Taxpayer-funded lobbying by local MN governments doubles in pandemic
The pandemic may be over but the quest to continue the seemingly unlimited amounts of federal cash doled out to state and local governments the last two years has only…
Today, Minn Post reports
Earlier this month, Minnesota state agencies and local governments sent their requests for capital spending to Minnesota Management and Budget, the state’s budgeting agency, as required by law.
While the total amount presented to the 2020 session of the Legislature is likely be in the range of $1.5 to $3.2 billion, the total value of the submitted requests came in at $5.3 billion. Of that, $4 billion is from state agencies, including colleges and universities, while $1.3 billion is from local governments.
Not all borrowing is bad. If genuine investment generates a return over time, it can make sense to pay for it over time. If a new bridge will benefit the travelers of 2039, why not ask them to chip in a little towards it?
Still, we have to be careful. Politicians love nothing more than spending your money. With that in mind, here are two things for Minnesotans to keep in mind as policymakers begin haggling over these requests.
1 – Is it really investment?
Politicians all too often refer to any old government spending as ‘investment’. Investment, as noted, generates a return over time. If successful – any many investments aren’t – it increases the investor’s productive capacities and earning potential. Consumption spending, by contrast, just gets you by. By piling both categories together, politicians have generated a fair amount of skepticism about the notion of government ‘investment’.
2 – Does the government need to do it?
Accepting that something needs to be done is not the same as accepting that government needs to do it. As it is with investing your Social Security contributions and educating your kids, so it is with investment. Look through a list of proposed projects and ask yourself ‘Does the government need to do this?’
The state government, for example, has submitted a request for $180 million in Housing Infrastructure Bonds and $60 million in public housing construction bonds, both for affordable housing projects. But the shortage of affordable housing in the Twin Cities isn’t a result of too little government spending but because of excessive fees and regulations, imposed, in many cases, by the same people who now want to spend $180 million combating the results of their own policies.
Gov. Walz is required by law to submit his own plan for capital projects to the Legislature by January 15th. Keep these two questions in mind over the next few months.
John Phelan is an economist at the Center of the American Experiment.