This Billionaire Governor Taxed the Rich and Increased the Minimum Wage forums forums Politics and other things This Billionaire Governor Taxed the Rich and Increased the Minimum Wage

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    Now, His State’s Economy Is One of the Best in the Country.

    When he took office in January of 2011, Minnesota governor Mark Dayton inherited a $6.2 billion budget deficit and a 7 percent unemployment rate from his predecessor, Tim Pawlenty, the soon-forgotten Republican candidate for the presidency who called himself Minnesota’s first true fiscally-conservative governor in modern history. Pawlenty prided himself on never raising state taxes — the most he ever did to generate new revenue was increase the tax on cigarettes by 75 cents a pack. Between 2003 and late 2010, when Pawlenty was at the head of Minnesota’s state government, he managed to add only 6,200 more jobs.

    During his first four years in office, Gov. Dayton raised the state income tax from 7.85 to 9.85 percent on individuals earning over $150,000, and on couples earning over $250,000 when filing jointly — a tax increase of $2.1 billion. He’s also agreed to raise Minnesota’s minimum wage to $9.50 an hour by 2018, and passed a state law guaranteeing equal pay for women. Republicans like state representative Mark Uglem warned against Gov. Dayton’s tax increases, saying, “The job creators, the big corporations, the small corporations, they will leave. It’s all dollars and sense to them.” The conservative friend or family member you shared this article with would probably say the same if their governor tried something like this. But like Uglem, they would be proven wrong.

    Between 2011 and 2015, Gov. Dayton added 172,000 new jobs to Minnesota’s economy — that’s 165,800 more jobs in Dayton’s first term than Pawlenty added in both of his terms combined. Even though Minnesota’s top income tax rate is the 4th-highest in the country, it has the 5th-lowest unemployment rate in the country at 3.6 percent. According to 2012-2013 U.S. census figures, Minnesotans had a median income that was $10,000 larger than the U.S. average, and their median income is still $8,000 more than the U.S. average today.

    By late 2013, Minnesota’s private sector job growth exceeded pre-recession levels, and the state’s economy was the 5th fastest-growing in the United States. Forbes even ranked Minnesota the 9th-best state for business (Scott Walker’s “Open For Business” Wisconsin came in at a distant #32 on the same list). Despite the fearmongering over businesses fleeing from Dayton’s tax cuts, 6,230 more Minnesotans filed in the top income tax bracket in 2013, just one year after Dayton’s tax increases went through. As of January 2015, Minnesota has a $1 billion budget surplus, and Gov. Dayton has pledged to reinvest more than one third of that money into public schools. And according to Gallup, Minnesota’s economic confidence is higher than any other state

    Gov. Dayton didn’t accomplish all of these reforms by shrewdly manipulating people — this article describes Dayton’s astonishing lack of charisma and articulateness. He isn’t a class warrior driven by a desire to get back at the 1 percent — Dayton is a billionaire heir to the Target fortune. It wasn’t just a majority in the legislature that forced him to do it — Dayton had to work with a Republican-controlled legislature for his first two years in office. And unlike his Republican neighbor to the east, Gov. Dayton didn’t assert his will over an unwilling populace by creating obstacles between the people and the vote — Dayton actually created an online voter registration system, making it easier than ever for people to register to vote.

    The reason Gov. Dayton was able to radically transform Minnesota’s economy into one of the best in the nation is simple arithmetic. Raising taxes on those who can afford to pay more will turn a deficit into a surplus. Raising the minimum wage will increase the median income. And in a state where education is a budget priority and economic growth is one of the highest in the nation, it only makes sense that more businesses would stay.

    It’s official — trickle-down economics is bunk. Minnesota has proven it once and for all. If you believe otherwise, you are wrong.


    There’s no such thing as “trickle down” economics.


    I often wonder why so many people believe business will just move over what is a modest and reasonable cost of labor.

    For the vast majority of business:

    1. They are location locked. Doing food, or basic service? Then you do it where the work is. End of story.

    2. Cost of move very significantly exceeds cost of labor delta. Often, this cost is so great the business is left unable to innovate for a time, meaning they have an additional opportunity cost equal to the losses relative to their competitors.

    (and that’s all typically big numbers)

    3. They either must get their people to move, which actually is plausible, and does happen, or they must find new people and get them into the company and able to perform like the existing ones do.

    Big turnover is always expensive. Forcing it? Silly.

    BTW: Two businesses now located here in Portland Oregon were originally located in Cali and Arizona. Both picked up and moved here to PDX for a lot of reasons. Almost the entire staff picked up and moved.

    This happens with small to mid-sized businesses, but it’s almost always to a better place both politically and economically for everybody involved.

    A boss who has a hard on for Colorado Springs is a boss that’s going to end up there by themselves and perhaps a couple yes people at best. Very expensive. Political statement, not business move.

    I could go on, but the point is a move just isn’t the easy thing it’s framed to be. Moving can often end a business, and if it’s really easy to move, then it’s just not that much of an established business, or it already operates with people all over the place, meaning the move isn’t really material in most cases.


    Sure they can be squeezed because of the cost of moving.


    F&B, supply side economics, trickle down, etc… are all terms that represent the current Republican approach to economics.

    There aren’t any free markets anywhere either.

    So then, how markets perform, and the economic outcome for the people involved in them has a lot to do with how those markets are managed.

    Democrats are better at this. We’ve got lots of data to support it.

    Republicans are much worse at this. We’ve got just as much data on that.

    Most recently? Kansass did as badly as Minnesota did well. Difference?

    I’ll leave that for you as an exercise.

    Oh, and nice try. The current and growing association with that term, the Stupid Party, and bad economic outcomes isn’t looking all that good for Republicans these days.

    I’m adding that to the dodge list, right along with that thing JR-Tech thought up.

    Let’s call it “bushing”

    Despite a lot of votes, it’s really hard to find Bush voters these days. It’s really hard to find people even willing to talk about him much, and Jeb just kicked off his, “I am my own man” campaign, despite his platform being just about the same shit W did, with some sparkle.

    Bushing is when something gets swept under the rug with the intent to marginalize it’s negative impact, while at the same time clearing the path for new advocacy on the same garbage policy that resulted in a term being swept under the rug!


    YES! As they should.

    We need to pay people enough to make it. It costs too much to subsidize all those profits.

    If business owners want profit, they can earn it the hard way by adding real value, not mooching off the public dime with subsidized labor.

    And people are starting to figure this out. We can bump the labor to a reasonable level, and let it sort out a bit at a time. Each time we get this done, dependence on public subsidies will drop, as will the few moocher businesses who aren’t viable otherwise.

    They will be replaced by better ones, and demand will improve.

    Profits made by adding value are great! Let’s make a lot of profit and add a lot of value. We all are better off.

    Setting up shop while expecting Uncle Sam to cover your labor is bull shit.



    Let’s say we think it’s OK to subsidize business for whatever reason.


    But then we can’t really bitch about people actually using Government programs to get by, now can we?

    It’s one or the other.


    Wait a minute. I thought that raising taxes on the wealthy and raising the minimum wage would destroy economies? Huh??


    If the wealthy are paying zero taxes, then they should be raised. It’s not always bad to raise taxes. It is always bad, however, for the government to artificially set prices. That’s the job of the marketplace and the free choice of individuals.


    The marketplace is the people and the people are the government.

    And it appears what they did in Minnesota seems to be working. Unlike Kansas.

    Andy Brown

    F&B espoused: “It is always bad, however, for the government to artificially set prices. That’s the job of the marketplace and the free choice of individuals.”

    Wrong again, ace. Price ceilings only become a problem when they are set below the market equilibrium price.

    Did you graduate high school?


    Most likely not.

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