As predicted by yours truly about this time a year ago, the DFL squandered a $18B “surplus” [1]<\/p>\n\n\n\n
The DFL is contratulating itself that it still has a surplus of a couple billion dollars – which is a little like jumping from the top of the IDS building, opening your eyes and seeing the 20th floor, and thinking “Hey, I’m at the 20th floor, I guess I’m OK”. <\/p>\n\n\n\n
The DFL has spent the state into debt<\/a>. <\/p>\n\n\n\n Minnesota passed a humungous budget in the last session. To make that possible, they drew from other funds well outside of general funds, such as special revenue funds and money from the federal government.<\/p>\n\n\n\n For Health and Human Services spending, for example, lawmakers loosened eligibility and working requirements for cash assistance programs. The cost of these changes \u2014 which is about $50 million \u2014 is currently being funded by federal TANF dollars until the 2027 fiscal year.<\/p>\n<\/blockquote>\n\n\n\n And it’s actually much worse than that:<\/p>\n\n\n\n Once the state starts paying for these with state dollars in 2028, spending will go up. And if current events are any indication, the cost of these new changes will likely have blown past $50 million by then.<\/p>\n\n\n\n Additionally, lawmakers also allocated over $2 billion in extra funding to Medicaid. Until 2027, over half of the money will come from the Health Care Access Fund (HCAF) \u2014 a special revenue fund that has historically been used for MinnesotaCare. If at any point in the future, HCAF cannot sustain this new Medicaid spending, it will have to be shifted to the general fund.<\/p>\n<\/blockquote>\n\n\n\n And, go figure – the economically-illiterate DFL have killed a bunch of the golden geese (aka ripe suck citizens) that usually pay <\/em>for DFL gigantism:<\/p>\n\n\n\n For one, Minnesota heavily relies on income taxation. But our income tax system is highly progressive. So, the state disproportionately relies on a small portion of the state\u2019s high-earning individuals, which is in itself a problem.<\/p>\n\n\n\n Unfortunately, this problem was made worse last session, when lawmakers passed targeted \u201ctax cuts\u201d that have eliminated or reduced income tax liability for select taxpayers, such as social security income recipients and low-income parents with children. This has narrowed the individual income tax base even further.<\/p>\n\n\n\n And let\u2019s not forget that high-income earners have already been fleeing Minnesota<\/a> and going to low-tax states like Florida.<\/p>\n\n\n\n\n
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