The Dayton Dustbowl: Blood From A Turnip
Thursday, September 9th, 2010Paul Demko, writing for Finance and Commerce, reaches many of the same conclusions that I reached on Tuesday’s series fact-checking the Dayton budget “plan- and comes up with one that I missed :
The final plank of the DFLers tax-the-rich proposal involves a crackdown on tax deadbeats. According to the Office of the Legislative Auditor, roughly $1 billion in taxes goes uncollected each year. During the last biennium, the state revenue agency spent $20.2 million to collect $133.7 million in outstanding taxes, a return rate of $6.60 for every $1 spent. Dayton’s plan counts on collecting an additional $400 million in unpaid taxes by upping the enforcement budget to $60.6 million, theoretically netting the state approximately $340 million.
But financial experts see a problem with that calculation: The rate of return on enforcement activities is almost certain to drop as more tax scofflaws are chased down.
Demko, being a liberal partisan, pays the plan his complients and takes a whack at Emmer as well. But our bottom lines are pretty much similar:
The bottom line on Dayton’s proposed plan to make the state’s richest residents pay their fair share of taxes? It’s unlikely to result in $4 billion worth of additional revenues for the state.
Now, the DFL’s been howling for months about Emmer’s lack of a “plan”; Demko is no exception:
Even so, financial experts give the DFLer high marks for actually presenting a reasonably detailed plan for solving the looming cash crunch. By contrast, Republican nominee Tom Emmer has yet to provide a credible breakdown of how he’d balance the state’s books, although he’s ruled out tax increases.
Of course, the party out of power doesn’t need a complete plan with perfectly-dotted-I’s and crossed T’s. They need a vision that convinces people they have a better idea. The plan matters next February.
Still, Dayton’s not getting quite as smooth a ride as one might expect.
Gary Gross also commented on Demko’s piece.
The reporters who’ve been reflexively characterizing Sen. Dayton’s plan as detailed didn’t do their homework. In fact, I’d argue that serious people couldn’t characterize Sen. Dayton’s submission as a plan, much less a detailed plan.
We’ll keep working on it…







