Current and former state legislators wrestle with budget concerns

State lawmakers don't return to the State Capitol for another five months, but it already looks like election year politics and partisan differences could dominate the 2010 session.

DFL and Republican legislative leaders gathered Tuesday to talk about the economy and budget problems ahead. But they weren't talking to each other.

Minnesota's next governor will likely face a record budget deficit when he or she takes office in 2011. Some early estimates range from $4.5 billion to $7 billion of red ink in the next two-year budget cycle.

Former Republican Governor Arne Carlson came up with the idea for a nonpartisan summit of former and current lawmakers as a way for Minnesota to better understand what he describes as a pending "economic tsunami."

"All of the governors here, and I think just about all of the leadership here, have gone through processes where you've had to deal with budget deficits," Carlson said. "But nothing that we dealt with will be as large as the one that is coming. That's the point."

Carlson is proposing the current governor, as well as the majority and minority caucuses of the Minnesota House and Senate, come up with individual plans for solving the pending deficit. He said those plans, which would certainly include spending cuts and possibly some tax increases, could then be presented to the public next year as part of the gubernatorial campaign.

"The public elects leaders and they expect them to lead," Carlson said. "You can't lead by avoiding. Leadership is stepping up to the plate, and everybody has to step up to the plate without exception."

Carlson was joined by two other former governors, Democrat Wendell Anderson and Republican Al Quie. There were also five former House speakers and three former Senate majority leaders involved.

During the three and a half hour discussion, Quie suggested expanding the state sales tax to more goods and services. Anderson proposed an increase in the cigarette tax. He said Minnesota would gain $250 million every two years if it simply matched Wisconsin's tax.

"Now, if you had a quarter of a billion dollars and you put that into pre-kindergarten and K-12 and research, wouldn't that be better than keeping the tax low so people can smoke inexpensively?" Anderson said.

Any proposed tax increases will face predictably stiff resistance from Gov. Tim Pawlenty, who has more than a year left in office. Pawlenty isn't seeking a re-election and he refused to participate in the DFL-hosted summit.

David Jennings, a former Republican House speaker, said Pawlenty's absence was sad and emblematic of a larger problem.

"I'm not laying it on his doorstep alone," Jennings said. "I'm just saying that the fact that he couldn't be here to be part of this discussion today is the sign of a very serious problem. "If we can't figure out how to fix that, then we're kidding ourselves about communicating with the public and building confidence among the public."

About 25 miles from the State Capitol, Pawlenty and Republican House and Senate leaders were holding their own summit. It was a roundtable discussion of business issues in Eden Prairie.

Pawlenty viewed the State Capitol gathering as way for Democrats to build support for tax increases. The Republican governor said he didn't need to admire the budget problem, and he claims DFLers are overstating the size of the projected deficit.

"I thought our time was better spent talking to job providers who are entrepreneurs [and] who are in the private economy who understand what it take to grow and provide jobs in this state, rather than having former politicians talk to current politicians with some bureaucrats in the room," Pawlenty said.

Pawlenty acknowledged that the last time he talked to any DFL House or Senate leaders was during the 2009 Legislative session. But he added that there's an open invitation to them.

GOP legislators plan to continue talking to business owners during a series of meetings this fall.

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