In Minnesota Shutdown, Wider Budget Conflict Comes to a Head

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“We will not saddle our children and grandchildren with mounds of debts, with promises for funding levels that will not be there in the future,” said the Republican House Speaker, publicly feuding with the Democratic executive over how best to trim yawning deficits. “This is debt that they can’t afford. It’s debt that we can’t afford right now.”

If you’ve been listening to Republicans in Washington recently, that might sound very familiar. But John Boehner didn’t say it. Kurt Zellers, the Speaker of the Minnesota House of Representatives did. The midwestern state is in the midst of a ferocious budget battle that shuttered government buildings on Friday and left some 23,000 public employees temporarily without income. As with federal wrangling over the debt ceiling, Democrats and Republicans have agreed to significant spending cuts, but are at loggerheads over the inclusion of tax increases, specifically those on high-income earners. Both sides are digging in, hoping to use the political drama to tar their foes and sell voters on their respective governing philosophies. The impasse marks something of a trend.

The 2010 elections radically remade Minnesota’s government. While Mark Dayton squeaked by his GOP rival to win back the governor’s mansion for the Democratic-Farm-Labor Party, Republican candidates rode a tide of conservative enthusiasm to stunning victories in the legislature. For the first time in four decades, the GOP took control of both chambers. And new, more rigid political attitudes dominated both parties. Of course, divided government is not a new phenomenon in the North Star State. The lingering $5 billion shortfall is a holdover from Republican Tim Pawlenty’s years as governor, when Democrats controlled the legislature. But hardline ideological warfare taken to the extreme of a shutdown is a novel thing for a state long known for its cooperative and compromising politics. “It’s bad moment for Minnesota culture,” University of Minnesota political scientist Lawrence Jacobs says, “a crisis of governability in a place you wouldn’t expect it.”

One possible culprit is the proliferation of strict anti-tax campaign pledges taken across the country during the Tea Party fueled elections of 2010, which ushered a vast number of orthodox conservative candidates into local offices. Even taking that into account, budget impasses are unusually widespread. As states’ fiscal years came to a close on Thursday, 11th hour deals were still pending in Iowa, Oregon, Delaware, Pennsylvania, Rhode Island and Massachusetts. In Connecticut, legislators debated until 2:30 in the morning, finally voting to give Governor Dan Malloy new deep budget-cutting powers by narrow margins. The result in Minnesota has been bruising political showdown.

In drawing the kind of public scrutiny that comes with a shutdown, Democrats and Republicans are hoping to convince voters that their vision of government is the right one. Republican legislators have been unmoving on the issue of taxes,  reportedly rejecting a deal that raised revenues only from the 7,700 Minnesotans who make $1 million or more a year. For Governor Dayton, the withdrawal of services presents an opportunity to remind voters of the role government plays in their everyday lives, and accuse Republicans of merely protecting the interests of the wealthy. In holding the line and allowing a shutdown, both sides are waiting for public opinion to turn against their opponent. In a way, everyone is getting their wish as approval ratings for all parties plunge. But the stakes are probably greater for Republicans legislators, many of whom face re-election in Democrat-majority districts in 2012. Dayton won’t face another test at the ballot box until 2014.

The political implications could also ripple beyond Minnesota’s borders. Pawlenty’s presidential campaign has gotten off to a rough start with a widely panned debate performance, little movement in the polls and underwhelming fundraising numbers. The shutdown throws a spotlight on the fiscal situation he left the state at the end his term. As with many state budgets, Minnesota’s deficits are structural, and Pawlenty inherited a problematic budget himself. But Pawlenty used some of the usual gimmicks — like dipping into rainy day funds and borrowing from future revenues — to get through tough years in his tenure. And the situation raises the kind of questions his campaign doesn’t need right now.

In the broadest sense, Minnesota’s shutdown is indicative of the times. The economic downturn has shrunk state and federal tax receipts alike and both levels of government are grappling with how to stem the flow of red ink. “What’s going on in Minnesota is a microcosm of the national debate,” Jacobs says. In that state, Democrats and Republicans have allowed a radical and unprecedented lapse of government. As the deadline to raise the federal debt ceiling fast approaches, it’s worth pondering how far President Obama and  congressional Republicans are willing to take their conflict.

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