Gridlock definitely makes for some exciting headlines... Any thoughts on these?
My only thought is that all this talk of cuts when the budget is growing is fascinating... It is amazing to me that the GOP can't make better use of that info.
Parents United: Gov Dayton's Letter
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Minn Post: Chambers of Commerce want LGA
Parents United David Jennings OpEd
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I've seen the GOP make the point of overall spending going up many times, but only on talk radio and the blogs. The Star Tribune, WDFL, et al are still sticking to the DFL baseline / drumbeat against which everything is a cut.
After researching the state budget I have concluded it is too damn complicated and makes no sense. To me spending should go up by the rate of inflation and also increase to reflect increases in population and changing needs. I think all the shifts and gimmiicks under Pawlenty have contributed to the appearance that a 22% increase is needed to prevent a $5 Billion deficit and drastic cuts.
According to the MN numbers, total expenditures were expected to be $31,188,123,000. If the GOP goal is staying under $34,000,000,000, that means the increase is already at 9% !!!
Now that is more than my raise this year... How about yours?
I hope they are shooting for only$32.7 BILLION... That would still be a noticeable 5% increase.
G2A Budget 2
GOP numbers convince those who want to be convinced. They want to turn budget discussions into a dispute over semantics.
Sure spending is going up. So has the the cost of what we have decided to spend money on. We either have to increase revenues, or change the spending decisions we have made, or both.
--Hiram
We are increasing revenues...
Now what are the Democrats willing to do to improve Government efficiency and productivity?
Just sending the System/Monster more money will not motivate bureaucrats to change and improve... It will incent them to just ask for more...
Which we really can not afford on a year after year basis. If incomes go up by 3% and cost of governement goes up by 10%, it is only a matter of time before we have a serious problem.
In fact, since as we discussed previously. MN cost of government has increased by ~8.5% annually since ~1960... I am pretty certain that incomes have not kept up with this rapid pace. No wonder we have challenges.
Assuming a $34,000,000,000 budget and 4,500,000 people... That means it costs $7,555 per man, woman and child. That is incredible !!!
"Now what are the Democrats willing to do to improve Government efficiency and productivity?"
I am open to suggestions. In my interactions with the state they are more efficient than they used to be. The actual cost of state government is about a billion bucks so if we got rid of it altogether we would still have a four billion dollar deficit. What I find interesting is that this implicit assumption that more efficiency and productivity would save money. The state is essentially a revenue transfer system. If they did their job better, they would transfer more, not less, and the overall cost would go up, not down.
"If incomes go up by 3% and cost of governement goes up by 10%, it is only a matter of time before we have a serious problem."
Sure we have a serious problem. I have power points on the subject. Our costs are going up faster than our incomes. So what do we do about it? Find ways to increase our incomes, and lower our costs. But where the state is concerned, among the many problems is that income and cost are not independent variables, they in fact bear a reciprocal relationship. As incomes stagnate or go down, the cost of government goes up, as people shift the burden of what they can no longer pay for to the government, particularly health care.
--Hiram
about John's comment:
"In fact, since as we discussed previously. MN cost of government has increased by ~8.5% annually since ~1960... I am pretty certain that incomes have not kept up with this rapid pace. No wonder we have challenges."
My chart that goes back only 20 years show that increases in govt spending have not kept up with aggregate income as compared to the 90's. In the last 10 years govt revenues/spending have risen roughly in proportion ito income gains.
price of government chart
price of government graph
The chart show revenue increasing more slowly than income in the next budget year, which maybe another indication that we need more revenue and cannot provide the same level of service with the anticipated revenues. Like I said earlier it is all too complicated for me.
The chart shows an avg yearly govt revenue increase over the past 20 years of ~4.4%. (1991: ~$14 billion, 2011: ~$34 billion) Seems about right, a bit more than CPI...
It says MN personal incomes have increased by ~4.9% per yr. (1991: ~$88 billion, 2011: ~$229 billion)
The funny thing is that I do not understand where they get the personal income number? And why it bearly decreased during our recent recession.
The numbers would show that gov't has been doing pretty good... But do you think our incomes have been going up faster than inflation?
From all the headlines, I thought incomes were falling. Maybe all the public employees on contract and the those on gov't programs are keeping up the income number... Wouldn't that be the dog chasing its tail...
Teacher's incomes have not been going up faster than inflation, especially the last ten years.
Maybe the recession hits some income levels harder than others. Progressive blogs have made a huge point of how well the wealthy have done over the last thirty years.
This chart, Family income growth in two eras shows real income growth for all but the poorest quintile, but much more growth for upper income families.
As for Teacher's incomes... The point was not that they were going up. The point was that they did not go down during the recession. Nor did many public employees get laid off.
Where as many employees were laid off or lost their profit sharing and/overtime during this period. This should have resulted in a 20+% income reduction, which does not show up in the numbers. The stock market sure was not making up for the loss of earned income.
By the way, are you sure Teachers Total Compensation has not been going up faster than inflation? How much have the cost of benefits earned by the Teachers been going up? (ie salary + benefits = TC)
Here is my theory on your latest graph... Everyone's income should be going up as fast as the upper income folks. The problem is that we citizens have chosen to buy most of our products from low cost country manufacturers. Thus all those great jobs that did not need a college degrees just fluttered away. (the illegal immigrant tolerance isn't helping either)
A side note: I work with companies that do road construction. One of their biggest concerns getting and maintaining good employees. It seems they have a hard time finding people that want to do the physical labor that pays pretty well..
John,
I think your ideology is contributing to a blind spot in your inability to see a problem in an economy where so much income goes to the top 1%.
As the EPI site shows: when income grows who gains from 1991 to 2008 average incomes in the US grew by $9,673 but only 12% of this went to the bottum 90%. I did the math, that's an average of $1290 (about $75/yr) to those in the bottum 90%. During that same time span the elite 1% made about $530,000.
No wonder Gov Dayton advocates for $1.5 Billion in new revenue with a slight tax increase on the top 2%.
more interesting graphs on inequality
Maybe it is unrealistic to expect growth rates like those following WW2. It is a finite planet with a growing population after all. But we could have shared prosperity. I blame the Waltons much more than I blame Walmart shoppers for our modern economy.
I have been skim reading a book by Charles Murray, that is in part about educating the elite to be more virtuous leaders. Maybe they could learn to apply Paul Welstone's motto "we all do better when we all do better"
Remember that the Waltons and other business owners are motivated by growing the company. (ie profit) To support this goal, they will provide the products and services that their customers want to buy.
Their customers wanted inexpensive high quality products, regardless of where the company was based or how many American jobs were lost, therefore Walmart grew by meeting this need.
If the customers had demanded American built goods from American companies, even if the cost was somewhat higher, this is what Walmart would have provided.
So ironically, the poor and middle class shoppers are the folks that truly chose to send their jobs over seas. All those folks that want the best value for themselves, no matter what it costs our society. (or themselves...)
Thus my interest in buying more often from American companies that manufacture in the USA... I would rather be part of the solution rather than part of the problem. Even if the product is a bit more expensive, not quite as reliable and less fashionable.
As for taxing the rich... Just remember that they are already paying the majority of the bill. I'll have to post again soon on why the poor are poor. If are first shot at it holds, do we really want to subsidize people that make stupid life choices. More later...
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