At midnight last night, Minnesota's government officially shut down, save for essential services, after the Republican legislature and Democratic Governor Mark Dayton failed to reach an agreement on how to close the state's $6.2-billion budget deficit (Republicans want more spending cuts; Dayton wants to raise taxes in some areas). So how did Minnesota end up with a $6.2 billion budget deficit? Two words: Tim Pawlenty.
As I explained yesterday, the GOP presidential candidate and former governor spent his eight years in St. Paul turning in balanced budgets by using various accounting tricks (deferred payments, declining to take into account inflation when calculating future expenses), and shifting resources (local property taxes skyrocketed in order to offset shrinking state revenues). It looked good on paper, provided you didn't look too hard. But now, with Minnesota's shutdown making headlines, Pawlenty is doing damage control. Last night, he held a brief press conference at the Minneapolis–St. Paul Airport to offer his thoughts on the shutdown. The kicker: He thinks it's a good thing.
Former Governor and Presidential Candidate Tim Pawlenty says he wishes the brief shutdown he presided over in 2005 lasted longer.
He explains that had the shutdown continued the state might have been better off fiscally.
While Pawlenty refused to directly address the tens of thousands of state workers facing unemployment, he did suggest they should adopt longer term Republican goals based on fiscal responsibility.
This misses one key thing, which is that the actual shutdown itself has an economic impact. As Minnesota Public Radio reports, the shutdown could cost about $12 million per week in lost tourism revenue, $10 million in lost productivity, $2.3 million in lost lottery revenue, and a few million dollars more in lost productivity because workers were drawing up contingency plans for the shutdown rather than doing actual work. Beyond that, one direct consequence of laying off tens of thousands of state workers is that those people become unemployed, placing an even greater strain on the economy. Shutdowns are great if you're primarily concerned with slowly shrinking the size of government with no larger concern for the state's economic health—but that's about it.
In early August, Texas Republican governor and possible presidential candidate Rick Perry will host a prayer summit at Reliant Stadium in Houston. The event, dubbed "The Response" and funded by the American Family Association (which was labeled a "hate group" by the Southern Poverty Law Center), is designed to combat the economic, political, and spiritual crises facing the United States by returning the nation to its Biblical roots. The Response's website proclaims, "There is hope for America. It lies in heaven, and we will find it on our knees." And in a video message Perry sent out this week, he noted, "I'm inviting you to join your fellow Americans for a day of prayer and fasting on behalf of our nation." Perhaps Perry should have clarified what sort of "fellow Americans" he meant, for at this event only Christians will be allowed to share the podium with Perry.
Since the event was first announced in early June, organizers have suggested that it would be a great opportunity to convert non-Christians. Now, they've gone even further: According to an email blasted out by The Response, only Christians will be permitted to speak at the non-denominational event. If representatives of other faiths (particularly Muslims) were to be included, the email noted, such inclusion would promote "idolatry." In a message sent out under The Response's official letterhead, Allan Parker, one of Perry's organizers, described the event in less-than-ecumenical terms:
This is an explicitly Christian event because we are going to be praying to the one true God through His son, Jesus Christ. It would be idolatry of the worst sort for Christians to gather and invite false gods like Allah and Buddha and their false prophets to be with us at that time. Because we have religious liberty in this country, they are free to have events and pray to Buddha and Allah on their own. But this is time of prayer to the One True God through His son, Jesus Christ, who is The Way, The Truth, and The Life.
With this prayerfest, Perry is associating himself with rather radical folks. The American Family Association's issues director, for instance, has said that gays are "Nazis" and that Muslims should be converted to Christianity. Another organizer, Doug Stringer, has said that 9/11 was God's punishment for the nation's creeping secularism. And then there's Jay Swallow, whose endorsement is trumpeted on The Response's website, and who runs "A Christian Military Training Camp for the purpose of dealing with the occult and territorial enemy strong holds in America" (his description). Consequently, it's not much of a mystery why only one of the nation's other 49 governors has so far accepted Perry's invitation to attend the event (Perry invited all of them)—arch-conservative Sam Brownback of Kansas.
Good news, gold bugs. In an effort to promote hard money as an alternative to paper dollars, three tea party senators—Jim DeMint (R-SC), Mike Lee (R-Utah), and Rand Paul (R-Ky.)—introduced legislation this week to exempt gold and silver coins from taxation. Via Peter Kasperowicz:
"In order to rebuild strength and confidence in our economy, we need both the fiscal discipline to cut wasteful spending and the monetary discipline to restrain further destructive monetizing of our debt," [Lee] said. "This legislation would encourage wider adoption of sound money measures, and that's a step in the right direction."
In the same statement, Lee said the dollar has lost 98 percent of its value since 1913. Sen. Paul said it would show that "states are serious about an alternative to a weakening dollar."
The bill is designed to make it easier for state governments to transition to the use of so-called "sound-money" currency. As I reported back in March, more than a dozen states have introduced proposals to, in various ways, promote the use of alternative currencies in official transactions. The argument for this is a constitutional one—supporters say they're simply trying to bring their states in line with Article 1 Section 10 of the Constitution, which stipulates that gold and silver coins be legal tender.
There are also economic concerns. As tends to be the case with collectors of precious metals, supporters believe that the nation's finances are in even worse shape than we've been led to believe, and that the only way out of a Zimbabwe-style (or Weimar-style—take your pick) inflationary collapse is a return to the hard stuff. "It's kind of like if you think back to the Katrina catastrophe, and you read about all the proposals that were made to strengthen and secure the levies that were just never done," as one gold booster told me at the time. Utah—which, in the grips of a tea party fervor, replaced long-time conservative stalwart Robert Bennett with Lee last summer—became the first state to actually pass a pro-gold bill back in March. That law asserts the right of the state to use gold and silver as legal tender and sets up a committee to study the implementation.
But states that are looking to go back to gold face a few obstacles—namely, that there's no infrastructure to actually handle an infusion of gold currency. Carrying around a pouch of gold coins would be a burden (and vaguely Medieval), and so boosters tend to agree that for it really to take off, you'd need a centralized storage facility and then a debit-card-like transaction system, neither of which currently exist. And then there's the cost: gold and silver coins from the US Mint are the only coins that could be used as legal tender, and there's a significant markup on those in addition to the taxes. The Lee-Demint-Paul bill is attempting to tackle just one piece of the problem by making it less cost-prohibitive.
So, does the bill stand any chance of passing? It's a long shot. But it doesn't hurt that Senate Majority Leader Harry Reid (D-NV) is himself an unabashed cheerleader for the gold lobby.
On Friday, barring a last-minute deal between Democratic Gov. Mark Dayton and GOP lawmakers, the Minnesota state government will officially go into shutdown mode. Portions of interstate highways will close. So will state parks, rest areas, DMVs, and the Minnesota Zoo (the animals will still be fed, per a judge's order).
The immediate source of the impasse centers on how to close the state's $6.2 billion budget deficit—the fourth largest in the nation, as a percentage of the overall budget. In many ways, it's a microcosm of the larger debate that's playing out in Washington, DC, with a wrinkle: The man who helped put the state into this mess is now running for president.
Over at the Plum Line, Jonathan Bernstein takes the media to task for spending so much time focusing on Michele Bachmann's embarrassing slip-up on Monday, in which she confused American icon and Iowa native John Wayne with serial-killing clown and Iowa native John Wayne Gacy. He's also irked that ABC's George Stephanopolous wasted precious time grilling Bachmann about her assertion that the Founding Fathers worked to end slavery:
So what counts as a "gaffe" in the eyes of the press corps?
We're getting an excellent lesson in it this week, with the formal rollout of the Michele Bachmann presidential candidacy. Bachmann is taking heat for what seems to me to be a relatively minor mistake in Americana and for a misstatement of early American history.
You know what's not getting nearly the same treatment? Bachmann has been going around for some time now, including on her Sunday TV appearances, spouting absolute nonsense about the debt ceiling. She's claiming that somehow it would be no big deal if the limit wasn't raised.
That's a fair point (and, ahem, here's our coverage of the debt ceiling fight). But I'd expand that much, much further to cover a whole range of other issues that inevitably get buried once the campaign kicks into gear. The relevant point, after all, really isn't that Bachmann says crazy things; it's that she believes those things, and that those ideas are a fundamental part of her political ideology. For instance, as Bachmann noted in her kickoff speech, she launched her political career by opposing Minnesota's state curriculum standards. What was the nature of her opposition? She and her allies argued that the standards were part of a United Nations plot to acclimate children to a pantheistic, pro-abortion, Soviet-style, one-world state—and George H.W. Bush was in on it! Given the current heated debate over education reform, that seems like a pretty ripe topic to bring up in an interview. Certainly more so than the debate over slavery, which has been dormant for a while.
Bachmann's detractors, particularly in Minnesota, tend to believe that her rise has been aided by the failure of mainstream news organizations to look critically at her political views and associations. Her supporters, meanwhile, suggest that she's a victim of the sloppy tendency to focus on trivial verbal slip-ups rather than substantive issues. Two weeks into her presidential campaign, at least one thing is clear: They're both right.