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These negotiations (which I wrote about here) produced some of the biggest winners and losers in recent history. Let’s start with the biggest losers.

It’s impossible to imagine a bigger loser than Tim Walz. He lost on his tax increases, including the gas tax, the sick tax and the income tax increases. He and the DFL lost on spending, too. Another major loser was DFL Speaker Melissa Hortman. She was present throughout the negotiations but didn’t seem to be an active participant in those negotiations. I’d give her a ‘Potted Plant Award’ for participation.

Another major loser throughout the negotiations was DFL House Majority Leader Ryan Winkler. Friday night on Almanac, his first time on the big stage, DFL Rep. Winkler was used like a whipping post, first by Sen. Roger Chamberlain, then by House Minority leader Kurt Daudt. (More on them later.)

The other major loser in these negotiations was Education Minnesota, the people most famous for owning the DFL:

The biggest winners in this negotiations are Minnesota’s taxpayers. They didn’t get hit with one of the biggest tax increases in Minnesota history. That alone makes them a big winner.

The next biggest winner was Roger Chamberlain. Throughout these negotiations, he fought for the taxpayers, reminding the politicians who they worked for, aka the people. He took Rep. Winkler to the proverbial wood shed multiple times. After Rep. Winkler spurted out that “there are no free lunches”, Sen. Chamberlain reminded Rep. Winkler that the people not represented at the Capitol were “the people who pay the bills”, aka the taxpayers.

It’s hard to see how Kurt Daudt, the former and hopefully future GOP Speaker of the House, could’ve been more effective. He stated emphatically on Almanac that the DFL could raise spending by 7.3% without raising taxes a penny. That statement might’ve done more to finish the talks than anything else.

I’d be remiss if I didn’t praise Senate Majority Leader Gazelka for his job in negotiating this budget. Let’s remember that he won a significant tax cut by getting the 7.05% rate dropped to 6.8%. Rest assured that the DFL didn’t fight to include that policy change in the budget agreement.

Finally, I’d have to apologize if I didn’t include the House DFL legislators. They all voted for the Walz/DFL tax increases, which will hurt them in 2020, then saw Gov. Walz throw them under the proverbial bus in final negotiations. I can’t imagine them being too happy with Gov. Walz and the DFL leadership for that ‘favor’. That makes the DFL, especially the DFL House majority, a major loser in these negotiations.

From where I’m sitting, it’s pretty clear that the DFL got smoked in this year’s budget negotiations. First, the DFL didn’t get its 20-cent-a-gallon gas tax increase. Next, the DFL didn’t get its $12,000,000,000 overall tax increase. Third, the DFL had to settle for a cut in the HCAF, aka Sick Tax, rate. Included in this agreement is a drop from 2% to 1.8% on the Sick Tax rate. Further, the final budget will spend approximately $48,000,000,000 instead of the $51,000,000,000 that Gov. Walz and the DFL wanted.

Finally and perhaps most surprising of all, Gov. Walz and the DFL got talked into dropping the middle class tax rate from 7.05% to 6.8%. I’m betting that the DFL didn’t push that during negotiations. I’m betting that Sen. Gazelka pushed that tax cut.

Minnesota Gov. Tim Walz and legislative leaders announced a state budget agreement at a Capitol news conference Sunday night. “This is a budget that invests in education, health care and community prosperity in a fiscally responsible manner,” Walz said just after 6:30 p.m. Sunday, joined by Republican Senate Majority Leader Paul Gazelka and Democratic House Speaker Melissa Hortman at a Capitol news conference. “Today we proved that divided government can work for the betterment of the people we serve.”

Significantly, the deal does not include an increase in the state’s gas tax. The total budget will be a little over $48 billion. Other provisions of the deal include:

  1. a 2 percent increase each year of the biennium for the E-12 education funding formula
  2. an income tax rate cut in the second bracket
  3. continuation of the medical provider tax at 1.8 percent instead of 2 percent
  4. $500 million in bonding, with a large portion of that going to housing projects

I found this part of MPR’s article interesting:

The Senate on Saturday approved a Republican plan for preventing a state government shutdown if a stalemate persists, throwing down a challenge to House Democrats and Walz to either agree or take the blame for a shutdown when the current budget expires June 30. But Democrats had little to gain by taking a vote on the “lights on” proposal, given that Republicans would then have few incentives to keep negotiating.

The bill would fund government for up to two years at current projected levels assuming autopilot growth in the budget of about $1.9 billion. It just happens to be close to the Senate GOP’s original budget proposal, with none of the tax increases sought by Walz and House Democrats to put more into education, health care, transportation and other programs.

Democratic House Minority Leader Tom Bakk dismissed the gambit as throwing in the towel and accused Republicans of bargaining in bad faith.

Isn’t it interesting that, hours after Sen. Bakk “accused Republicans of bargaining in bad faith”, a budget deal was reached? I’d say that Sen. Bakk’s statement looks rather foolish at this point. Perhaps, Sen. Bakk felt stung by the fact that he wasn’t an integral part of these negotiations. Notice who isn’t part of this picture:

Whichever way you slice it, Gov. Walz and the DFL got smoked in his first negotiations.

Friday night on Almanac and today on @ Issue With Tom Hauser, Ryan Winkler insisted that we needed to raise taxes, stating emphatically that “there’s no such thing as a free lunch.” By now, that chanting point is getting rather tiresome. When we spent $100,000,000 on MNLARS (with another $85,000,000 needed to fix Gov. Dayton’s mess), we knew that there wasn’t anything like a free lunch, at least not when the DFL ran things. Republicans knew that things were exceptionally expensive with the DFL in charge.

Further, when Fox9 News reported on the millions of dollars of fraud that went undetected in CCAP funding, we knew that there isn’t anything called a free lunch in government. When we found out about the fraud committed by DFL activists and DFL legislators through Community Action of Minneapolis, we knew there wasn’t such a thing as a free lunch (unless you were well-connected to the DFL in downtown Minneapolis.)

When we heard about the $7,200,000 renovation of the Goose Creek Rest Stop on I-35 near Harris, Minnesota, we knew that the lunches weren’t just not free but downright expensive. I would’ve balked at a $2,000,000 bill for building a new rest stop. Remodeling an existing rest stop should’ve cost $500,000 or less. Further, it’s been closed for 2+ years.

Minnesotans have seen enough of DFL administrations throwing money away or ignoring corruption, not to mention the fact that there’ve been too many examples of money foolishly spent. Now the DFL, aka the party of big government, wants more money to spend foolishly? I don’t think so. They’ll have to earn our trust. We’ve seen the DFL spend too much money recklessly to be trusted automatically again. First, WCCO-TV aired this report:

Later last week, WCCO aired this follow-up report:

Why should anyone trust the DFL to handle our money efficiently? I only know what I can prove. Right now, I can’t prove that the DFL spends much time on oversight or ensuring product quality. I can prove that the DFL spent $7,200,000 on a facility so it complied with their environmentalist activist friends’ wishes.

Saying that the DFL won’t use dirty tricks to win this year’s budget negotiations is like saying that a Doberman won’t attack a man holding a steak if he’s hungry. Of course, the DFL will resort to their oversized bag of dirty tricks. Actually, this statement is kinda mild compared to some of the BS that Chairman Martin has thrown out in the past:

Democratic-Farmer-Labor (DFL) Party Chairman Ken Martin released the following statement in response to the latest budgetary stunt pulled by Minnesota Senate Republicans:

Senate Republicans just made reaching a budget agreement much harder. When Senate Republicans passed their entire wish list as an “insurance measure” in case negotiations fail, they gave themselves every incentive to sabotage those negotiations. This is a political stunt, not serious governing. “Minnesotans overwhelmingly voted for DFLers last November. It’s time for Republicans to accept that, drop their gimmicks, and work with DFLers for the good of Minnesotans everywhere.”

Minnesotans didn’t vote overwhelmingly to raise taxes by $12,000,000,000 over the next 4 years. Show me the debate or campaign appearance when Gov. Walz or DFL candidate pledged to raise taxes by $12,000,000,000. Show me the debate or campaign stop where Gov. Walz or DFL legislative candidate pledged to raise the gas tax by 70%.

The DFL won’t produce that video because it doesn’t exist. Period. Further, Gov. Walz and the DFL seem intent on raising taxes at a time when President Trump’s economic policies are producing record revenues across the nation, including Minnesota. Check out this chart:

That’s a chart that the DFL doesn’t want anyone to see. That’s because it shows how much money the DFL has to work with for crafting a new budget. Right now, this year’s budget surplus was $1,052,000,000. Since then, Minnesota took in $489,000,000 more dollars in April than was forecast. In fact, the year-to-date revenue total is $571,000,000 ahead of forecast. Who knows how much next November’s forecast will change for the positive? I’m betting it’ll change significantly.

If that’s the case, why is the DFL still insisting on raising people’s taxes by $12,000,000,000? That’s economic foolishness. But that isn’t the end to the DFL’s foolishness. According the Gov. Walz’s Department of Revenue, Minnesota’s Rainy Day Fund is the biggest it’s been in history at $2,523,000,000.

According to Kurt Daudt, “the DFL could raise spending by 7.3% this biennium without raising taxes.” Apparently, the dishonest DFL thinks that raising spending by 7% isn’t an adequate ‘investment’ in the DFL government’s special interests.

For instance, the DFL insists that Republicans’ Transportation budget will:

  1. underfund road repair
  2. underfund infrastructure in Greater Minnesota
  3. no aid for local governments
  4. no drivers licenses for all..

I didn’t realize that supplying drivers licenses for all illegal immigrants was a high priority for Minnesota taxpayers. Further, I didn’t think that a 7.3% increase in road and bridge repair equals underfunding road and bridge repairs. I didn’t know that raising spending overall by 7.3% was hurting so many people.

Frankly, I don’t think the Republicans’ budget will hurt Minnesotans. Rather, I think the DFL is that far out of touch with Minnesota. Further, I think that 2018 was the aberration, not the truth. I suspect that 2020 will show a significant re-shifting back to what we had prior to 2018.

If the DFL legislature, from both the House and Senate, want to run on raising taxes by $12,000,000,000 at a time when there’s a huge surplus and revenues streaming in well ahead of forecast, God bless them for gift-wrapping huge GOP gains in the House and Senate.

Every year, newspapers across Minnesota write articles with headlines decrying the lack of transparency in final budget negotiations. This year, the first article I’ve seen on the subject was published by the Pi-Press.

The Pi-Press’s article offers the headline “Secret budget talks at Capitol leave nearly everyone frustrated and in the dark, again” as though this is newsworthy. It isn’t. It’s as newsworthy as reporting that the sun is expected to set in the west — again. The article opens by saying “It wasn’t supposed to end this way — but they say that every year.”

Then it continues, saying “Gov. Tim Walz, Republican Senate Leader Paul Gazelka and Democratic House Speaker Melissa Hortman have offered no real details of their plans and didn’t have a budget deal Saturday afternoon. If they get one soon, politicians and staff will have to scramble to finish their work and will likely need a marathon special session to approve thousands of pages worth of budget bills.”

Part of negotiating is trying to get the upper hand on the guys you’re fighting with. That guarantees grandstanding in the early stages of the negotiations. Thanks to former Gov. Dayton, the end-of-session isn’t considered the true end-of-session. It’s usually thought of as the point when negotiations get serious. Thanks to Gov. Dayton, we can pretty much predict that the DFL will be utterly obstinate.

The DFL is still insisting on raising Minnesotans’ taxes by a total of $12,000,000,000 over the next 4 years. They’re frantically publishing tweets like this:


Here’s another frantic, dishonest tweet, too:


Then there’s this:


It’s stunning that the DFL insists that they aren’t listening to special interest organizations:


What else would you call a lengthy list of special interest organizations? The truth hurts. Deal with it. It isn’t the GOP’s fault that the DFL is the party of snow flakes.

Last night on Almanac, co-host Eric Eskola opened the show by explaining that Gov. Walz, Speaker Hortman and Sen. Gazelka wouldn’t appear on the show due to last-minute budget negotiations. In their stead, the panel consisted of Ryan Winkler and Tom Bakk attempting to make the case for the DFL and House Minority Leader Kurt Daudt and Senate Taxes Committee Chairman Roger Chamberlain representing Republicans.

At the outset, Winkler tried a little humor, saying “Well, when you have the junior varsity on the field like you do on this couch today, that means that the A-Team is out doing the work that they need to do.” Little did I know that Winkler was this prophetic. When Eskola asked whether Gov. Walz and the DFL overpromised, Winkler said “We know that there will be compromise with the GOP Senate but Gov. Walz and the DFL House also wanted to be clear about where we are headed.” Later, he stated that “We want to make sure and do no harm to people.” (It’s a little late for that, Rep. Winkler.)

Kurt Daudt replied “I think Democrats have overpromised. I think that’s pretty obvious at this point. We have a $1,000,000,000 surplus right now. We’ve got another half a billion dollars sitting there already collected over forecast that’s waiting to be recognized in the November forecast and Democrats are still holding onto this dream of raising taxes by $12,000,000,000 on Minnesotans.” Daudt then finished by saying “I just think that’s way out of touch with where Minnesotans are at.”

Here’s the entire segment:

Roger Chamberlain stated emphatically that if the DFL raised taxes by $12,000,000,000, “it will kill this state.” He didn’t mince words, which was the right thing to do. Winkler tried responding, saying that there’s no such thing as a free lunch. That’s when Kurt Daudt buried Winkler, saying “The DFL could increase spending by 7.3% without raising taxes.”

That’s what the DFL JV team looks like. How’d you like to be a DFL House member representing a swing district after voting for these massive tax increases? They’d better campaign wearing flack jackets after those votes. The DFL can kiss all those seats good-bye. Selling those legislators as moderates after those votes isn’t possible.

Let’s be clear. The DFL will get a significant portion of what they want because they control the governor’s chair. Still, the DFL misread their mandate, which they do virtually reflexively.

Finally, Bakk and Winkler tried peddling the BS that Gov. Walz should get most of what he wants because he campaigned on this and he won with a record amount of votes. It’s true that the DFL won with a record number of votes but it’s an outright lie to say that Gov. Walz campaigned by stating specifically that he’d raise the gas tax by 20 cents-per-gallon and raise taxes overall by $12,000,000,000. That didn’t happen so that argument is BS.

Yesterday, I called Eric Eskola, the veteran co-host of TPT’s Almanac, to find out what was happening (and not happening) at the Capitol. As always, Eric was well-informed and a gentleman. While I won’t divulge what Eric said, it wasn’t surprising that neither of us expect Gov. Walz and the legislature to finish their work on time. The only question left to answer is when the special session will be called and whether there will be a government shutdown.

During the conversation, I said that the biggest sticking point might be HCAF, aka the Health Care Access Fund. Recent reports suggest that the HCAF gets raided fairly often, with the excess money going into the general fund. I said that one way of bridging the divide is to cut the HCAF rate, put it off-limits to raids for the general fund and to keep these health care programs around.

Eric thought that sounded reasonable, saying that it sounded like the 2 of us had worked out a reasonable compromise that might avert a special session. I replied that it’s easy doing this because there aren’t partisans around, plus no lobbyists making special requests.

Your job, if you choose this assignment, is to guess a) when the special session will be and b) whether we’ll have a real government shutdown. Post your guesses in the comments. The LFR reader who comes closest wins … hmm — my praise in a future post. Good luck.

Based on Briana Bierschbach’s article, there’s 4 things hanging up a budget agreement. Here are the 4 items:

1) Provider tax
2) Gas tax
3) Other tax increases
4) Spending

What it really comes down to is the DFL wants to spend Minnesota into oblivion. We’re already running a surplus because we’re taxed too much. That expected surplus is already being revised upward. There’s a ton of money flowing into Minnesota’s coffers. Tim Walz and the DFL want to raise taxes even higher and spend money at an unsustainable rate.

Gazelka, R-Nisswa, said there are several pots of money that already exist in the state to spend more on education and public safety, including the state’s $1 billion budget surplus, as well as the more than $2 billion in state budget reserves, which were recently fed even more when revenue collections came in nearly $500 million higher than expected last month. “We can get to places of compromise that still do not need any tax increases to work,” Gazelka said.

Republicans need to say no to the DFL’s tax increases and spending increases, starting with the HCAF tax increase. (HCAF = the Health Care Access Fund.) HCAF funds some subsidized health insurance programs but it frequently gets raided, too. A loyal reader of LFR contacted me and told me that monies have been shifted out of HCAF and into the general fund, where it can be used for who knows what.

Further, I read a recent commentary that says that 77% of the money in HCAF gets moved into the general fund as a sort of “slush fund” to pay off the DFL’s special interest allies. In other words, they could cut the HCAF tax substantially and still have enough money to fund the programs they currently want to fund. That’s before we talk about the gas tax increase, which is obscene, and the other tax increases. Let’s put it this way:

  1. we’re already running a surplus
  2. revenues are coming in faster than predicted
  3. Minnesota’s Rainy Day Fund has $2,523,000,000 in it, the largest in state history
  4. Despite all this, the DFL wants to increase taxes by another $12,000,000,000 over the next 4 years.

What types of drugs are the DFL using? Perhaps the DFL has gotten ahold of the newly legalized magic mushrooms and are using them. This isn’t insane. It’s galaxies beyond insane.

John Solomon’s article on Christopher Steele’s dossier asks the question of who knew what and when:

Multiple sources confirm to me that the recipient of the State Department email was Special Agent Stephen Laycock, then the FBI’s section chief for Eurasian counterintelligence and now one of the bureau’s top executives as the assistant director for intelligence under Director Christopher Wray. The email to Laycock from Deputy Assistant Secretary of State Kathleen Kavalec arrived eight days before the FBI swore to the Foreign Intelligence Surveillance Court that it had no derogatory information on Steele and used his anti-Trump dossier to secure a secret surveillance warrant to investigate Trump’s possible ties to Moscow.

Officials tell me that Laycock immediately forwarded the information he received about Steele on Oct. 13, 2016, to the FBI team leading the Trump-Russia investigation, headed by then-fellow Special Agent Peter Strzok. Laycock was the normal point of contact for Kavalec on Eurasian counterintelligence matters, and he simply acted as a conduit to get the information to his colleagues supervising the Russia probe, the officials added.

This information on Steele was known well before Jim Comey signed off on the first FISA warrant application against Carter Page.

At the time, Comey “swore to the Foreign Intelligence Surveillance Court that it had no derogatory information on Steele and used his anti-Trump dossier to secure a secret surveillance warrant to investigate Trump’s possible ties to Moscow.” That’s a lie. John Solomon’s reporting, including the email from Kathleen Kavalec to Stephen Laycock, shows that the FBI knew that Steele wasn’t reliable. Comey testified the opposite. He testified that Steele was totally reliable. That testimony is discredited, to put it nicely.

If Solomon’s reporting is accurate, and thus far, it has been, Comey’s in big trouble. Lying on a FISA warrant application is bad enough. Lying on a FISA warrant application to spy on a presidential campaign is a total no-no. What’s most frightening is that, if they can do this to the president of the United States, they can do this to anyone.

Kevin Brock, the former FBI assistant director for intelligence, said the State Department’s email in October 2016 ordinarily should have triggered the FBI to reevaluate Steele as a source. “This is quite important,” Brock said. “Under normal circumstances, when you get information about the conduct of your source that gives rise to questions about their reliability or truthfulness, you usually go back and reevaluate their dependability and credibility.”

This isn’t unravelling the way Adam Schiff, Elijah Cummings or Jerry Nadler hoped it would. They didn’t think that Barr would go on the offensive. They thought wrong. Finding out if the Obama administration cut corners to help Hillary get elected is the right thing to do. Now, Nadler, Cummings and Schiff are put in the position of defending the indefensible. They deserve that fate.

When it comes to legal matters, Trey Gowdy doesn’t mince words. He’s one of the most honest people to have recently served in Congress. If he says that someone is in legal jeopardy, bet on that person to start hiring attorneys. This afternoon, Mr. Gowdy stated that former CIA Director John Brennan was in hotter legal hot water than former FBI Director Jim Comey. It isn’t a secret that Jim Comey is in trouble. That’s what’s behind his constant blabfests on CNN and on speaking tours.

What’s known is that the FBI didn’t attempt to verify the Steele Dossier until after the election, which is well after Jim Comey attested to the FISA Court that it had been verified and that Christopher Steele was a trustworthy informant. Those aren’t accurate statements, which means, I suspect, that he’ll be one of the first people dragged before U.S. Attorney John Durham’s grand jury to get squeezed by Mr. Durham into turning state’s evidence against Brennan and other bad actors from the Obama administration. (Jim Clapper and Loretta Lynch pop to mind. Imagine that.)

“That’s a pretty easy thing to sort out, who insisted that the dossier or the unverified material from Chris Steele be included,” he said. “But … sometimes when you have two people, I can tell from you having been in the courtroom, sometimes when people are blaming each other, they are both right. It’s both of them. And I think it’s interesting Brennan and Comey right now, the only thing they seem to share is a hatred for Donald Trump. It’s going to be interesting if they begin to turn on one another. I’ve seen the document. I’m not going to describe it any more than that, Comey’s got a better argument than Brennan based on what I have seen.”

I wouldn’t want to be either of those gentlemen at this point. Yes, I use the term gentlemen loosely in that sentence. If I wasn’t such a gentleman, I’d probably call Comey, Clapper and Brennan losers. But I digress.

Even Rod Rosenstein is upset with Comey:

Here’s why Mr. Rosenstein is upset: