Tom Gillaspy shares insights on the state budget situation based on
his three decades of government work and his perspective as an
economic demographer. The state needs structural reform, he argues, in
order to adjust to structural deficits that persist under the present
framework. Even as we work our way out of the recession, Minnesota
will continue to lose its capacity to provide services at present
levels. He argues that Minnesota leaders should first develop a common
vision for the state's future, a common understanding of our goals
which lawmakers and the governor could then use in assessing proposed
strategies for reform.
summary will soon be on Civic Caucus website:
Readers have been asked to rate, on a scale of (0) most disagreement,
to (5) neutral, to (10) most agreement, the following points discussed
Average response ratings shown below are simply the mean of all
readers’ zero-to-ten responses to the ideas proposed and should not be
considered an accurate reflection of a scientifically structured poll.
1. The problem.
(8.6 average response)
of retirees will soon increase sharply, long-run economic and income
growth will slow, government revenue growth will slow even more, but
pressures on spending, especially for health care, will increase.
(9.2 average response)
These are long
term problems that will only get worse unless we change the way things
(7.5 average response)
If the state
cuts back on investment for economic growth to fund moral obligations,
its future capacity for economic output is diminished.
(7.9 average response)
productivity will result when the state improves outcomes at a lower
5. Too smug?
(8.0 average response)
been too smug, failing to realize they're in the middle of a big
storm, that people need to work together or the ship will be lost.
(9.2 average response)
leadership to develop a common idea for what the state should become
and what needs to change to get there.
5. Too smug?
(10) (10) (10) (7.5) (7.5) (10)
Redesigning needs to be the whole system - not just the organizational
structure. Rules and statutes need to relieve the mandates,
6. Vision. This
is an extremely important idea - the vision could be swayed depending
on who personally is involved - that is scary if it is politicians
rather than policy/analysts/researchers (need people with facts rather
(7.5) (7.5) (7.5) (0) (2.5) (10)
1.The problem. I
am not sure that these are functions of each other, that is, more
retirees does not have to translate to slow growth.
2. Outlook. Same
linkage concerns, and also just changing the way things are done is
growth. I have never been convinced that the state is the driver of
economic growth; facilitating growth, yes, but not driving it. For
example, the regulation issue is credible, so is education, but
bonding, tax cuts etc. may not be.
State productivity? The key is efficiency and economy. Why did I have
to change addresses in several locations when I moved? The exchange of
information today should not let that happen. And business is faced
with those inefficiencies all the time, but business is not
necessarily a good model, that is, not in all cases.
Politics as usual needs to end. But again the state is a provider of
services to support the economy not the changer of it. For example,
providing for disclosure of costs of medical care and overhead is a
state function worth doing, and if private enterprise does not do the
cleaning up needed, then the question is how to force them to happen.
(10) (10) (10) (10) (7.5) (10)
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1.The problem. The
State of Minnesota should negotiate several health care plans that are
mandatory use by all state and local government employees. All the
contracts will contain premium structures that are based upon health
of those covered.
Transit management in the metropolitan area is out of control. 70%
of the metro population and jobs are in the suburbs yet there isn't
suburb-to-suburb transit system. Vehicles are needed from nearly
everywhere in the metro area to get to the suburban jobs. We do not
have a comprehensive transit system serving the area. We are making
very large capital expenditures on a few projects with minimal transit
outcomes, small increases in revenue, and much higher operating and
maintenance costs. Our transit vehicles have very little occupancy on
the outbound in the morning and the inbound in the afternoon. Very
inefficient! Metropolitan Council needs to plan transit and remove
itself from operations. Eliminate the Opt-Out transit systems. All
Metro Counties pay the additional sales tax. Contract out transit
services. Get our businesses, communities, developers and
Metropolitan Government managing growth, roads, infrastructure and
transit so our taxes and fees are used wisely and with vision.
Eliminate County Transit boards and their fund control. Provide a
comprehensive transit system throughout the metro area. Change the
method of Metropolitan Council appointments to ensure a more
effective, fair organization with long- and short-term plans and
growth. All local government pension plans should be transferred to
State Control. If they are underfunded, the employers/employee
contributions should be increased and pensions decreased until they
are properly funded and a reasonable reserve established and set-aside
for pensions only. Employers whose pensions are underfunded shall
develop and implement business plans to reduce their spending,
increase taxes … until their pensions are properly funded. Pensions
should be indexed based upon a cost of living index for seniors with
upper and lower limits to ensure all civil servant retirees are fair
and increase with reasonable controls.
5. Too smug? I
would rephrase - "Many of our elected and appointed leaders" have been
6. Vision. I
have little trust in our elected leaders achieving this goal,
implementing the plan, keeping it on course, regularly measuring
performance and updating. We can't be significantly changing plans
based the results of each election. We have many excellent policy
groups that should cooperatively meet this endeavor.
(10) (10) (2.5) (0) (7.5) (10)
2. Outlook. If
everyone shares in the hurt - increase gas tax, 5% pay cuts for
occupations funded by taxes, then long term, more folks will be able
to continue working.
growth. If "investment" means "spending" or "increasing taxes".
What … does this mean? What does "improves outcomes" mean? If you
want considered responses, you need to ask direct, understandable
questions, that can be answered because they were understood.
5. Too smug? If we
were - because we were, part of the reason we are no longer head and
shoulders above rest of the nation is our years of prosperity
attracted émigrés from other parts of the country. This may have
resulted in becoming more homogeneous and no longer a bastion of the
well educated, disciplined and stoic Minnesotan. We are sinking to
the lowest common denominator rather than trying to bring up the
6. Vision. Both
sides of the political spectrum take too much time crafting political
solutions that appeal to their constituents.. We need real
compromise. We need more taxes and less spending. That means
everyone pays taxes not just 40% of people. That means everyone gets
only 90 to 95% of their pet programs funded; welfare, the Honey
Inspection Board, etc. That means we need to fundamentally redesign
government to take it out of direct competition with private
enterprise, and provide only basic infrastructure and not provide a
lush livelihood to some, to be funded by the many. We can no longer
be setting aside public lands that consume resources and produce no
revenue and pay no taxes to the government. We need to start
divesting ourselves of these holdings to promote business growth and
gather property taxes. We need "gaming" to be extended to already
regulated locations like the two racetracks. Those taxes derived from
those venues become voluntary since folks can choose to participate by
making "contributions" to state coffers.
(10) (10) (10) (10) (10) (10)
(10) (10) (10) (10) (10) (10)
1.The problem. We
have had a failure in Minnesota state government during the past 25
years to prepare for the changes happening today. Today's
demographics are not unexpected and were clearly forecasted. We have
had a failure of leadership in this state. Unfortunately, I see
little from Governor Dayton to suggest any change in core state
2. Outlook. We not
only need to change how things are done, but also what is done. The
state can no longer fund every program. Furthermore, compensation
costs to government employees are on unsustainable trends. Either
there has to be a way to rein in salary/benefit increases or there
must be a reduction in the number of government employees.
growth. There is a real risk that if Minnesota does not make the right
choices, it will become a tier two state in the country.
Unfortunately, the state does not have many productivity measures.
And you tend to improve what is measured. So I suggest step one is
coming up with true productivity measures. For instance, in
education, you could measure standardized test scores per dollar
spent. At some point, you spend more than any increase in test
scores and that becomes nonproductive spending.
5. Too smug? I
really think most Minnesotans think they live in their own eco system
and are unaffected by world events. This is so incorrect that one
hardly knows where to start educating the state's residents.
6. Vision. I
think the only vision for the state of Minnesota is to be the
"entitlement" state where we constantly support and reward the weakest
and least productive covered by the term "moral obligation."
Unfortunately, this is the least moral course of action because in the
long run the state will not be able to afford any "moral obligations"
and the state will be composed only of the weak and nonproductive.
That does a disservice to the state and to the citizens of the state.
(2.5) (7.5) (0) (2.5) (2.5) (7.5)
Assertions and hypotheses need to be verified or explained, not just
stated or accepted as fact. 1. Yes, but only as long as the current
childbearing generation continues to "buy into" the ZPG propaganda
that gripped the previous one. 2. Not necessarily; definitely yes if
socialist policies are put in place. But a return to free enterprise
and the free market will spark growth. 3. Ditto. The government
benefits or suffers along with all other participants in the economy.
Therefore it should be their moral imperative to keep their costs and
expenditures at the absolute minimum at all times. 4. Ditto.
Pressures on spending come from misguided ideas about the government's
functions and responsibilities.
2. Outlook. Well,
yes, if you continue down the path outlined in “Obamacare”. Let us
hope that by "we change the way things are done" the presenter means
returning to a competitive free market, low taxes, and reduced
regulatory burden; allowing the inventiveness and entrepreneurialship
sparked by the profit motive to create solutions that we have not even
thought of yet.
growth. (From the tone and context of this discussion it is obvious
that "state" is intended to mean "state government," not the aggregate
sum of all producers and consumers in a State.) The state does not
"invest," it can only tax and spend. "Investment" has a very specific
meaning that cannot be applied to any expenditure by the State,
because the State does not produce anything. Somebody must produce
something of value in order to generate the revenue, which will be
greater than the initial expenditure; if that is true, then, and only
then can you call it an "investment." Economic growth comes only from
private enterprise, to the extent that the State does not stifle it
with taxes and regulations, and distortions caused by misallocation of
State funds. The State does not have any "moral" obligations to
anyone; individual human members of society do, which they are free to
fulfill personally or via participation in a charity. The State does
not have any capacity for economic output, past, present or future,
because the State does not produce anything; all it does is tax and
spend. Only a private enterprise has any capacity for economic output,
by offering products and services that customers willingly pay for.
Productivity is a concept applicable only to entities that actually
produce something of value, that is, a private enterprise that offers
products and services that customers willingly pay for. At best the
government is a necessary evil that appropriates its revenue by force,
and offers no products or services of any market value. You cannot
even measure the value of a government's services because there is no
free market for its services, no competing governments offering those
services to the same client base, no customers free to choose between
competing services. Government is set up to provide services -- such
as national and civil defense, law enforcement, and justice -- with
which no private enterprise could or should ever be entrusted. The
State, as an entity that lives like a parasite on the productive
segment of society, can improve "outcomes" -- that is, perform
whatever function is assigned to it -- by doing it with the greatest
efficiency and at the least cost possible. As a parasite, it has the
responsibility of not killing or even sickening its host; that is
hardly an indication or measure of "productivity." If at a time of
serious belt-tightening a government entity has to reduce its pay
scales and its head count, and we find that it is still able to
provide its services after the cuts, then we must raise the very
serious question of why they were running so fat and bloated before.
This is no different from how a private enterprise would react to hard
times and therefore must operate at all times. The only way the
organization survives is if it contains its costs and maximizes its
revenues. A private enterprise can maximize its revenues by offering a
product or service that customers actually want and are willing to pay
for; competition sets the actual price level. A government can
increase its revenues only by extorting more taxes using the threat of
force and punishment; therefore in a just society it has the moral
obligation to keep its costs and revenues to the absolute bare minimum
at all times.
5. Too smug? I
don't know about Minnesotans. Certainly some outstanding citizens of
the State, such as Michele Bachmann and Tim Pawlenty, give a totally
different and very encouraging impression, definitely not smugness. I
am sure there are others, like them, who do realize that the liberals
have indeed taken us into the middle of a disastrous storm. If by
"people need to work together" the presenter means we must return to
free market principles, then the ship will not be lost.
6. Vision. Yes,
such leadership exists and has existed, if anyone would only listen. I
already mentioned former governor Pawlenty and current Congresswoman
Bachmann. I am sure they have their counterparts at the State level.
And I am sure there is a Tea Party even in the MN People's Republic.
America is not a planned economy; it is the country where the free
market had at one time been the freest and therefore the most
successful in the world. People do not need "to develop a common idea
for what the state should become." The sum of the actions of its free
citizens each with their individual visions and aspirations will
determine what we will become. And we already do know what "needs to
change to get there:" we need to re-embrace the values of our
Founders, and to reject all the incompatible foreign ideologies that a
certain segment of our society, such as a Ruling Class of academic and
media elites thoroughly steeped in Marxist "progressivism," has been
trying to force down our throats for the past 150 years.
(0) (10) (10) (10) (2.5) (10)
1.The problem. The
statement is well stated but without some statement that there must be
initiatives to keep the baby boomer workforce in the workforce for
additional years in some way to keep them as revenue generators we are
missing a potentially key point. The statement as expressed is correct
but only in that if these people do not remain as contributors we have
a worse issue. Someone needs to carry the ball to change to mindset
that all people will retire at a age 65--Lets hope the thought to use
this valuable resource will be realized.
2. Outlook. See
comments above. We need incentives from a) government; b) employers;
c) the public; and d) the media. Even keeping 30% of the workforce
engaged to age 70+ would be a winner.
growth. Economic growth must be a key component of funding for moral
obligations. Too often we focus on the cost and negative side without
thinking that if we can grow some of the issues get easier. I am not
stating that we can grow out of all (these) issues but it certainly
needs to be a bigger emphasis.
Productivity must be a key parameter in any economic assessment.
5. Too smug?
Minnesotans are not smug---it is not appropriate to mix the overall
population with the political and media folks. Give citizens from
across the state a chance and they will show that MN is a positive and
quality of life state. Statements as above may be the perception but
not the fact.
6. Vision. A
vision or a purpose for Minnesota is definitely a timely and needed
topic. Whatever the statement is and whoever develops the slogan or
thought must show that this statement applies across all of MN and has
input from all corners and area and demographic of the state not just
another think tank group pull(ing) word(s) together. The big challenge
is what is the best way to form the vision --if there should be (one).
(10) (10) (10) (10) (10) (10)
(7.5) (10) (7.5) (7.5) (10) (10)
1.The problem. It
may not be totally accurate to assume that baby-boomers will retire at
the same age as their parents. Many professionals are very engaged
with their work, still very healthy, and wanting to be productive. If
industry, government and business could find a way toward more
part-time employment for older workers, it would help with the "brain
drain" about to occur.
2. Outlook. See
growth. There are choices to be made here -- it doesn't have to be
just cut or shrivel.
It (would) be good to see some evidence on this point
(10) (10) (0) (7.5) (10) (10)
This is the obvious, yet we have politicians who refuse to look at the
obvious and still live in their partisan world.
Leadership has to come from all parties, equally and without bias, in
order to develop a common idea. Can it come from our present political
environment? That is the main challenge.
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(7.5) (10) (10) (7.5) (7.5) (7.5)
Governmental services productivity will increase when the state
improves outcomes at a lower cost. Real productivity comes from the
private sector. Their productivity will result when the State (and
Feds) get off their back.
(10) (10) (7.5) (10) (0) (10)
growth. I think it depends on what investments for economic growth.
TIF? No. JOBZ? No. Education? Yes. Also, we need to develop a new
dashboard of economic indicators relevant to a 21st century knowledge
economy; c.f.: http://www.itif.org/publications/2010-state-new-economy-index
5. Too smug? I
agree with your chair: "'I've never seen in 30 years the level of
activity and interest in this issue by leaders of so many different
organizations as there is now.' There is real opportunity for a
collaborative effort." These groups emerged because there's a
disconnect and are collaborating in many, various ways.
6. Vision. My
favorite is "Minnesota, a place where children and families thrive."
Why? Because if children and families are thriving everything else is
in place. People are employed; businesses are busy. Streets are safe.
Parks are clean. Innovators can start new businesses because they can
afford health insurance for their families. College is affordable.
Better yet, how about adopting my vision for the "end-game" in Closing
the Achievement Gap? "We'll know the Achievement Gap is closed when
the diversity of our community is reflected in the full spectrum of
Lonn M. Kiel
(10) (10) (2.5) (7.5) (10) (2.5)
growth. We need to attract their children back to Minnesota. Maybe
some monetary incentive if your folks are in a nursing home.
5. Too smug? In a
storm you need a strong rudder in order to keep facing the waves
head-on. This storm is persistent and we will never reach the other
side until the wave of boomers wane. Are many building their
retirement nests here because of our second to none medical care?
Maybe we should expound on that.
6. Vision. Every
board and panel needs to have a microscope and a telescope. It seems
that Minnesota has been peering through the microscope for too long.
If we incorporate the telescope into the answers we must make sure
that we constantly move it to different locations otherwise we may
miss "stars" of ideas and opportunities.
D. (Bill) Hamm
(10) (10) (10) (10) (0) (7.5)
1.The problem. The
challenge to do what is best for the people over what is best for the
parties has never been greater, while the political parties
self-importance has undermined any real change.
2. Outlook. If the
socialist progressive crowd does not come to the realization that
government alone can not tackle this immense problem without private
sector support and new community based efforts they will drag us all
in the sewer.
growth. Real Quality education coupled with maintaining the strongest
possible job creation climate must happen or we will slide steadily
into third world poverty.
This can only be obtained by moving as much decision making back to
local control and away from the centralization of control and power
model we have been following for years.
5. Too smug? I
think you’re mistaken, it isn't Minnesota’s people who have become too
smug, it is Minnesota’s political party leadership who have become too
smug and locked in unsustainable rhetoric.
6. Vision. If
this is statement is a push for more socialist centralization of
control and power I stand against it. If on the other hand this is
about invigorating and empowering our citizen base while pushing as
much decision making as possible back into the hands of local decision
makers, then it has my support
Tom Neuville (9) (9) (5) (8) (8) (8)
understand Question 3. Government doesn't "invest" and I don't know
what "moral obligations" are intended in the question.
Joseph Mansky (10) (10) (10) (10) (10) (10)
6. Vision. I
agree totally with Tom on this and his view that incrementalism is a
major problem for us to confront. The question is this: assuming we
survive the storm and make it to port, do we re-rig the ship? Or build
a new and better vessel?
Edward Dirkswager (10) (10) (10) (10) (10) (10)
The question is
who are the leaders that should sit down to create the vision. I'd
argue that it must include, but not be limited to, the Governor and
legislative leaders otherwise it will go nowhere. This needs to be a
hands-on discussion--no sending others to stand in. I'd do it over the
summer. This also will not work unless there is a very good
"marketing" plan to lay out the ideas to the general public. The
problem is much more complicated that just saying that the leaders
don't have a central vision. The public is influenced by leaders, but
the public also has great influence on the leaders. Minnesotans do not
see themselves as a common community as they once did. In my opinion
this is the most fundamental problem.
Brent Olson (10) (10) (10) (10) (10) (10)
William Kuisle (8) (10) (8) (8) (8) (9)
Ray Cox (10) (10) (7) (10) (10) (10)
We need to step
back, look hard at many of our programs, and have thoughtful
discussions about them to see if they are things government should be
doing, and if so, is there a better way to deliver the service. A good
example is long term care insurance…the silly little tax incentive
does not do anything to encourage people to secure long term care
insurance---so the result is everyone thinks the state will take care
of them in old age. Couldn’t we work with private insurers to develop
a life insurance plan that converts to long-term care insurance at a
set age? Or figure out some workable way to get more people with
insurance or the means to care for themselves in old age.
We need a sunset commission to examine programs that have been put in
place to see at what point they can be eliminated. It makes no sense
to create programs that go on forever, essentially unchecked. Every
program in Minnesota should have a goal of putting itself out of
business at some point.
Norman Carpenter (10) (10) (0) (8) (5) (10)
Legislation is not
"moral." The use of "moral" in that context debases the word. We as
individuals may have moral responsibilities, but the state as such
does not. Politicians use "moral" to support their partisan arguments
-- as do preachers and social scientists. And searching for "vision
statements" is another excuse for inaction. The numbers are
unassailable ...let's get to work.
Wayne Jennings (7) (8) (3) (7) (7) (8)
Shari Prest (10) (10) (10) (9) (3) (10)
Who would serve on
this visioning team? I hope there will be representation from experts
as well as just plain people with insights, experiences and wisdom. It
cannot be a partisan group, and that is very difficult to avoid.
Quie (10) (10) (10) (10) (10) (10)
Facing the 25-year
impact of demographic change, we ought to begin now in organizing
seniors, especially in working with children so all can be reading
proficiently when they start 4th grade. Seniors will cost less and
young people will be more productive, a great help to the economy and
fulfilling our moral obligations.
Yesterday produced a sorry omen. The Governor and legislature acted
like my brother and I as small children, pointing our fingers at each
other in a spat to get an advantage over the other. The problem is
that the citizens are the only ones who can act as parents and we are
not unified. Thank you to the Civic Caucus for assuming a parental
role. Thank you also to Tom Gillaspy for his clear headed and fact
Ralph Brauer (10) (10) (2) (8) (10) (10)
The comment about
the difference between spending and investment should be required
reading for all legislators.
Bert Press (0) (5) (10) (0) (5) (10)
Lyle Hovland (8) (7) (8) (9) (10) (10)
positions seem to be so rigid, at the expense of finding solutions to
the existing problems by working together. Real leadership is needed
and compromise is imperative.
Will Shapira (10) (10) (10) (na) (10) (10)
How is any of the
above and more going to get done when politics trumps the commonweal
with both parties guilty?
Vici Oshiro (na) (na) (na) (na) (na) (na)
Should Gov. Dayton
want a candidate for SWOT analysis I suggest Elizabeth Kautz. She led
such a process when she became mayor of Burnsville and I believe her
term as President of League of Cities has recently expired. I have
not cleared this suggestion with Elizabeth.
Robert J. Brown (10) (10) (5) (10) (10) (10)
Terry Stone (10) (10) (10) (10) (10) (10)
George Pillsbury (10) (10) (5) (10) (10) (10)
Question: Can the
largest State Senate in the US and a bicameral Legislature do the
Mina Harrigan (10) (10) (10) (8) (8) (10)
Arvonne Fraser (9) (10) (10) (7) (10) (9)
I worry if the
leadership group is a bunch of "wise men." One test will be the
gender makeup, but also you want people of courage who aren't
promoting just their interests. Make sure there are people from
within government--and I don't mean just elected officials. Find
people with new ideas, who like innovation but also respect and
understand government. Gamble on a few who aren't already "respected
leaders in the community."
Tom Spitznagle (7) (9) (7) (8) (8) (9)
Chuck Lutz (9) (9) (10) (10) (8) (10)
Alan Miller (5) (8) (3) (3) (8) (8)
Paul and Ruth Hauge (8) (9) (10) (9) (9) (10)
Fred Senn (10) (10) (10) (10) (10) (10)
How do we make this a more public debate? How do we create a sense of
urgency around these issues?
Lyall Schwarzkopf (8) (10) (10) (9) (8) (9)
This is a very
insightful presentation. Every person in Minnesota needs to
understand what Gillaspy said. We need to get the political
leadership in the House, Senate and Governor to work together to carry
out the ideas of Gillaspy.
Roy Thompson (8) (8) (6) (7) (9) (8)
Bright Dornblaser (10) (10) (8) (10) (10) (10)
growth. Statement should be, “MN high productivity needs to be joined
with a culture of some concern for the disadvantaged to be the most
attractive state in which to grow economic capacity.”
Don Fraser (9) (8) (9) (8) (9) (9)
A first rate
John James (10) (10) (10) (10) (10) (10)
6. Vision. (This)
is in no small part the Governor's job. We will know in a few days
how Governor Dayton sees it. I think you should see what he proposes,
make a judgment as to whether it is adequate to the situation, and
then decide what to propose. It would, for example, be a very good
thing to get the Governor to lead the call for a group doing a SWOT
Carolyn Ring (10) (10) (8) (8) (10) (10)
For far too long
the state has functioned the same way with the same departments, the
same budgets, adding dollars every year, and no long-range vision.
Especially, with all the new technologies and communication
innovations, there is no reason for "business as usual." Adversity
sometimes makes for prosperity. Minnesota has the opportunity to do
this. We need leadership, leadership, leadership with the ability to
get the job done!
Tom Triplett (na) (na) (na) (na) (na) (na)
doesn't apply directly to the "Tom's" on their critically important
statements. But the following WSJ article from today suggests some
growing support for the ideas I expressed a few months ago at CC: MN
state government should in fact reduce state aids to local governments
as part of the overall budget solution. The reduction should be down
to a true "equalized" level (and nothing more). Then, the state
should expand the ability of local governments to broaden their
revenue bases so that raising property taxes would no longer be their
Keep up the great work!
Tom Swain (10) (10) (8) (10) (10) (10)
RogerA Wacek (10) (5) (5) (5) (10) (10)
Politicians & most
people are in a state of denial. In 2008 there was an energy led
collapse of the global economy from which there will be no recovery!
Carl Jung, one of the fathers of psychology, famously remarked that
"people cannot stand too much reality". For ideas on how to deal with
the unprecedented problems we're facing read "The Party's Over: Oil
War & the Fate of Industrial Society"