Legislative Recap: American Experiment leaves an impact in St. Paul
Minnesota’s conservatives did quite well in the 2019 legislative session (read detailed report here). The legislature increased spending by six percent—too much, but less than it went up last year with Republicans controlling both houses. While the two percent tax on health care wasn’t allowed to expire, it was reduced to 1.8 percent. Otherwise, there were no tax increases, and the legislature cut the state’s second tier income tax rate by 0.25 percent.
Meanwhile, many bad ideas were defeated. Socialized medicine (ONEcare) went nowhere. Proposals to increase Minnesota’s corporate income and estate taxes were defeated—American Experiment’s economist, John Phelan, testified against both—as was a move to bail out state and local government pension obligations. And some needed legislation became law, including: conformity with the federal tax code, a rebuild of nonfunctional MNLARS software, and an external audit of the Department of Health and Human Services’ budget.
American Experiment weighed in on many of these issues, and were especially active in two areas: opposing the governor’s proposed 70 percent increase in the gas tax, and opposing legislation to raise Minnesota’s 25 percent wind and solar electricity mandate to 100 percent.
We identified the gas tax hike as a key issue that would be resolved in the session’s closing days. So, we set up a web page, NoNewGasTaxes.com, which laid out the facts on the proposal. We pointed out that the 70 percent increase would give Minnesota the fourth highest gas tax in the country; that we already have $8 billion in road and highway spending appropriated but unallocated; and that the proposal actually was a bait and switch. Along with hiking the gas tax, the plan would have reversed the two-year-old dedication of one-half of sales tax receipts on auto parts to roads and highways. So, the higher gas tax would have been used largely to enhance the general fund, not to pay for highways.
We bought billboards on highways around the Twin Cities, urging motorists to oppose the gas tax increase and directing them to NoNewGasTaxes.com, where visitors could, in just seconds, email to Governor Walz to oppose the tax increase. More than 2,500 Minnesotans used our web page to send such emails. On local radio, we argued against the gas tax increase and also placed anti-gas tax increase ads.
Behind the scenes, we encouraged legislators who opposed the tax increase to stand firm. And that is what happened: the gas tax hike was defeated in the Senate.
When the session began, DFL legislators introduced bills to raise the “green” (wind and solar) power mandate from 25 percent to 50 percent. But before long, liberal legislators and Governor Walz came out in favor of a 100 percent “green” electricity requirement.
The Center’s recent paper, “Doubling Down on Failure,” analyzed the impact of a 50 percent mandate. Our policy analysts found that generating half of our electricity with wind and solar power would cost over $80 billion, raise electricity rates by 40 percent, destroy 21,000 permanent jobs, and devastate industries like mining, manufacturing and agriculture. Getting 100 percent of our electricity from wind and solar can’t be done—those energy sources are too unreliable—and attempting to do so would be exponentially more expensive.
Isaac Orr testified against the heightened mandate six times before House and Senate committees. The upshot was that the 100 percent wind and solar bill went down to defeat, even though it was backed by both environmental groups and utilities that looked to have their profits increased by more “green” mandates.
All told, the 2019 legislative session was a good one for conservatives, and the Center played a major role in promoting good bills and arguing against bad ones.