State government spending per Minnesotan is up 20% in real terms since 2010, but they need more money for the roads. Where has it all gone?
If, like me, you’ve ever suggested that the government could spend a little less money and be a bit smaller, at some point you will probably have been answered with a variation of “But who will pay for the roads?”
I argued recently that one of the core functions of government is the maintenance of law and order. For many, you can add the construction and maintenance of infrastructure, such as roads and bridges, to that list of core functions. And yet, as I wrote last year, Minnesota’s state government is failing here, noting that ‘the American Society of Civil Engineers recently said that “Minnesota’s 140,000 miles of roads are in poor condition, earning a grade of a “D+.”’
Last session, Gov. Walz wanted to hike the gas tax by a whopping 20 cents per gallon, a proposal which, thankfully, went nowhere. But now he is back rattling the begging bowl. The Star Tribune reports:
Eight months after Republican lawmakers spurned his proposed gas tax, Gov. Tim Walz is challenging legislators to come up with new ways to pay for aging roads and bridges around the state.
The DFL governor opted not to draw extensively on borrowing to pay for state highways and other large-scale transportation projects as part of a $2 billion public infrastructure bonding package he presented last week.
“That is going to require a comprehensive transportation bill,” Walz said. “And if you’re going to come to the Capitol as a legislator, have the courage to do your job. Don’t kick the can down the broken road.”
The state government is flush with your cash, why does it need more?
You’d assume from this that Minnesota’s state government is short of cash. But the data suggests that such an assumption would be wrong.
Figure 1 shows the total of state government all funds expenditures for 2010 to 2019, adjusted for inflation, in 2019 dollars. It has risen from $33.3 billion in 2010 to $42.6 billion in 2019 – an increase of 28%.
Figure 1: Minnesota state government all funds spending, 2010-2019, $2019
Source: Bureau of Economic Analysis and Minnesota Management and Budget
Of course, Minnesota’s population has risen somewhat over that period, but only by 6%. As a result, as Figure 2 shows, in real terms, government all funds expenditures rose from $6,270 per Minnesotan in 2010 to $7,548 in 2019 – an increase of 20%.
Figure 2: Minnesota state government all funds spending per capita, 2010-2019, $2019
Source: Bureau of Economic Analysis and Minnesota Management and Budget
In terms of your money, Minnesota’s government has never had it so good
The 2019 figures for total state spending – $42.6 billion – and per capita state spending – $7,548 – are the highest in Minnesota’s history. Before state government takes more of Minnesotans hard earned money to pay for a core function like infrastructure, shouldn’t we find out where the record amounts of cash they already spend are going?
John Phelan is an economist at the Center of the American Experiment.