How should the media be reporting the state's budget problems? When the latest state revenue forecast came out this week, most news organizations reported that the projected shortfall went from $700 million to $466 million. Some, including MPR, the Pioneer Press and the Star Tribune, said that the shortfall had been reduced by a third in the updated projection. And that seemed to get the goat of former state Finance Commissioner John Gunyou. He fired off this e-mail to many political reporters in the state:

On behalf of all the finance professionals who have fought for years to keep the forecast nonpartisan, I'm asking you to please help your readers and listeners discern the facts from the spin.

A $234 million forecast improvement does NOT slice our $1.4 billion deficit by one-third. In fact, Finance is also now reporting that inflation is higher, so that previous $1.4 billion problem is still close to $1.3 billion. Peggy and Stinson are absolutely right when they caution folks not to get all excited. It would immeasurably help the debate if you would use the statements of the professionals in your leads - not those of the partisans.

The "Peggy and Stinson" Gunyou refers to are current state Finance Commissoner Peggy Ingison and state economist Tom Stinson. We should note that most in the media did mention the inflation factor, and that in fact it is the forecast done by the professionals that gives the $700 million and $466 million numbers. If you don't believe me, take a look.

State law actually says that inflation in spending should not be included in the forecast. The law was passed when both DFL Senate Majority Leader Roger Moe and GOP House Majority Leader Tim Pawlenty were both thinking about running for governor. Now that Pawlenty actually is the governor he stands by the decision not to include inflation. And now that Roger Moe is no longer in the Legislature some top DFLers in the Senate, most notably Sen. Dick Cohen, are pushing to change the law back to including inflation in the forecasts.

It's interesting to note that the $4.5 billion shortfall of two years ago also did not include inflation.

Speaking of the budget forecast, one of the key questions raised by the budget professionals related to Minnesota's job climate. The forecast showed Minnesota lagging considerably behind the national average in terms of job creation. MPR's Jeff Horwich had new information about the job picture in the state:

On Tuesday, state economist Tom Stinson was announcing a state revenue forecast which presumes strong economic growth and 44,000 new jobs in 2005. But Stinson, a University of Minnesota professor and non-political appointee, expressed concern that state job growth last year had been weak and even declined at times.

"The question is: how do you explain what we've observed here, this decline? And that's a puzzle to us," Stinson said.

Just a day later, those jobs numbers Stinson had been working from shifted. It doesn't solve the puzzle, but it does change the picture. Minnesota added a lot more jobs than previously estimated. Instead of creating 23,400 jobs last year, it turns out the Minnesota economy added more than 38,000 jobs -- an improvement of 64 percent.

The difference comes from the way data were collected. The initial estimates are based on business surveys done month to month. Some time later, the state gets the actual numbers for how many jobs companies added. These revisions happen every year; this time, the difference was significant.

"I think we are showing a great deal more momentum," says economist Steve Hine, the top labor analyst for the state Department of Employment and Economic Development. "We've built up a greater head of steam heading into 2005 than we had previously thought, which does bode well, I think, for the outlook. I think this report generally does provide reason to be more optimistic about job growth in the coming year," he said.

If all those new jobs are created in the next few months does it mean that the projected shortfall will really be one third smaller? Ask me in two years!