DFL gubernatorial candidates candid about possible tax raises

After more than a decade without a general state tax increase, most of the Democrats running for governor say they would consider raising taxes to help solve Minnesota's financial problems.

Candidates traditionally go to great lengths to avoid the "T" word, but several DFL gubernatorial hopefuls say the looming budget shortfall requires a different approach.

When DFL House Speaker Margaret Anderson Kelliher kicked off her gubernatorial campaign last week near Mankato, state Republican Party officials sent out a news release warning that the Minneapolis Democrat is out to raise taxes.

It wasn't exactly a shocking revelation. All of the DFL candidates for governor have been talking about tax increases. Kelliher just isn't ready to offer many specifics.

"I think it's difficult to say exactly what it is going to be," Kelliher said. "But there is no one in this race who can tell Minnesotans that they'll be able to balance the budget without severely harming the valuable things that Minnesotans care about -- education, health care, the state-local relationship -- if there is not some amount of revenue raised at the state level."

Kelliher might not know the amount of revenue, but she has at least one source in mind. She said Minnesotans who are earning over $500,000 a year need to pay their fair share of income tax. That's the income group former U.S. Sen. Mark Dayton said he would also target.

"The wealthiest 10 percent of Minnesotans pay only about two-thirds of their proportionate share of their incomes in state and local taxes as the next 80 percent," Dayton said. "That is fundamentally wrong."

Minnesota's next governor won't take office until January 2011, but some early predictions suggest the new chief executive will face a state budget deficit of between $4.5 billion and $7 billion -- anywhere from 14 to 22 percent of the budget.

"I think there are a lot of people in this state that make some pretty good money that wouldn't mind at all paying a little more in tax."

State Rep. Tom Rukavina of Virginia said the need to raise new revenue won't be the question. He said the only question is: who will pay?

"People make money even during a recession in the stock market, and I think Minnesota has a reputation of helping their neighbors, of being compassionate," Rukavina said. "I think there are a lot of people in this state that make some pretty good money that wouldn't mind at all paying a little more in tax."

Rukavina wants to reverse income tax cuts enacted in 1999 and other DFL candidates agree. State Rep. Paul Thissen of Minneapolis said tax increases alone won't close the entire deficit, but he said new revenue is essential. Thissen and others say expanding the sales tax to clothing or personal services that are currently untaxed should also be discussed.

"I think that we need to sit down and talk about everything," Thissen said. "I don't want to necessarily point to a particular preference of mine right now. I think we need to put everything on the table."

DFL candidates say they're just trying to be honest about taxes, but history shows that politicians can pay a big price for such honesty. Minnesota's Walter Mondale took a hit in the 1984 presidential race when he went with the open approach.

"Mr. Reagan will raise your taxes, and so will I. He won't tell you. I just did," Mondale said during his acceptance speech at the Democratic National Convention in 1984.

Dan Hofrenning, a political science professor at St. Olaf College in Northfield, said Mondale's remark helped Republicans link Democrats with high taxes and big government and it was a winning formula for decades. Hofrenning said it's unusual to hear Democrats again talking openly about tax increases, but he said the political landscape is changing.

"I think Minnesotans and American citizens, they haven't become thoroughly enamored with big government and significant tax increase, but they're more open to it," Hofrenning said. "If they can be convinced that government can bring a more prosperous and just society, I think there's a willingness to be open to some tax increases."

State Sen. John Marty of Roseville has taken political heat before for his stand on taxes. In 1999, he was the lone vote against legislation to lower income taxes. Marty said much of today's budget trouble began with that bill. He said he was honest with voters then and he's being honest with them now.

"I think most voters would rather have somebody who can talk to them as adults and say here's the choices we have, instead of saying, oh, I'm not going to use the tax word because it could cost me some votes," Marty said.

DFL gubernatorial candidates will detail their views on taxes and other issues during a forum Thursday night in St. Cloud. There are currently 10 Democrats in the race, and more are expected to join.

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