The Shell Game

The biggest scam in Minnesota politics?  The intertwined three-card-monte game the DFL plays with state Local Government Aid (LGA), county and city taxes, and city budgets.

LGA, for those who weren’t paying attention, was instituted in the sixties and seventies to transfer wealth around Minnesota.  Back then, it ensured outstate towns and school districts got enough money from the economically-thriving Twin Cities to support more spending.  Today, it allows the metro governments – Minneapolis and Saint Paul – to launder their spending through the state, and get the parts of the state that are able to pay their own way to subsidize it.

It’s a very handy political tool.  It allows city governments to spend like crack whores with stolen gold cards, of course, and hide the spending under a mountain of state money.  And for the savvy mayor, paying for essential services with LGA while paying for things like Human Rights offices and $50,000 water fountains gives one incredible political leverage; using the money the city actually controls to pay off special-interest constituencies (neighborhood coalitions, toney arts organizations, unions) with the sure thing money, and using the state money – which is out of the mayors’ control to some extent – as a bludgeon to keep the peasants voters in line.

I noted this during the last budget cycle in Saint Paul, when Mayor Coleman’s annual trifecta of announcements  – “taxes are rising”, “we’re laying off firemen” and “damn you, Tim Pawlenty” – have become a tradition as revered as the Winter Carnival.

Walter Scott Hudson – at True North and at his blog, Fightin’ Words – isn’t fooled, either:

Employees of the City of Minneapolis were advised Tuesday of the “extremely damaging” effect Governor Tim Pawlenty’s proposal to solve a $1.2-billion budget deficit could have on “core services.” Pawlenty’s plan would “take another $29 million out of Minneapolis’ 2010 budget,” an e-mail from Mayor R.T. Rybak and City Council President Barbara Johnson stated. On top of $21 million in previous aid cuts, the governor’s proposal would “represent a 56% cut in the Local Government Aid that Minneapolis was supposed to receive from the State in 2010.”

The text of the e-mail seems intent to incite the passions of city employees, and direct those passions toward St. Paul. This came as members of the public employee union AFSCME, a member organization of the AFL-CIO, gathered at the capitol to rally for a budget which “promotes job growth and preserves funds for local governments and state welfare programs.” Pressure is on state legislators to reject the governor’s proposal and keep cities and counties on the dole.

Read the whole thing.

It’s just as conservatives have always said; once our cities get dependent on welfare for more than a generation or two, it’s very hard to get off it.

But with the national economy continuing its Obama swan dive and the state and national moods swinging strongly againt NeoCarterism, I have a hunch the Twin Mayors are in for a rude awakening.  If not this session, then soon.

9 thoughts on “The Shell Game

  1. In December, I rallied a few of my neighbors to attend a meeting of our city council and demand they justify their proposal to increase our property tax by the max allowed amount.

    It’s amazing what effect even a relatively few, angry constituents can do!

    Not only did they agree to reduce the increase by more than half, they admitted that they knew loss of LGA would not be a viable excuse next year.

    The dim-wits that elected Rybak and Coleman made their own beds. They say they are happy to pay, and I’m happy to let them. LGA is a scam, just as Mitch says. Anyone that falls for the specious pap being offered by the Party of Scrubs is not intelligent enough to be taken seriously.

  2. This shell game has been one of my biggest complaints about the taxation in this state, since I moved here.

    The control on budgets that is exercised by the those who set the spending having to collect it from their citizenry.

    Under this system, cities and schools can spend and not worry about whether the new program will cause them to have to increase property taxes. And when they don’t have enough money, they point to the other guys, the state, and say ‘they don’t give us enough, or they cut us!’, without ever questioning on what they are spending the money they do get.

  3. This is just the tip of the iceberg, Mitch. I have long noticed that Democrats have done this from the national level all the way down to the local governmental level for what ever political mission they undertake. And when that doesn’t work the bureaucracy dominated by Democrats, interpret laws and policies the way they want them to be implimented.

  4. Sorry, but “Party of Scrubs”?

    I may need to have that one explained to me (google didn’t help).

    I agree that LGA may have been sold originally as a way to help poorer communities ensure that they could maintain “essential services” (the list of which just keeps growing) but the reality is that it’s (become) a way for local officials to spend beyond the means and willingness of their constituents to pay for projects and services.

    That’s equally true IMO of a lot of earmarks, federal grants and aid to States both directly and indirectly.

    When people say that government “needs to learn to live within its means” they usually seem to just be talking about whether it’s running a deficit or not. I think that an essential part of the test is whether level of government that’s providing a particular project or service is the one that’s actually going to its constituents to fund it or whether they’re passing along the costs to someone else.

  5. Pingback: Biggest Scam in Minnesota Politics? « Interned In Northfield

  6. “Party of Scrubs” is my own invention, thorley.

    It’s meant to be a slightly less offensive way of describing a political party comprised almost completely of life’s lowest common denominators than, say “a bag of leftist assholes, with all the good ones picked out”.

    AssClown would recognize them as The Democrat Party.

    I fully expect the term to go viral any minute now and am waiting to hear from Oprah.

  7. Right or wrong, something has to make you scratch your head when local Republican officials (former GOP State Senator now Mayor Kleis) are just as frustrated:

    Deeper cuts

    St. Cloud and Stearns County officials say Pawlenty’s proposal likely would force them to reduce basic services again, on top of deep cuts they’ve already made.

    St. Cloud’s leaders cut 10 percent from the city’s 2010 budget after losing more than $5 million in state aid since late 2008, Mayor Dave Kleis said Monday. Pawlenty’s proposal would reduce state aid to St. Cloud by an additional $4.97 million through the 2011 fiscal year.

    Such reductions may help Pawlenty maintain his no-new-tax stance, but that approach simply shifts government costs to cities and counties, Stearns County Board chair Mark Sakry said.

    “It may look like a good sound bite when you run for president, but it’s not helping the local taxpayers,” Sakry said.

    He also had more to say on At Issue this AM. I am not surprised that the Far Right is booby trapping themselves, but it is becoming increasingly clear, that those who are true Center Right (not those that think they are like the writers of this blog) are starting to reconsider this ‘cut to the marrow’ philosophy.

  8. I do think we have a tax/spending equity problem, out-state vs metro, even within the layers within the metro. But even if LGA did address this once upon a time, it was long since hijacked as you detailed.

    A real fix would start by assessing why we have over 1,400 units of government in this state. And a real fix would give no LGA to Mpls at all, which seems able to raise well over $1 billion without it.

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