Welcome to the Daily Digest, where the state's campaign finance board wants broader authority, Dayton talks taxes, and fiscal cliff talks stall.
The state's campaign finance board adopted a legislative proposal that includes higher candidate contribution limits and stricter disclosure rules.
The Pioneer Press interviewed Gov. Mark Dayton, who said he wants to lower property taxes. In return, Dayton is "considering a plan to extend sales taxes to services, which are largely untaxed now, and lowering the tax rate."
The article also says that Dayton wants to reduce the state's corporate tax rate.
Workers who provide home care to the elderly and disabled providers want to unionize.
Dayton appointed Charlie Zelle to be state transportation commissioner.
The Minnesota Attorney General reached a settlement with big debt buyer.
The Cook County sheriff has asked state authorities to investigate Cook County attorney Tim Scannell.
Hunger advocates disagree on restricting food stamps.
Around the Nation
Gov. Scott Walker has decided not to do away with same-day voter registration because it would be too expensive, Politico reports.
Politico also reports that labor groups are formulating a plan to fight back in coming elections after right-to-work legislation was signed in several Midwestern states.
Meanwhile, right-to-work supporters say they'll push the initiative in other states, the Washington Post reports.
Bank repossessions hit a 9-month high in November.
The latest census data shows that whites will no longer be a majority in US by 2043.
Democratic U.S. Rep. Keith Ellison is among those asking a federal judge to end the Senate filibuster.
Rep. Michele Bachmann accused President Barack Obama of curbing free speech to help Islamists.
Republicans and Democrats are both using the fiscal cliff as a prelude to 2014 races.
The fiscal cliff talks may go past December, Politico reports.
House Speaker John Boehner says he and Obama are still far apart on an agreement.
Boehner is trying to prevent members of his caucus from defecting on the fiscal cliff, the New York Times reports.
The Federal Reserve says it will continue to take significant measures to boost the economy until unemployment drops to 6.5%, writes the Washington Post.(0 Comments)
WASHINGTON - He may have been defeated last month but one-term U.S. Rep. Chip Cravaack has managed to see one of his bills pass both chambers of Congress.
On Wednesday, the Senate approved the Republican lawmaker's bill to eliminate the need for fishing guides on Lake Millie Lacs to get an expensive federal boating license. The House approved the measure in August.
The bill now heads to the White House for President Obama's signature.
"It's been an honor and a privilege to help bring resolution to this important issue," said Cravaack in a statement.
Cravaack will be replaced next month by DFLer Rick Nolan.(0 Comments)
Editor's note: After publishing this story, State Economist Tom Stinson followed up to say that Sen. David Hann's overall job loss number of 115,000 is wrong.
The state budget forecast says that job losses in Minnesota would be 45,000 by the end of 2013 and 70,000 by the end of 2014 if Congress fails to reach a deal to avoid the fiscal cliff. However, Stinson says it's inaccurate to add those numbers together. Rather, the total number of jobs lost in Minnesota as a result of going over the fiscal cliff could be 70,000. That's far less than the 115,000 Hann cited.
Given Hann has his number wrong, and given that Hann answered a question about raising taxes on Minnesota's top 2 percent by pointing to the state budget forecast, which talks broadly about the impact of going over the fiscal cliff not the implications of a possible state tax increase on the wealthy, PoliGraph has downgraded its rating from accurate to misleading.
With the state still facing a $1.1 billion budget deficit, raising taxes was a big topic of discussion during a preview of the coming legislative session.
When asked about whether legislative Republicans would be willing to rethink a tax increase on the state's top 2 percent of earners, long a priority for Gov. Mark Dayton, incoming Senate Minority Leader David Hann, R-Eden Prairie, argued that increasing tax rates could lead to job losses.
To underscore his point, Hann pointed to the most recent state budget forecast.
"The things that we heard in the presentation of the budget forecast, there was some discussion about the impact of increasing tax rates at the federal level and the resulting loss in jobs in Minnesota," he said. "The projection was that over the next couple of years if those federal tax rates go up something on the order of 115,000 jobs would be lost in the state of Minnesota. In other words the state economist was making a very clear connection between raising tax rates at the federal level and loss of jobs."
Dayton responded by saying that there's nothing in the latest forecast that shows raising taxes on the state's wealthiest would mean job losses.
Hann is not too far off, but his statement requires context and clarifications.
Hann's response is a bit confusing because he's talking about the looming fiscal cliff, the simultaneous expiration of the Bush-era tax cuts and massive spending cuts set to kick-in at the beginning of 2013, not Dayton's interest in raising taxes on the state's wealthiest, which was how the initial question was framed.
Right now, Congress is trying to figure out ways to avoid the double fiscal whammy, which many economists fear could send the nation back into a recession.
The ongoing discussions in Washington complicated the latest Minnesota budget forecast. According to the forecast, federal tax increases and spending cuts could lead to 115,000 jobs lost in the state.
So, Hann has his number right. But his statement seems to imply that all these losses are the result of tax increases.
In fact, state economist Tom Stinson said Hann's interpretation of the report is not far off.
"The preponderance of the fiscal cliff is tax increases not spending cuts," Stinson explained.
The fiscal cliff will lead to job losses because both tax increases and spending cuts will reduce the amount of money individuals have to spend, Stinson explained.
"When they spend less, that means that there's less demand for goods and services provided. So hours are cut back, some people lose their jobs, and that spirals into less income again," he said. "It just starts a downward spiral."
Still, Stinson said that it's important to make two things clear:
First, the bulk of the federal tax increases will fall on middle-income earners, who will probably spend less as a result, a factor that would have a bigger impact on the economy than tax increases on higher-income earners, who would probably save less cash in the face of tax increases.
And though Hann chose his words carefully, Stinson underscores that the 115,000 job loss estimate assumes that "we go completely, Wile Coyote-style over the cliff and fall all the way to the bottom."
"It's not just would happen if the top-income individuals had to pay more in taxes," Stinson said. "I think that's the important point to be sure people get."
Though State Economist Tom Stinson makes clear that the employment estimate in the latest budget forecast would be the result of simultaneous tax increases and spending cuts, he says Hann is essentially correct: potential federal tax increases would have a more profound effect on Minnesota job losses. The forecast is silent on the impact of tax increases only on the wealthiest Americans.
Minnesota State Legislature, Legislative panel, Dec. 10, 2012
Minnesota Management and Budget, November 2012 Forecast
Interview, Tom Stinson, State Economist, Dec. 11, 20121 Comments)
WASHINGTON - Tim Walz, a veteran of several tough campaigns, will now get the chance to share some of his experiences with other U.S. House Democrats who represent swing and conservative districts.
On Thursday, the Democratic Congressional Campaign Committee said Walz would lead the group's Frontline Program for members in highly competitive seats. Walz is an alum of the program and his district has voted for George W. Bush and President Obama in the past decade.
Frontline members get help with fundraising and some logistical support from the party. They also aren't expected to contribute campaign funds to the national party organization.
"Congressman Walz is battle-tested and will be a tremendous leader in our incumbent protection program because he knows firsthand how to win in a tough district," said DCCC chairman U.S. Rep. Steve Israel in a blog post.
Walz, who was first elected in 2006 by defeating an incumbent Republican, had a relatively easy re-election effort this time around, but in 2010 he had a hard-fought campaign.
A Minnesota Senate panel is pledging to continue its court battle against former Republican staffer Michael Brodkorb, even though the legal costs have reached nearly $200,000.
Members of the Senate rules committee met today to approve payment of the latest $90,000 bill from the outside attorney they hired in the wake of Brodkorb's firing a year ago. It was later revealed that Brodkorb had an affair with then-Senate Majority Leader Amy Koch.
Senate leaders insist that Brodkorb's employment discrimination lawsuit is without merit, because he was an at-will employee. Brodkorb's attorneys have said he was treated differently than staffers who had affairs and were not fired.
Senate Majority Leader Dave Senjem, R-Rochester, said he firmly believes the case is without merit, and he wants the Senate to continue an aggressive defense in court rather than make a settlement.
"A decision like this is precedent setting, and if we don't stand on our heels and put some cement around them on this, we're going set a precedent that's going to be with this Senate for decades to come," Senjem said. "I think if we believe we're right, we ought to stand on what we believe is right, and in my view that's why we have courts."
DFL Senate leaders, who take charge in January, also support the continued defense. Although Sen. James Metzen, DFL-South St. Paul, raised concerns during the meeting about the mounting costs.
"About two months ago I believed that this thing could cost the Minnesota taxpayers about a half million dollars," Metzen said. "We're at $200,000 already, and as far as I know there's been no depositions, no trial. The meter really runs when you get into that area."
Still, Metzen said he does not want the Senate to settle with Brodkorb. He said he was encouraged by news that Brodkorb has already dropped several of his original claims.