MN finally has a budget… its sort of balanced too, at least within the bounds of the state constitution, thus holding off on the nuclear option, ie mandated property tax increases. The thing is… $2 billion dollars magically appeared by simply not paying what was agreed to.
Granted, such occurs daily, whether it be an average Joe who defaults on loans, or a big business that puts the squeeze on their creditors and/or vendors. Strategically, if your business has the bank or vendor by a hangman’s noose, it can make sense to do so. Ie, if you squeeze their cashflow to the point that get concerned whether they will remain a going concern, almost always they will re-negotiate for better terms (better for you, not so good for them). This is not rocket science, its just negotiation 101. By the same token, if you dont have your vendors or creditors in a noose… then will put the screws on you to try and collect.
Thus, the state has the schools by the noose… and as a result, many schools are going to have to take out loans to cover their operations, which then proceeds to put the schools in a worse financial bind. On the other hand, Pawlenty wins via no new taxes, and the DFL wins because they didnt have to make massive cuts. The banks win, as they get to write new loans. And of course, the taxpayer looses, as they will have to pay interest on such loans… and yet,few if any see any problems with this.
Some yahoos have told me to run for office… lol, its not going to happen. However if I did, I’d propose legislation to end this BS of accounting gamesmanship. Few legislators like paygo, or tabor, as they hamstring the ability to play games (both parties), limit lobbyist influence, and they often force all the cards on the table. Despite the dangers of such, I think MN is in much greater danger with the status quo of doing the same thing over and over, all the while hoping the budget miraculously fixes itself.