As we prepare for the 2020 elections, we should reflect again on the tragedy of Detroit’s bankruptcy (July 18, 2013). Then MN GOP Chair Keith Downey’s “Three Lessons” from that event sound a warning for MN now. As explained below, Detroit’s failure was due to 1) High Taxes, 2) One-Party Rule and 3) Corruption.
It is telling to consider whether our Minnesota DFL governor and House legislators learned anything.
On July 18, 2013, the city of Detroit, Michigan, filed for Chapter 9 bankruptcy. It was the largest municipal bankruptcy filing in U.S. history by debt, estimated at $18–20 billion. Detroit is also the largest city by population in the U.S. history to file for Chapter 9 bankruptcy.
From a peak of 1.8 million in 1950, the population of this once-great city was reported by The New York Times to have dropped by July 2013 to "700,000 people, as well as to tens of thousands of abandoned buildings, vacant lots and unlit streets."
Six years ago, Keith Downey reflected on three lessons policymakers should take away from the Detroit bankruptcy. Let’s look at Keith Downey’s Three Lessons :
Lesson 1 -- High Taxes. The most important lesson is understanding why Detroit failed. Governments receive most of their revenue from taxes. Taxes come from the local economy. A tipping point was finally reached when well-meaning liberal policies outweighed the taxpayer’s ability to pay and government leaders could not say “no” to the spending. Eventually, enough businesses and taxpayers left the core city, decimating their tax base until they could not pay for all of the things they wanted the government to fund.
The question for Minnesota policymakers is “Where is our tipping point?” Over the past six years, Republican leaders in the legislature have forced first Gov. Dayton and then Gov Walz to say “no” to some of the spending the DFL has sought in order to balance the budget without raising the taxes. We all know now how this has turned out – low unemployment, more jobs, increased funding for schools, higher consumer confidence and increased revenues to the state treasury.
With one exception. In 2013, when the DFL had a majority in the House and Senate, nobody in state government said “no.”
In an article in the Sunday, August 11 edition of the Star Tribune (front page, Minnesota section) entitled, “Owner uses MOA as project collateral”, Eric Roper wrote about the 49% stake in MOA that the Triple Five Group pledged as collateral to secure the construction loan for their New Jersey mega-mall. “This leveraging of MOA came as a surprise to Bloomington officials, concerned that the megamall makes up about 10% of the city’s tax base.
The article goes on to quote Baltimore-based retail consultant Nick Egelanian, “They are making a huge bet on American Dream and obviously putting part of the Mall of America at risk in it.” He noted that the Triple Five Group is banking on high-profile attractions to stimulate retail sales, and there’s no agreement among the industry experts he consults with about whether it will work.
Eric Roper noted that “tax dollars would pay $50 million for a parking ramp and skyway to the mall, as well as up to $8 million to clean up the site.” The article did not make clear if these figures include the $20 million that the city has paid as its share of the water park design effort. It is important to note that Bloomington tax payers are also being asked to consider more than $50 million for a community center.
In an opinion piece in the Thursday, August 15 edition of the Star Tribune (front page, Business section) entitled, “Financing for MOA water park is baffling”, Lee Schafer wrote, “Taking on the risk of a big entertainment venture isn’t a typical burden for local governments anywhere … The problem is that the water park – which would cost about $250 million just for construction – does not seem viable with private market money.”
Schafer points out, “if you need a nonprofit to own what sure looks like a private entertainment business that can’t be financed in the private capital markets, you can simply rent one. If you need a public agency to issue the bonds that will finance the deal, one of those can be rented, too.” So the City of Bloomington is proposing to have a Wisconsin agency issue tax-exempt bonds to finance an entertainment project in Minnesota owned by a special-purpose affiliate of a Louisiana non-profit. And Bloomington would back all of this up by imposing additional sales and use taxes at the Mall of America that would kick in to cover any shortfall in cash flow.
So more taxes may have to be paid by tenants at the Mall of America to help attract.more visitors to the Mall of America. As Lee Schafer concludes, “Is everybody really OK with all this?”
In May, one of our readers wrote to Sen. Melisa Franzen asking why the Minnesota legislature was approving more funding to the University of Minnesota, especially when the University openly intended to give money to non-citizens for tuition. Calling out the University administration statement that it is “dedicated to supporting student success, regardless of a student’s immigration status,” the reader asked Franzen why Minnesota taxpayer dollars should be spent to help non-citizens.
Almost three months later, the reader received a response from Sen. Franzen that appears to miss the point. “I understand the importance of continuing to provide strong funding to the University,” she wrote. “I am in support of increasing the accessibility of higher education to those residing in Minnesota first and also bringing talent from outside of our state.”
Franzen then seemed to acknowledge an obligation to respect the source of state-provided funding. “I am in full support of the funding for the U of M as long as it is accountable to taxpayers of the state.”
Then, turning on a dime, she concluded, “These funding decisions benefit our state as they lead to a more educated workforce fostering economic growth and encouraging businesses in our state to stay and hire local.”
Does she not realize it is a crime for an employer to knowingly hire an illegal immigrant, even if that new hire has a U of M diploma?
Our Democrat State Senator Melisa Franzen (on the left in photo) was one of six panelists invited by Rep. Ilhan Omar to speak at an Omar town hall supporting "Medicare for All." The town hall was on July 18, 2019.
Franzen's quote of the night: ". . . in my district, Senate District 49, I both have Ilhan Omar and CD5. And I have Rep. Dean Phillips in CD3. And I love them both."
Somehow, after 7 years as our State Senator, we expected a bit more depth and a few solid reasons why she supports the idea of "Medicare for All". However after carefully listening to the event video and even reading a transcript, it's still unclear what Franzen's position is on the issue.
The invited panel members were: Rep. Pramila Jayapal (D-WA), Rose Roach, the executive director of the Minnesota Nurses Association, Erin Murphy, a former Minnesota House Majority Leader, Minnesota state Sen. Melisa Franzen and Dr. Dave Dvorak, an emergency medicine doctor.
The Bloomington League of Women Voters hosted a Primary Candidates Forum July 10.(Gene Winstead, mayor for the last 20 years, is retiring.) The 5 mayoral candidates and their web sites (click on links) or facebook pages (navigate to these from FB):
- Ryan Kulka is our SD49 Republicans recommended candidate, as reported in our July 1 News. Ryan is an entrepreneur, business owner and life-long Bloomington resident who has experience managing budgets and people. https://www.kulkaformayor.com/
- Tim Busse, has been on the City Council for 4 terms. He believes there is much work left do, but defended the previous mayor’s leadership and previous council activities on the $250M water park, the new community center and the river bottom trail paving. https://www.busseforbloomington.com/
- Sharon Christensen, whose background is in health services and union representation, feels she can bring needed change to the city. (FB) Sharon Christensen For Bloomington Mayor
- Rainer Einsmann is a German immigrant who served in the Army, taught high school and worked in employment services. He has two main concerns: lake invasive species and closing the MOA on Sunday to benefit small businesses. (No web site or FB page as of date of debate)
- Dan Niziolek has been involved with city government in Minneapolis and St Paul for 27 years and feels mid-course corrections are needed to solve crime, traffic, jobs, lack of citizens voice and the water park problems. Supports more community engagement by city government. (FB) Vote Dan For Mayor
Based on the audience questions selected by the League of Women Voters, the issues addressed in the debate were the $250M Mall of America water park, the cost and location of the new community center, paving of the Minnesota River bottom trail, city government transparency, affordable housing, equity, ranked choice voting.
The full video of the debate is now available. CLICK HERE to view.
Here is a summary of each candidate’s statement when asked what their top 3 priorities would be if elected:
- Affordable living -- a combination of jobs, transportation, and housing—not just minimum wage or targeting housing developers.
- Bring transparency to city government through coalitions and committees.
- Increased financial responsibility.
The consensus among attendees of the July 10 Bloomington League of Women Voters Forum for Primary Candidates is that the "At Large" City Council race is among progressives. SD49 Republicans will not be making a formal candidate recommendation.
The video for the entire debate is now available. CLICK HERE to view it.
These Four City Council – At Large candidates will be on the ballot for the August 13th primary election.
The listed campaign sites all are on Facebook, navigate from FB
• Jenna Carter: (FB) Jenna Carter for Bloomington City Council
• Brian "Clem" Clemens: (FB) Brian "Clem" Clemens for Bloomington Council
• Judy Gelina: (FB) Judith Gelinas
• Larry James Hotchkiss: tbd
Three of the four candidates’ for the City Council – At Large position attended the debate. Larry James Hotchkiss had a family situation and could not attend. Candidate responses clearly showed a progressive liberal bias.
Unlike the questions selected for the mayoral debate, there were many audience questions regarding diversity, inclusion, racial equity, sanctuary cities, and illegal immigrants.
All three of the candidates had derogatory remarks regarding Bloomington’s “welcomeness”. The candidates indicated they would not cooperate with federal law enforcement officials in advising them of illegal immigrants in Bloomington and several suggested Bloomington become a sanctuary city.
Unfortunately, Mr. Hotchkiss does not have a web site or facebook site allowing us to assess his views, so at this point we feel there is no candidate in this race who is not liberal or progressive and is acceptable to Republicans. If this disappoints you (too), please think about how you can prepare to run for the City Council in the future.
A serious statewide proposed mandate about the education of MN children requires your attention. In Spring 2019, MN House Bill HF1414 was passed by House Democrats that mandated Comprehensive Sex Eduction (CSE) in every MN School District. Although it was defeated in the Senate, CSE proponents have promised to keep the pressure on to get this mandated in the State of Minnesota and beyond. We who oppose it must stand together in full force.
We've learned that some of the controversial, explicit and graphic, material is already in local elementary school libraries.
Comprehensive Sex Education is dangerous because:
• It is a radical movement to normalize all gender identities, teach 10 year olds and up how to have all forms of sex outside of marriage, and encourage sexual behavior that will harm students long term physically and emotionally.
• It is ”a means of building a foundation for a long-term culture shift...” according to the SIECUS Strategic Framework, pdf. (Sexuality Information and Education Council of the United States)
• CSE is pushed by proponents such as Planned Parenthood and the University of Minnesota through it's Healthy Youth Development - Prevention Research Center.
• CSE removes parental rights and is all about children's rights to sexual pleasure and their sexuality, with radical messages taught beginning in PreK.
• Educate yourself with the information from the links below.
• Contact your legislators and voice your concerns about CSE
• Send emails to people with info from Child Protection League
• Plan to voice your opposition to CSE by attending:
PROTECT KIDS RALLY
Sunday, September 22, 1:30
At the MN State Capitol
Depending on which economist you believe, the state of Minnesota’s economy is either robust and moving along nicely, or struggling under the burden of bone-headed government. As in almost every debate in macroeconomics, reality is hiding under a staggering blizzard of mind-numbing statistics, and is safely resting comfortably between the extremes.
Having tipped our hats to that bit of complex reality however, it’s still impossible to deny that government in Minnesota is just not very good at getting out of our way. In their breathless passion to control everything, they just can’t let the free enterprise market economy create the wealth and welfare that ordinary Minnesotans have proven over and over to be abundantly capable of producing.
As a case in point, a recent study (for charts, View Full Report) by the Center for the American Experiment points out the fact that Minnesota’s LOWEST individual tax rate is higher than the HIGHEST tax rate in 23 other states. In other words, Minnesota’s most productive workers are literally being paid to leave Minnesota and take their skills and experience somewhere else where they can keep more of what they earn.
Also, Minnesota has the 3rd highest corporate tax rate in the entire 50 states, and as a result we have one of the lowest rates of venture capital investment in the 50 states. Between 2002 and 2017, the Minnesota stock of venture capital increased by 39%, but over the same period the U.S stock of venture capital ballooned six times more, by 249%!
Similarly, in metric after metric, the CAE study documents the growing lags behind national averages. In output per worker, in output per hour worked, in GDP per worker and even personal income per capita, Minnesota is underperforming its potential because policy discourages capital investment and takes away the workers’ wherewithal to produce.
And even more recently, an article in the Minneapolis Star & Tribune confirmed the continuing trend toward underperformance in Minnesota’s economic growth reporting that the year ending on May 31 Minnesota added jobs at an annual rate of 0.1% while the rest of the country added jobs at an annual rate fifteen times that ( 1.5%)!Read more
This week, the St. Louis Park City Council voted to stop saying the Pledge of Allegiance at their meetings. It is a vote heard round the nation. Even The Washington Post covered it, noting it did not go over well.
Why did the city council of St. Louis Park vote unanimously (5-0) to drop the Pledge of Allegiance at meetings with less than three minutes of discussion? "In order to create a more welcoming environment to a diverse community," one city councilmember was quoted as saying,
City Councilmember Tim Brausen told The Washington Post that "Unfortunately, some of us feel like patriotism has been so politicized that it's almost used as a weapon against people."
So who has politicized patriotism? In 2018, the city council approved a series of strategic priorities that includes "being a leader in racial equity and inclusion in order to create a more just and inclusive community for all." What could promote a more just and inclusive community than a pledge to defend “liberty and justice for all”?Read more
Campaign finance rules and public-subsidies that limit candidate spending may be intended to “level the playing field” but they clearly don’t, as illustrated by the MN Attorney General 2018 campaign. I believe it’s time to end the public subsidies for political campaigns.
MN Attorney General candidate Doug Wardlow’s 2018 (unsuccessful) campaign got headlines in mid-June when they were fined for “overspending”. The campaign committee’s legal counsel explained how that happened:
"The committee's legal counsel Richard Morgan said they were "overwhelmed by a surge in fundraising late in the campaign."
"Because the committee hired an outside firm to conduct much of its fundraising and compensation paid to that firm was based on the amount of receipts, the surge in fundraising caused both the committee’s receipts and its costs to dramatically increase," Morgan explained to the board.
The report notes the committee spent over $200,000 on radio and television ads in October 2018 alone, with Morgan saying the committee "did not anticipate the rapid increase in fundraising expenses and did not realize it would exceed the spending limit until after it had placed the ad buys for the final days of the campaign."
Reading other published articles about the campaign, it’s evident that Wardlow’s “overspending” was against a lower limit (base spending limit of $864,072) than Ellison’s actual spending of over 1.1 million. Reported by MinnPost: "Where spending by candidates is concerned, eventual winner Ellison raised $1.148 million and spent 1.105 million. His subsidy was $96,067. GOP-nominee Wardlow nearly matched Ellison’s totals, raising $949,203, spending $937,614 and receiving $72,252 in public subsidy.”
The most recent campaign finance handbook for candidates explains how/when spending limits may be set differently for two candidates for the same office, by as much as 30%. (Detailed excerpt is a footnote below).
In addition, outside groups / PAC’s out-spent on behalf of Ellison by 12-times, per a Star Tribune article.
“Republican candidate for attorney general Doug Wardlow also faced a significant cash disadvantage. Democratic donors to outside groups devoted far more on independent expenditures to benefit newly elected Attorney General Keith Ellison — about $1.9 million, 12 times as much money as was spent on behalf of Wardlow.”
And as also reported by MinnPost (whose deceptive headline masks the fact that DFL spending was far more than Republican.)
“Almost all of the outside money spent to help Ellison came from the DFL State Central Committee, listed as having spent nearly $1.9 million, largely on TV, radio and digital ads against Wardlow.”