not.

Conversely, Attorney General Swanson and many organizations seeking to have their definition of core state function funded lost. Horse racing, continuing construction projects, and keeping zoos open, while nice, are not essential. Gearin offered reasonable legal arguments, seeking to balance Article XI of the Minnesota Constitution (No money shall be paid out of the treasury of this state except in pursuance of an appropriation by law”) with the Federal Constitution’s Supremacy clause with Article III of the Minnesota Constitution (separation of powers). Essentially she said yes, appropriates and the budget need to be handled by the legislature and the governor as required by Articles III and XI, but these clauses must also be read in light of the requirements of the Supremacy Clause and separation of powers so as not to threaten the constitutional duties of the executive branch. While Swanson made good legal arguments, Gearin construed her powers narrowly in order to respect the powers of the other branches.

The House and Senate Republicans lost legally similarly to the Attorney General. Yet the biggest losers were the four Republican senators who argued first to have the court order the governor to call a special session and then to declare that Article XI precludes any judicial orders to maintain temporary funding. The core of their argument was a wooden reading of Article XI that seemed to assume only the legislature can order funding “by law.” Gearin rejected that argument by appealing to the Supremacy clause and by asserting that respect for separation of powers required and permitted court action.

Judge Christopherson also rejected this reading of Article XI. He too appealed to the U.S. Constitution and the State Constitution to make his claims. But also in a section of his decision entitled “reconciliation” he contended that this clause has to be read in light of other clauses of the State Constitution and not as stand alone. It was necessary to do that to give meaning to the entire Minnesota Constitution and not just part of it. More or less, this was again the argument I made in my Minnpost piece. In short, the a core legal argument that Republicans have been using in battles or court-ordered funding for abortion and in other budget battles, was rejected.

Last Thoughts: Political Winners and Losers

Simple: Dayton wins the political-legal battle and has a strategic advantage over the Republican legislature. Dayton has new leverage to use in negotiations, with voter ire taken out in 2012.
Of course, Minnesotans lose here. A second shutdown in six years, a loss of services, and embarrassment nationally as a state that cannot get its work done.

Friday, June 24, 2011

Constitutional Chicken: Litigating the Minnesota Shutdown

As kids we played chicken all the time, daring someone to do x or cross over a line. The same game of chicken is being played now with the Minnesota budget and economy. First it was between the Governor and the Republican legislature during session, now in Court and the participants have expanded to include the Attorney General, interest groups, and the courts themselves.

At Thursday’s hearing in Ramsey County (which I attended) Judge Gearin closed the day by indicating that all of the sides were playing chicken with the state. And numerous times she admonished that the stakes were high, the problems serious, and that no one should expect her to bail them out. In many ways, her threat too was one of chicken. Do not expect her to blink. See my first thoughts on the court proceeding on Fox 9 News from Thursday, June 24, 2011.

The Stakes
There are numerous agendas at play here. Of course, there is the agenda to secure a budget by July 1, to avert a shutdown. There is also a broader agenda between contending and philosophical views on state spending and what role we view for the government in our society. But there are also significant other economic, political, and legal or separation of powers issues here.

The economic stakes are significant. I discuss them on Kare 11 News on Thursday, June 23, 2011.

According to the Bureau of Labor Statistics the May unemployment rate in Minnesota was 6.6%. This is based on a state workforce of 2,977,400, with total employed being 2,781,000 and unemployed 196,300. Assume all 36,000 state workers given notice are furloughed. Using the May figures, this pushes the total unemployed to 233,300, yielding an unemployment rate of 7.8%. The economic consequences of the shutdown are apparent–nearly a 20% increase in the unemployment rate almost immediately.

Laying off state workers and cutting state services is only the beginning. There is also the multiplier effect. By that, for every dollar of state spending, it produces more down the line. Paying public employees means they will additionally purchase food or consume items, thereby resulting in more spending across the economy. Now some market fundamentalists claim the government adds no value and produces no multiplier. Yet they are often the same ones who claim that tax cuts for the wealthy trickle down to the poor.

Mainstream economists who have studied government spending verify that multiplier effects exist. University of California San Diego Professor Valerie Ramey is considered the leading expert. She indicates that the historical average for the United States government is 1.4. For every government dollar the ripple effect across the economy is $1.40. Money spent early in a recession has a larger multiplier than in a recovery. The multiplier effect varies with consumption. Government spending placed in the wallets of those who will consumer more of it will produce greater multipliers than those who do not. This is the concept of marginal propensity to consume.

Minnesota’s current gross state product (GSP) is about $275 billion. One estimate from the United States government is that Minnesota spending is $20 billion per year, or about 7% of the GSP. Assume a State multiplier of 1.4x; then total annual state spending produces additional effects equal to another $8 billion. Suddenly state spending accounts for over 10% of the GSP.

The shutdown will clearly have dramatic effects on the economy and unemployment rate beyond laying off state workers. The State recently informed 572,000 Minnesotans on cash welfare, food support and health care programs; 7,000 families receiving adoption assistance payments, and 26,000 families receiving child-care subsidies that they may not receive help after July 1. All these are individuals who will most likely consumer most money they receive from the government, thereby producing a higher multiplier effect. But the multiplier does not stop there.

Many private vendors and contractors doing business with the state–including those from the private and non-profit sectors–may not get paid and would stop work. Local governments too, facing uncertainly and a halt to payments, might also be forced to layoff. It is not inconceivable to see a partial or total shutdown of the state pushing the unemployment rate to over 8%.

The political stakes here are significant. The GOP Legislature and the Governor are in a battle over who controls the state and the political agenda. But both are also battling with their bases.

If the GOP blink and compromise they have a better chance of winning re-election in 2012. But if they do they alienate their political base and Tony Sutton, facing challenges from the right. They are trapped by their own rhetoric.

Dayton so far has played it well with the cut spending and raise some taxes and then agreeing to cut more and reduce some taxes. Public opinion still supports him but recent polls show support for him is down to about 43%–approximately his vote last November. He is down to base politics in terms of support for his leadership. But support for the legislature is in the 25% range–even worse. Dayton can continue to use the 4/2 strategy to his advantage. He is up for election in 2014, the GOP next year 2012. An angered public takes it out on them first.

If Dayton forces the GOP to crumble because of public opinion and fears of 2012, he breaks the GOP’s back. He does that by pushing Tony Sutton and the TEA Party wing to challenge the already conservative state GOP, forcing a war within the party.

Dayton has to win this battle to retain support of his base, he appears to have lost support from all but that. If he gives in anymore he damages support to his core constituency. Thus the reasons or why Dayton added medical payments at the last minute to his list of core functions to be funded–better not alienate the grandma in the nursing home vote.

The legal battle here are amazing and reveal contrasting views of the State Constitution and political power.

AG Swanson has produced the best legal brief and arguments that build on past state law. She has argued for a more expansive notion of core functions, using her consumer advocate role to represent the people. Her brief argues for continued funding of federal mandates, the constitutional obligations, statutory requirements, and protection of vulnerable people in the event of a shutdown. This would result in a soft shutdown, less onerous than Dayton.

Dayton’s legal arguments are most fascinating. He first asks that Judge Gearin order mediation. She cannot do that since the legislature is not a named party and therefore cannot be brought into mediation. There also are constitutional problems (separation of powers) in issuing this order. not issue any orders until after July 1. Dayton’s second legal argument is that the issue is not ripe. He also opposes allowing the joining of additional parties, contending that there is no real dispute here yet. His attorney argues that once July 1, hits, then maybe one can go to Court to order certain action but until then there is no real legal issue. But more importantly, Dayton has suggested that he has inherent constitutional authority as governor to act on July 1, to keep core state functions going! This is an amazing argument based on separation of powers and the governor’s veto. His arguments remind me of Nixon during Watergate, Bush after 9/11, and Pawlenty when he acted to use unallotment to end the budget impasse. This is a significant assertion of authority. Dayton’s arguments for the funding of core functions by the court is far less than Swanson, but the legal implications of his arguments more extensive.

Now the GOP. First the four GOP senators who cannot shoot straight. First they go to the Supreme Court asking a halt to the Ramsey County proceeding. The basis of their claim is that they did not think they could win in district court so therefore they wanted to go to the Supremes. (They also mentioned in their brief that they did not want the court to intervene since it would change the balance of power in a political dispute). The Supreme Court correctly told them to go to district court. They reminded them they would take original jurisdiction only in emergencies and this was not one. Overall they instructed them on Civil Procedure and Law School 101–file complaints in the proper court and don’t venue shop.

Then on Thursday the same gang of four ask the judge to order Dayton to convene a special session. They somehow forgot the plain language of the state constitution textually commits this decision to the governor. Somehow all the language about the political question doctrine, separation of powers, and constitutional interpretation they developed in their Supreme Court brief was forgotten. This is also the gang that takes what they think is a literal reading of Article 11 of the State Constitution in contending (wrongly) that only the legislature can appropriate funds. Obviously they have forgotten about issues such as the Supremacy Clause and do not understand the difference between the state and federal constitution.

Then there is the House and Senate GOP. Their main legal strategy seemed to be to agree with Swanson and allow for more of the government to be run as core functions. If Swanson wins then the GOP get the minimal government they want.

Finally, the courts are a major player here. They too have filed to make sure they are funded. And then of course Gearin. She made clear her disgust with the whole process, threatening minimal action that will please no one.

Overall, everyone is playing chicken. But what are the real stakes here? Former AG Mike Hatch stole the show. He indicated he was representing a woman who received state medical assistance to breath. He pointed out that she wanted to continue to do so after July 1. That summed it up.

Closing Thought
How long the shut down? Submit your answers to my blog. I do not know how long but am certain it better not go to State Fair time. Imagine 1.6 million angry Minnesotans talking to elected officials at the Fair.

Wednesday, June 15, 2011

Do the Math: The Costs of the Government Shutdown (And how to avoid them in the future)

This originally appeared as an opinion piece on June 10, 2011 in Politics in Minnesota.

The Minnesota state government shutdown looms larger and larger. But what is the cost of the shutdown? Some may think that closing down Minnesota government, partially or totally, however briefly, might yield savings. For those who believe government taxes and spending hurt private investment, the shutdown should produce a bonanza for private economic growth. Yet with public employees furloughed and their salaries and benefits not paid, programs not implemented, and projects not funded, all of this should lead to significant savings to the state, especially if it produces broader cuts and reductions in state and local spending.

But savings as a result of a shutdown are illusionary, outweighed by the costs. While ideally it would be best for the governor and the legislature to reach agreement, there is a serious need to consider adopting an alternative proposal to prevent future threats or real shutdowns–an automatic continuing resolution that funds and taxes the state at the same level of the previous biennium if no agreement is reached by the end of regular session.

There are savings associated with the shutdown. They include not having to pay wages and benefits to public employees. There are also operating costs as a result of not having to delivery certain programs. These could be savings in terms of health care expenditures to individuals for programs and services. The question is whether costs due to a shutdown are more or less than the savings?

How does one calculate the cost of a real or threatened shutdown? Economists use the term avoidable costs to refer to expenses that would not have to be incurred were some transaction or event not to occur. There are certain costs incurred with the shutdown that could be avoided if a budget deal were secured or no interruption in funding occurred.

What are avoidable costs? There are a host of costs incurred as a result of a shutdown that could be avoided. First, there are the costs associated with planning for the shutdown and then the start up of government functions. This also includes time spent by state agencies and workers on planning for the shutdown that is not spent on doing regular work. One cannot simply close and lock the state door at 5 PM–there must be an actual plan on how to do this, with this planning diverting state resources away from regular service delivery. These planning costs occur even if the actual shutdown does not occur. Second, there are the actual costs of shutting down the government such as laying off people, terminating or halting contracts.

Third, there are uncertainty costs. These include costs to state and local governments and school districts incurred as a result of not knowing how much money they will have for the next two years. A local government or school district not knowing know much money it will have may refrain or delay hiring teachers or planning programs. Uncertainty means creating contingency plans or otherwise delaying making some choices, thereby costing more money.

In addition to planning for the shutdown and restart, there are actual costs of starting up government functions such as rehiring individuals. It will cost money to notify, rehire, resume benefits, notify vendors, and begin implementing programs.

While government is shutdown, the State of Minnesota potentially loses revenue. This loss of state revenue includes delayed payments and tax collections and park fees. There are also litigation costs such as asking for temporary funding in court or in other litigation surrounding a partial shut down.

Finally, two last costs. There is a loss of personal income and out of pocket expenses associated with public employees being out of work. Many of these workers will have to pay for medical benefits out of their pocket or assume other expenses. And there is also a loss of state income and consumption as a result of public employees planning or actually being out of work. This loss of income includes losses to private vendors not being paid on contracts, lost business due to parks being closed, and other losses of income resulting in the state not operating. As more people are out of work, this hurts Minnesota’s economy.

Adding it up, the total costs associated with the shutdown exceed total savings. Moreover, many of the savings disappear once workers are rehired and programs have to address backlogs in services undelivered during the shutdown.

The point of this exercise here is simple: Taxpayers are going to spend more as a result of a government shutdown because Dayton and the Republicans could not agree. For conservatives who rant about government spending and taxes, their intransigence over tax increases and their unwillingness to compromise means taxpayers pay more.

Given the costs of a real or potential shutdown, can something be done? One solution is to adopt a variation of what they do in Wisconsin. In that state an automatic continuing resolution funds state programs if the legislature and the governor fail to reach agreement on the budget on time. Here in Minnesota given that there was a real shutdown in 2005, an almost shutdown in 2001, and many other years where special sessions were needed to reach agreement, automatically carrying over into the new biennium the previous budget and taxes solves many problems. It certainly does not address all budget issues and it is inferior to reaching agreements, but it is one way to avoid the costs associated with the threatened or actual shutdown.

Tuesday, June 14, 2011

And the Winner is. . . Preliminary Thoughts on the New Hampshire GOP Presidential Debate

Who won the debate last night? Bachmann and Romney emerged as winners in very odd ways.
Bachmann won but not really on substance. She won by her announcement that she was officially running for president. Her announcement was brilliant in the sense that she knew it would be the major news or headline item the next day. Yet again with this announcement she proved her ability to capture headlines and to shine the spotlight on her. Thus, Bachmann wins the public relations battle.

Romney was also a winner. The expectation was that the other candidates would go after the frontrunner and smear him with the phrase Obamacare. They failed to do so. Even Tim Pawlenty, who just a couple of days earlier had attacked Romney for creating Obaneycare, shrank for doing it. Because Romney held his own, did not suffer an attacks, and also managed to attack Obama himself, he appeared to escape the debate without scars and therefore won.

Beyond the Bachmann announcement and the failure of the field to attack Romney, there were no surprises in the debate. All of them attacked Obama and all of them more or less said the said thing when pressed on the economy, health care, abortion, and gay rights. What was most striking was how little they really disagreed, with all concurring that any of them would be better presidents than Obama.

But even more striking was how bland all were and how little they had to really offer as president. They were all strong in their criticism of Obama and the government but offered little in terms of real solutions. They all said the problems in the economy and the world were rooted in too much government and taxes, contending that by cutting both the private sector would solve our problems. Government thus crowds out real private sector innovation. Paul was most clear in arguing this. But beyond saying government was bad they offered little in terms of what government could do or why they wanted to be president. Instead, they all seem to be running for a job they want to eliminate.

Tale of Two Pawlentys
Pawlenty was interesting. It was a tale of Two Pawlentys. There was the governor of Minnesota who liked to describe himself as a moderate. Now it is a Pawlenty who took pride in passing pro-life laws, packing the court with pro-life judges, and a candidate against law rights and any type of government action. Who is the real Pawlenty?

Quick note on Bachmann
With her formal declaration that now means her congressional seat is up for grabs. All along it seemed clear that November, 2010 was the last time she would run for the House of Representatives. At that time it looked like redistricting or a run for the senate would be next for her, not the presidency. Nonetheless, Bachmann’s seat is open and that should begin a scramble for it. Moreover, think about her poor constituents. From the day she was sworn in this January Bachmann has been effectively running for president. She will now continue to do that leaving her district without any real representation.

At the debate Bachmann held her own and looked and sounded like the rest of the field. She turned away comments about her extremism and association with the TEA party may hurt her. She did a good job in sounding as bland as the rest.

Also, if Bachmann does not succeed in her presidential bid, running for president does not hurt her marketability or chances to challenge Franken in 2014.

Thursday, June 9, 2011

Hamline University School of Business BBQ on June 22

Looking for cheap eats? Come to the June 22, 2011 Hamline University School of Business BBQ and picnic at the Minnesota State Capitol from 11:30- 2:00. Learn about our public administration program and meet faculty and other students.

Famous Daves (not me!) supplies the food. Yum!

See attached for more information and to reserve your spot.

Minnesota judges can order temporary spending to prevent a government shutdown

Today's blog post was on on June 9, 2011.

May a Minnesota judge order the spending of tax dollars to fund essential state functions if the state Legislature and Gov. Mark Dayton do not reach a budget agreement by July 1? This is a legal question that will be asked in the coming days as it is anticipated that Attorney General Lori Swanson will approach a Ramsey County District Court judge with a court order for just this purpose. Yet some contend the court lacks this authority and it cannot do this. They are wrong.

The core of their argument rests on three claims. First they point to Article XI, section one of the Minnesota Constitution, which states: "No money shall be paid out of the treasury of this state except in pursuance of an appropriation by law." Second, they argue that the failure to reach a budget deal is a nonjusticiable "political question" that should be resolved by the political process. Third, they contend separation of powers precludes the courts from addressing budgetary matters. These arguments all rest upon an incorrect understanding of the Minnesota courts and the state constitution.

The central error here is drawing a parallel between the Minnesota and the federal courts. The argument is that the U.S. Constitution and its separation of powers preclude federal courts from intervening in political questions and from ordering spending. Besides this claim being wrong on the national level, there is a major difference between the federal and state courts. Whatever limits there are on federal courts, they do not necessarily apply to the state judiciary. State courts, including those in Minnesota, have unique powers compared to those found at the federal level. They are governed by state constitutions that allocate powers to the three branches of government that often differ from those found at the national level.

Across the country state courts have been given powers under their constitutions to issue advisory opinions, to order spending to achieve adequate school funding, serve on redistricting commissions, and to enforce unique rights not found at the federal level. The same is true in Minnesota. There is case law supporting Minnesota courts ordering funding to ensure that the state judiciary can operate. What if the Legislature and the governor disliked a Minnesota Supreme Court decision and decided to retaliate by not funding the judiciary? Such a move would violate the state constitutional separation of powers clause (Article III) and Article VI, which invests judicial power in the Minnesota Courts. At the very least, separation of powers demands funding for the courts, regarding of whether it was appropriated according to whatever Article XI states.

Reading in light of other clauses
A central canon of statutory and constitutional interpretation is to read words to avoid absurd results or to render some language superfluous. A reading of Article XI that states money can only be appropriated if approved by the Legislature would produce odd results that render Article VI and Article III meaningless. Article XI must be read in light of other constitutional clauses.

Moreover, a so-called strict constructionist reading of Article XI and separation of powers must be understood within the context of the Minnesota and not just the U.S. Constitution. Article III of the Minnesota Constitution has a different history and meaning from federal separation of powers, thereby again suggesting that Article XI appropriation authority must be read differently from what is found at the federal level.

Because Minnesota courts follow different rules from the federal courts, claims of justiciability and separation of powers that appeal to federal analogies are inapt. What might be considered a political question or otherwise textually committed to Congress or the president under the U.S. Constitution might not be true in Minnesota.

An additional duty
But in addition to the Minnesota courts having different powers from those found at the federal level, they also have an additional duty beyond interpreting state constitutional provisions and the law. They are expected to enforce the U.S. Constitution and federal law. When state and federal constitutions and law conflict, the federal wins. Thus, notwithstanding any state constitutional provision, a state court might be required to order the funding of any federally mandated program, even if the no budget deal was reached. Thus, whatever Article XI of the Minnesota Constitution might mandate is overridden by federal law.

In sum, those who argue that the Minnesota courts cannot order funding for essential governmental functions are asserting a wooden and formal reading of the law. The uniqueness of state court authority, constitutional provisions, and the need to enforce federal law give Minnesota courts the power to act. This was true in 2001 and 2005 when state courts declared they had the authority to act, and the same should be true in 2011 if called upon to so rule.

Wednesday, June 1, 2011

Bachmann, Palin, Overdrive

Bachmann and Palin. The very prospects of both entering the presidential race have created a frenzy. Both are media magnets and savvy in the art of attracting attention. But how do we assess them as presidential candidates within the GOP field and, if either to emerge as a nominee, as a potential candidate against Obama?

I discussed this issue on Fox 9 News recently . Look at the video in addition to my analysis below.

Outsiders within the GOP

The simple way to describe Bachmann and Palin is that both are outsiders within the Republican Party who draw their strengths from very similar sources. Both candidates have clear messages about taxes, limited government, and social conservatism that appeal to the Tea party wing of the GOP. Thus both have something that Tim Pawlenty, Newt Gingrich, and perhaps even Mitt Romney lack—a clearly identified voice or political narrative that definitely appeals to an energetic base of the Republican Party. This linkage of a voice to a constituency is critical because it means that both of these candidates have a capacity to mobilize an identifiable portion of the party. When it comes to Iowa for example, a state all about caucuses and grassroots organizing, the ability to appeal to a specific and highly energetic constituency is very important, especially for Bachmann.

Comparing Bachmann to Palin

Bachmann and Palin share other affinities. Both are terrific at fund-raising. Palin is a major draw on the speaking circuit and since leaving the vice-presidential race she has branded herself and daughter Bristol into a Paris Hilton like commodities that has made her millions. Palin is an industry and can raise money, perhaps even for a presidency. Not as well known as Palin, Bachmann has proven to be a powerful fundraiser–garnering $20 million plus for her Congressional campaign last year and reportedly with more than $2.5 million already for her potential presidential bid. Moreover, each has a propensity to say the outrageous–Bachmann in declaring the constitutional framers as having freed the slaves, Palin in her take no prisoners campaign rhetoric. Both have been recurrently featured on Fox and MSNBC, pandered before conservative and liberal audiences as Nielsen ratings enhancers.

There is no question though that Palin is the better know of the two candidates. Right now she is near the top of the GOP polls and her bus tour is gathering a lot of attention. Were Palin to run she would start off strong, even if she were to skip Iowa.

Bachmann’s is truly an Iowa strategy. From Waterloo, she hopes to mobilize her roots and appeal to a Tea party constituency (and discontent with other GOP candidates). It is not inconceivable that she could get 20% of the caucus attendees, thereby pushing her to the front of presidential contenders. This is possible but for Palin.

Palin and Bachmann draw strength from the same part of the party. Should both enter they potentially split their support and the Tea Party wing. This sets up some interesting dynamics. First, if both run, does their conservatism force the rest of the GOP further to the right or do they concede it to them and battle for whatever one calls the more moderate wing of the party? Even if only one of the two runs, the same question can be asked. But if both run the potential of a split complicates strategies for all of the field in terms of appeal to their base, ignore, move to the right or more centrist.

Their Negatives

But as much as there are strengths are parallels to Palin and Bachmann, both face liabilities. Both are outsiders in the party. Palin likes her rogue persona and Bachmann has constantly upstaged the GOP in terms of stealing the light from Paul Ryan and the Republican response to Obama’s State of the Union speech. Then there is their political rhetoric–nothing moderate here for either. How they can broaden their appeal beyond the Tea Party within the GOP is a mystery, let along to the swing voters in a general election will be difficult.

Palin has two additional problems. She is well known (a plus) but also has astronomical negatives. Carrying over from the 2008 VP bid, over 60% view her as unqualified to be president. She did herself no favors in her self-absorbed response to the representative Giffords shooting. Second, she has little in terms of a presidential infrastructure that can help her in Iowa or other early states and having alienated many in the GOP establishment, she is damaged goods in many ways.

Bachmann too has alienated the GOP establishment but she is not as well known nationally and therefore does not appear to have the same negatives as Palin. People have not made up their mind about her since she is not as well known. Unlike Palin, Bachmann has a chance to define and make her image and create a narrative. Palin is already done. She has no real potential for growth and makeover–perhaps by choice. Her brand and persona are fixed. Finally, Bachmann is working Iowa and seeking to build an infrastructure, Palin really is not.

Final Thoughts

Overall, assessing the two, while Palin is better known Bachmann has more room to grow as a potential GOP presidential candidate. But of course, both many stand in each other’s way, competing for money, voters, and a slice of media coverage. Because of their similarity, don’t look for the Tea Party dream ticket of the two running together. This is a ticket that would appeal to 25% of the general election electorate–giving Obama a major victory.

No doubt we have not heard the last of Bachmann and Palin. “You ain’t seen nothing yet” as BTO once sung.