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Hello from St. Paul,
A recent budget analysis from Minnesota’s fiscal experts has found that our state’s economic condition is heading in the wrong direction. I am not surprised.
Last session, the majority party squandered an $18 billion surplus, raised taxes by $10 billion, and grew government spending by a jaw-dropping 40%. You can’t make that level of spending commitment and expect incoming revenues to keep pace, and they very clearly are not.
The state will see a $456 million budget surplus for the upcoming budget cycle. In December, budget analysts thought we’d see a $616 million surplus. A year ago, they thought we’d have a $1.7 billion surplus.
But the real bad news is the projection for the next budget cycle, which has grown from a $5.1 billion deficit to $6 billion – which approaches the largest deficit total in the state’s history.
Everything is trending downward. Last year we were looking at a nearly $20 billion surplus, and now we’re bracing for a $6 billion budget deficit. Had any fiscal restraint been shown last session our outlook would be much better. Instead, we will soon face our state’s largest budget deficit.
Have a good weekend,
Greg
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