Watching the Minnesota budget process is like living
in Groundhog Day.
The 2021 regular session of the Minnesota Legislature
limps to an end without a budget deal. No news here, it was entirely
predictable. Not since 1999–the first year of Jesse Ventura’s term as governor–has
a budget session of the Minnesota Legislature ended on time without a special
session, partial governmental shutdown, or a controversial ending such as in
2009 when Pawlenty used his unallotment power (subsequently declared illegal by
the Minnesota Supreme Court) to balance the budget.
I first wrote this blog on May
21, 2011–exactly ten years ago.
Nothing has changed in a decade.
What has emerged is the New Normal for Minnesota
politics. The New Normal is that the completion of the budget does not occur by
the constitutionally-mandated deadline in May but instead July 1–the
commencement of the new budget year. That seems to be the new deadline. But
even then, that date, like October 1, for the federal government, appears more
suggestive than drop dead. A threatened partial shutdown in 2003 and then a real
one in 2007 and 2011 too eased the stigma of missing July 1, in Minnesota.
Why the New Normal?
The question becomes why? Why has the New Normal
emerged? Nothing has changed from a
decade ago when I first wrote about the New Normal, but in ten years it has
only grew worse.
Why does it seem impossible to reach budget agreement?
One answer is divided government, yet even back to the days when Perpich was
governor and the DFL controlled the legislature there were special sessions to
address the budget such as in 1985. Under Carlson and then Ventura they became
more frequent and then under Pawlenty and Dayton they emerged as the new
normal. With Walz, the same pattern. No;
divided government is only a partial answer.
There are two causes explaining the rise of the new
normal. The first is a growing ideological divide over the nature of
government. The second is structural, questioning the efficacy of the current
budget process.
Why Government?
The governor and the split legislature are as far
apart today as they were in January regarding all the essentials over the
budget. It is about dollar and taxes
yes, but it is also about other fundamental divides in America, of which Minnesota
is a perfect microcosm as the only partisanly divided legislature in the nation
where one party holds control of one chamber, another party control of the
other.
At the heart of the dispute is a basic difference in
their rival views of the government versus the market. The GOP generally seems
to see government and taxes as bad, an intruding upon the wisdom and
functioning of markets. Let markets act and they will generate jobs prosperity
and solve the basic problems of society.
For Walz and the Democrats, while market solutions and
the private sector are the preferred places to produce jobs and make decisions,
they recognize markets fail. Markets fail to address needs of equity. They
produce inequities in wealth and income distribution, they fail to address core
problems of education funding and disparities, they fail to address problems in
infrastructure investment.
No, it does not look like the GOP wants no government.
Many still find it necessary to hire police and enforce basic laws, and
apparently to enact laws to prevent same-sex couples from marrying and women
from terminating pregnancies or give tax breaks to the wealthy. The real
difference between the GOP and Walz and the DFL is over how much government and
what government should do in our society. It is a debate between rivaling
views-government versus the market, the individual versus society.
We live in a society new where everything is a
partisan divide—yes or no, no in between.
Police reform, facemasks, vaccines, marijuana; you name it, there is a
divide an no incentive to compromise. With
there barely 10% of the State House and Senate seats truly swing, most are in
firm partisan control of one party and there is no incentive to compromise.
Conversely, compromise means facing a primary opponent from the left or right. One cannot give in—it is a sign of
weakness.
The debate over “why government” is ideological.
Arising simultaneously are two other phenomena aggravating the debate over why
government–the triumph of ideology over pragmatism and party polarization.
Thus, as part of the New Normal is that no
negotiations can take place in public.
Dating back at least to Dayton all compromise is behind closed doors, often
out of session, involving the governor and chamber leaders. New Normal means less transparency and open
government.
Combine politically polarized parties with a take no
prisoners ideological divide over the role of government and what do you get?
A Flawed Budget Process
But the polarization is only one problem. The second
is the flawed budget process in Minnesota. I have been arguing this point for
nearly 20 years.
It is a budget process built for the horse and buggy
days trying to operate in the 21st century. Government is so much more complex,
the budget numbers so much larger, the functions more diverse, that it is
perhaps impossible to reach consensus and make decisions between the beginning
of January and the State Constitution forbids the legislature to meet in regular
session after the first Monday following the third Saturday in May in any year.
There simply may not be enough time to do the budget by law.
But think also how flawed the current budget process
is right now. The old governor makes the initial budget. New governor is
elected and needs to update it to reflect his priorities and the fiscal
forecast in November. The Legislature comes to work in early January and then
it waits until late January or so for the governor to release the budget. Then
they all wait until late February for the updated fiscal forecast.
Thus, it is not until late February or March that the
work on the budget commences. And even then, there are separate hearings in the
House and Senate, forcing conference committees to act. The budget also is
really ten separate bills, with spending distinct from taxation, and no real
work gets done until there are agreements on the different spending targets for
each of the areas such as HHS, K-12, and so on.
Sound confusing? It is. It is also inefficient. At
least two months are wasted at the beginning of every budget cycle waiting for
the governor’s budget, the fiscal forecast, and then agreement on budget
targets. Now add more wrinkle–budgets are created right after state elections
when often many new legislators or constitutional officers are elected. They
are green, often learning on the job while creating a new budget. In a distant
past when life and budgets were less complicated (and smaller), perhaps it was
possible to do all this with a part-time citizen legislature. But those days
have passed. A new budget process is needed, with new time lines and ways to
move the work along.
A decade or more algo I proposed solutions to the
process. Change the timing of events. Move the budget to the second year of the
session to allow new legislators to learn their job. Adopt as they have in Wisconsin an automatic
continuing resolution to extend the current budget into the next fiscal year to
prevent shutdowns. There are other reform ideas too, but no will to change.
Someone once said that the definition of insanity is
doing the same thing repeatedly and expecting different results. Politically this is what we are doing in
Minnesota for more than 20 years. If
this is not politically insane or crazy, I do not know what is.