Thursday, February 11, 2010

When state politics meet national politics

Tim Pawlenty gave his State of the State address today. Two related thoughts:

1) He's running for President. The parts I heard were full of bad jokes and anti-tax, anti-government rhetoric. Lots of talk about lowering the tax burden of Minnesota, not as much about our $1.2bn deficit. I'm surprised he didn't give the speech remotely from Nashua, NH or Des Moines, IA.

2) There is no way Minnesota is going to be able to deal with this budget shortfall. Obviously, all the states are having budget troubles as revenue drops in this recession. This is the reason the federal government needs to spend money to prop up demand and thereby get people working and buying stuff again. Counter-cyclical spending. Unfortunately, states can't run deficits the way the federal government can. This is why aid to the states was a big part of the stimulus. To deal with shortfalls in revenue, states had to make painful spending cuts. Unfortunately, this recession is bad enough that you're not going to be able to cut your way out. There just isn't enough fat in a state budget to cut. You end up cutting teacher salaries and laying off important city workers.

Well, then, it looks like you're going to need to raise your revenue inflow. But wait, T-Paw is running for president. He's running as a fiscal conservative (6 out of his 8 years as governor MN ran a deficit, which I think is the definition these days) and in current terms, that means that all taxes are bad, as is all government. He knows he'll get killed by his GOP primary opponents if he raises taxes. So he's going to go to the DFL-controlled state legislature and tell them to balance the budget with spending cuts, and don't raise taxes. They'll tell him he's an idiot, that you need to raise taxes. He'll veto any tax increase, they won't be able to find enough cuts, and T-Paw will probably resort to unallotments again.

Does this sound like good governance? No, but it's good politics for T-Paw. He can point to his fiscal conservative credentials in making painful cuts and never raising taxes. Unfortunately, the state of Minnesota will suffer.

EDIT: Heh, I'm sure he's on Hannity tonight to raise awareness of Minnesota issues, and not to raise his national profile.

EDIT2: Definitely not running for President.

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