The shrinking world of a hunkered down America is now reversing toward expansion. President Obama was interviewed Tuesday on the Dubai-based Al-Arabiya news channel where he told Muslims that Americans are not their enemy. The president is also proposing an expansive domestic stimulus package, and Minnesota will look for its share. The two Bush administrations followed on the Reagan plan to shrink domestic spending while puffing up the military budget to record highs.
The president says he wants to put Americans back to work as soon as possible. One G.W. Bush tactic was also a stimulus to push more revenue down the line to states. There were many strings attached and hungry states like Minnesota complied. Meanwhile states have been pushing responsibility for costs down to local governments and now push has come to shove.
Here in Minnesota, the state budget proposed by Governor Pawlenty is a repeat - in spades - of his previous budgets. In 2003 he used tobacco settlement funds from a successful suit won by the redoubtable Attorney General Skip Humphrey. Pawlenty snatched the tobacco money to fix the deficit. Then he cut Local Government Aid (LGA) to municipalities, choking them and forcing large cuts in their budgets.
This time Pawlenty will dip into tobacco money again that will go up in smoke on deficit relief. The money's intended purpose to help improve the effects of tobacco use and to prevent tobacco use by youth will be thwarted. He intends to cut LGA again to an even greater degree. But how much is too much?
This time the projected deficit of $4.8 billion is staring Pawlenty in the face like Dickens' ghost of Christmas Yet to Come. The Minnesota budget must be balanced. What can the governor do to avert a fate worse than Scrooge's?
What he has done with his $33.5 billion budget is to propose 50% tax cuts for businesses. They are supposed to hire people who will pay 100% of taxes due. The wobbly legs of previous budgets are sure to fall this time as Pawlenty goes for the same old tactics as before. He will leave Minnesota breathless after he finishes his cuts to the expense side of the budget. Every government facing deficit has to cut expenses but in 2009 the Minnesota governor has built a house of cards that will collapse at the next wisp of wind in this ongoing recession.