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Guest Editorial:  LeRoy Stumpf, Grand Forks Herald

THIEF RIVER FALLS - Personal income earned by Minnesotans outpaced the nation from the 1960s to the late 1990s. As state economist Tom Stinson put it recently, our rise in prosperity over the past 40 years "is an amazing success story." Minnesota ranked around 24th nationally in personal income in the 1960s, but more recently moved up to seventh in the rankings, he points out.

"The only explanation is that the quality of the Minnesota work force allows people to make more money," he said. Minnesota has managed to overcome its location disadvantage "clear at the end of the road," Stinson noted.

More recently, the economic situation in Minnesota, as well as the entire nation, has slipped significantly. On a bipartisan basis, two well-respected former finance commissioners are warning that the United States and Minnesota both are heading down a fiscally irresponsible path that could put us at a competitive disadvantage globally.

John Gunyou served as Republican Gov. Arne Carlson's finance commissioner; Jay Kiedrowski served under Democratic Gov. Rudy Perpich. Despite their differing affiliations, they agree that current federal and state fiscal policies are irresponsible and will make us poorer in the long run.

Both of these financial experts express concern that the state is failing to invest properly in our human capital - young people who will need the education and training necessary to compete successfully in the workplace.

In a recent forum sponsored by the Minnesota Budget Project, Kiedrowski outlined the perils of the federal government's deficit spending. The U.S. national debt is more than $7 trillion and growing. The debt now equals 4 percent of the gross national product, which is considered the extreme limit for national credit worthiness.

Gunyou describes the state's fiscal situation as "unprecedented" with the state consistently spending more than it has raised for the past three years. Soon, our bag of fiscal tricks will run out. Accounting for basic inflation both in revenues and spending, the state budget deficit in the next biennium is projected to top more than $1 billion.

Gunyou and Kiedrowski agree that Minnesota's state and local total spending as a share of the state economy is shrinking. In fact, over the past decade the price of government has slipped from 17 percent in the early 1990s to 16 percent in 2002 and is projected to slide further to 15 percent by 2007.

The future quality of our work force is at risk. As cuts in school funding continue and higher education tuition costs climb at a double-digit pace every year, fewer state residents will get the quality education and training they need. Minnesota's existing competitive advantage soon could slip away.

The two former finance commissioners agree that investments in human capital pay off in the long run. They point to the work-oriented Minnesota Family Investment Program, Head Start and early childhood education as among the vital state services needed if Minnesota wishes to continue competing successfully in the global economy.

Tough decisions will be necessary to keep Minnesota and the nation's economy strong in the future. On a bipartisan basis, our state's leading financial experts agree that we are failing to act responsibly. Getting started on fixing this fiscal mess has to be a top priority the next time the Legislature meets - in special session if we have one, or next year at the latest.

Minnesota has been recognized for its leadership in education over the last 30 years. That reputation is beginning to slip away. It is time to reinvest in our future.

Stumpf, DFL-Thief River Falls, represents District 1 in the Minnesota Senate.
 
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