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With Minnesota’s 2013 legislative session in the books, it’s time to total up the DFL’s damage to Minnesota’s economy. The tax increases will hurt Minnesota’s economy the most are the business-to-business sales taxes on warehousing and telecommunications. The warehouse tax has been tried in several states, including Massachusetts. It’s been quickly repealed because it does lots of damage in a short period of time. I suspect that the DFL will repeal the warehousing tax early next session. If they don’t, the damage that tax will do will be considerable, both in terms of economic damage and in political terms.

Another tax increase that will hurt Minnesotans is the cigarette tax increase. In Chicago, where the cigarette tax is high, 75% of cigarette packs don’t have a tax stamp on them. That’s how many cigarette smokers buy their cigarettes on the black market in Chicago. Follow this link for more on cigarette tax avoidance.

Another way that the DFL hurt the middle class they claim to fight for is through the energy bill, which I wrote about here. Here’s what Rep. Mike Beard, the premier authority on energy issues in the Minnesota legislature, said about the DFL’s energy bill:

House Democrats passed their hugely controversial Energy Policy omnibus bill this week that increases even more aggressive, unfunded renewable and solar mandates on utility companies.

Besides huge technological difficulties implementing the new law, it will increase electric costs for all ratepayers (homeowners, businesses, hospitals, you name it) and decrease the reliability of our state’s energy sources.

This bill benefits, to the best of my knowledge, a few Minnesota solar companies that rely on a mandated pool of government money to survive, even though they have over three decades of federal mandates throwing hundreds of billions of dollars at their industry.

The DFL’s energy bill, passed in the name of global warming, will drive up electricity prices:

REP. BEARD: I still have a picture of a poster in my office that Jimmy Carter’s administration put out in 1978, thirty-five years ago, that by the year 2000, fully 20% of our power would come from solar PB. He dropped $12,000,000,000 on that adventure. And what do we have to show for it? Nothing. One tenth of 1% today, thirty-five years later, is solar PB. And so we’re going to take another run at that windmill, and I’m not talking about the ones on Buffalo Ridge. We’re picking winners and losers and we’re desperately hoping that these are winners this time.

In short, the DFL raised taxes on the middle class by raising the cigarette tax. The middle class will get hurt through higher electric bills thanks to their energy bill. The DFL passed that bill to satisfy another of their special interest allies, namely environmental extremists.

Finally, their multitude of tax increases on small businesses will chase some businesses from Minnesota. Other businesses will keep part of their operations here while expanding their businesses in states more hospitable to businesses.

After proclaiming that the GOP’s budget was filled with gimmicks, especially including the school shift, the DFL’s budget failed to pay off the school shift. In 2012, the GOP legislature passed a bill that would’ve paid off the school shift, which Gov. Dayton promptly vetoed. After refusing to pay off the school shift, Speaker Thissen had the audacity to say that their budget didn’t include shifts or gimmicks.

Thanks to the DFL legislature, Minnesotans will have fewer dollars in their pockets and capital will continue leaving Minnesota at an alarming rate.

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This article is the article everyone’s expected since Election Night. Unfortunately, it isn’t the article we’d been hoping for.

Thissen, Gov. Mark Dayton and Senate Majority Leader Tom Bakk of Cook said they agreed on spending targets and will give conference committees a few other guidelines, such as:

  1. The sales tax would not rise on consumer goods, including clothing, but businesses could pay sales tax on goods sold to other businesses.
  2. Income taxes would go up on people in the top 2 percent of Minnesota earners, couples with $250,000 or more taxable income.
  3. An income tax surcharge would be added for Minnesota’s richest of the rich, with proceeds going to help repay money the state has borrowed from school districts.
  4. Cigarette taxes would rise.
  5. Some business tax breaks would disappear.
  6. All-day kindergarten would be funded.
  7. The state would spend $400 million in property tax relief, such as by increasing aid sent to local governments.

Thanks to this agreement, companies will leave Minnesota. Businesses staying will get with multiple tax increases. Businesses will get charged sales taxes on services. Additionally, they’ll get hit with higher income tax rates. That’s bad enough but that isn’t all. Current deductions will get eliminated, too.

Why would a business stay in Minnesota and absorb all those tax increases in a single year? The simple answer is many won’t.

The supposed property tax relief is a mirage. When liberal mayors get their increased LGA checks, it won’t go towards property tax relief. It’ll go towards increased spending. That isn’t a prediction. It’s noting what’s happened in the past without fail. Anyone that thinks Chris Coleman won’t increase spending on things that aren’t necessities isn’t paying attention. He’s done it in the past. He’s a creature of habit. He’ll do it again.

The three Democrats said middle-income Minnesotans would not pay more taxes other than for cigarettes. But when reporters pushed him on the subject, Dayton said that some of the business taxes could trickle down to consumers in higher prices.

Whether it’s in the form of a direct tax increase or it’s in the form of higher prices charged by businesses who’ve gotten hit with a tax increase, the net effect is that the middle class will get hit with higher prices, leaving people with less money to spend on the things of their choosing.

Most importantly, this budget won’t strengthen Minnesota’s economy. The best outcome we should expect from this budget and these policies is that it won’t hurt the economy too much. Fewer jobs will be created as a result of the tax bill. Company profits will be significantly smaller. People will have less disposable income thanks to the energy bill that’s about to get signed.

Gov. Dayton has sent out emails touting a “better budget for Minnesota.” That’s what we deserve. Unfortunately, the DFL has seen to it to give us this budget, which doesn’t strengthen Minnesota’s economy.

Rep. Pat Garofalo ripped the DFL as out of control during this speech during the DFL tax increase debate:

There were 2 highlights during the speech. Both related to the silica sand tax included in the House DFL tax increase bill.

Here’s what Rep. Garofalo said about that tax:

You’re gonna actually tax an industry out of existence with a tax on silica mining. I actually had a liberal activist say to me they thought that by raising taxes on silica mining, they would somehow impact the fracking in North Dakota. (Laughter in background) Spoiler alert. They’re gonna get the sand from other states. Doesn’t matter. It’s gonna have no impact whatsoever on other states’ ability to do fracking of natural gas and oil but it will kill jobs here. And it’s not business groups saying that. It’s not small businesses saying it.

We’ve heard from the local 49ers. We’ve heard from the local unions. In fact, members, this is how totally delusional this tax increase is: Mark Dayton actually labeled the House DFL silica sand tax “ridiculous.” So when a tax increase is so high that Gov. Dayton labels it ridiculous, you know you’re checked out for lunch.

That’s stunning. A DFL activist thinks that killing jobs in Minnesota will shut down the Bakken. That isn’t stupid. That’s beyond frightening. And that isn’t the most frightening part of this.

The truly frightening part of this is that Gov. Dayton, the man whose every thought is to raise taxes, thinks the silica sand tax is “ridiculous.” When a taxaholic like Gov. Dayton thinks that a tax increase goes too far, red flags should go off immediately.

I wrote here about the differing DFL tax bills, characterizing them as disastrous and counterproductive. Little did I know just how disastrous and counterproductive the DFL tax bills were. This is downright frightening.

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Sen. Ron Johnson, (R-WI), has introduced a project that illustrates how the federal government ruins lives. It’s called the Victims of Government Project. This video explains how the Army Corps of Engineers ruined a man’s life for trying to prevent flooding in his neighborhood:

The documentation of how the federal government, specifically the Army Corps of Engineers, uses the Clean Water Act as a weapon against private property owners is instructive. It should tell every landowner that the government, including the Interior Department, the Army Corps of Engineers, the EPA, the Energy Department and other government agencies, are the enemy because militant environmentalists have infiltrated those agencies and departments.

To them, “the environment” is an article of faith. The left’s obsession with controlling people’s lives through regulatory agencies is frightening. The thought that there’s a group of activists that think they have the right, responsibility and authority to tell private property owners what to do is frightening.

Thanks to the Clean Water Act, militant environmentalists have the legislative authority to wreak havoc on private citizens’ lives. By most people’s opinion, Steve Lathrop tried doing a good thing. According to the government’s own recommendations, he did was the government didn’t do. As a result of his taking the initiative what experts said needed to be done rather than waiting through another series of do-nothing studies, Mr. Lathrop got stripped of his wealth.

Predictably, liberal activists aren’t happy with Sen. Johnson. Scot Ross of One Wisconsin Now wrote Sen. Johnson. Here’s what he said in his letter:

“Spending your time, and our money, producing YouTube videos doesn’t move us one iota closer to solving any of the challenges facing our nation. In fact it seems the real victims of government are your constituents who were counting on you to work for them in the United States Senate.”

Solving problems is what elected officials are supposed to do. The Army Corps of Engineers, the EPA and the Interior Department use the Clean Water Act to control what private citizens do with their property. This is a problem everywhere in the United States. Regulations and procedures are put into place. Then citizens like Mr. Lathrop follow the permitting procedures of one agency, only to be told that he didn’t comply with another agency’s regulations. Then the process starts again.

Putting a video together that highlights how the federal government destroys families’ lives is the right tool to affect positive change. That’s what Sen. Johnson was elected to do. Especially in this instance, that’s the right thing to do. When families do what the federal government recommends, they should be rewarded. They shouldn’t be punished.

People across the political spectrum should be outraged by the government’s reprehensible conduct. The Army Corps of Engineers’ actions can’t be justified. Their reprehensible actions can only be rationalized.

It’s time that Congress put common sense restrictions on the Clean Water Act. It’s been used as a weapon for far too long.

UPDATE: Follow this link for more information on Sen. Johnson’s Victims of Government Project.

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The first thought that leaps to mind when I read this article is that Silicon Energy’s business model isn’t built on anything solid:

Silicon Energy, a Washington-based solar panel company, missed its first two loan payments.

So, the Iron Range Resources and Rehabilitation Board (IRRB) restructured the deal and the new payments do not start until October 2013.

Silicon Energy opened its solar panel manufacturing plant in 2011 just outside Virginia, Minn. on the Iron Range.

The company received a $1.5 million loan from the IRRB and the IRRB also gave the Mountain Iron Economic Development Authority $3.6 million to loan Silicon Energy to help build its new plant.

Silicon Energy also owes an initial payment of $75,000 on the $3.6 million loan in October as well.

The head of the IRRB says the company’s business model had to be redone after the tsunami in Japan hurt the company’s timeline for opening up and selling its solar panels.

IRRB Commissioner, Tony Sertich, also says the company did not get into a rebate program offered by Xcel Energy, but should be able to get into that program soon, which should help Silicon Energy sell more solar panels to homeowners and businesses.

First, the Iron Range Resources and Rehabilitation Board is the IRRRB, not the IRRB. Second, the plethora of excuses for Silicon Energy’s failure to make its payments are rationalizations. They aren’t legitimate excuses. Blaming Silicon Energy’s failuter to make their payments on the Japanese tsunami sounds wimpy (Think President Obama blaming the economy’s poor performance on ATMs). Third, a company that needs subsidies, aka rebates, to make a profit isn’t a legitimate business model.

Most importantly, the reality is that the IRRRB’s existence is tied to their dispensing massive amounts of pork to hide the DFL’s unwillingness to let the Iron Range develop a real economy based on mining rather than scraps of pork from the IRRRB.

That isn’t the way to build a real economy. The way to build a healthy, prospering economy is by letting companies create things of value. Do thoughtful people think that a company that fails without massive government subsidies adds anything of value to the Iron Range economy? If it isn’t adding anything to the Iron Range economy, it isn’t adding anything to Minnesota’s economy.

The DFL keeps insisting that solar and wind power are the future. Where’s their proof of that? The only thing on the record thus far are their allegations that wind and solar are the future. That’s anything but proof that they’re the future.

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Intelligent people who’ve viewed this video of President Obama don’t trust what the spinmeister-in-chief is saying:

That President Obama would characterize the budget cuts currently heading in our direction as draconian is insulting. They aren’t draconian. Honest, intelligent people would characterize them as barely visible. If the sequestration isn’t averted for this year, they’ll represent $85,000,000,000 in a budget of $3,600,000,000,000.

Sequestration represents 2.4% of this year’s budget.

This video exposes President Obama, with Charles Krauthammer landing the harshest criticism of President Obama:

Here’s what Charles said:

In terms of the gross domestic product of our economy this is .03, it’s a third of 1% of our domestic economy. On the domestic side, overall, it’s 2.5 cents on the dollar. And overall, on the non-defense side, it’s a penny-and-a-half on the dollar of reductions. Here we are with a debt of $16 trillion and the argument today is if we cut a penny-and-a-half on non-defense spending in one year it’s the end of the world. If so, we are hopelessly in debt and we’re going to end up like Greece.

It’s important that we put this into perspective. The stiumulus passed in 2009 spent $850,000,000,000. There wasn’t a cent of that that wasn’t pork. At least 80% of the stimulus spending was added to the FY2009 deficit.

Here’s another important thing to keep in perspective. In 2011, President Obama opposed the Republicans’ plan to cut spending. Their plan was built on the principles laid out by the Simpson-Bowles Commission. This winter, President Obama is proposing a faux deficit reduction plan that’s equal parts spending cuts and tax increases.

Putting it politely, that’s insulting. President Obama’s already presided over 2 tax increases this winter, one from fiscal cliff deal, the other from the ACA. Does President Obama think that a trio of tax increases in 3 months will strengthen the economy? If he does, then it’s a perfect illustration why he’s the worst economic president in US history not named FDR or Hoover.

President Obama doesn’t want to cut spending. I’m not even certain he cares about the national debt or the annual deficit.

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After reading this Facebook post, I’m wondering if the Interior Department should be renamed the Department of Killing Jobs. Here’s why I’m wondering that:

In a study released last week, Dr. Joseph Mason of LSU demonstrated the vast economic benefits of opening up federal lands to oil and gas development: 500,000 new jobs a year and more than $30 billion a year in federal, state, and local tax revenue over the next seven years alone. That’s just for starters. The study also shows that opening new federal lands to oil and gas production will create a cumulative $14.4 trillion in economic activity. But instead of seizing the opportunity to unlock the benefits of expanding oil and natural gas exploration, the Interior Department on Feb. 6 identified 23 renewable energy projects for priority permitting.

Environmentalists have been making dire predictions about how fossil fuels destroy the environment for almost half a century. At minimum, the vast majority of those predictionsm have been off by orders of magnitude.

For instance, the president of the Sierra Club wrote an op-ed in Outdoor Life magazine in the mid-1970′s about the trouble the Alaskan Pipeline would cause the Barrows caribou. He predicted that it would disrupt the migration route of the Barrows caribou for a maximum of 3-5 years of oil from Prudhoe Bay. The Alaskan Pipeline opened in 1978. It’s still pumping oil from Prudhoe Bay. That’s almost 35 years later.

That’s just part of the consideration for these permits. The biggest reason why fossil fuel permits should be let at a more robust pace is because they make sense economically and environmentally. Permits for renewable energy projects don’t make sense because renewable energy is expensive. People need high-priced energy like they need a heart attack.

It’s a shame that the Obama administration is set in its ways. They’re bypassing the opportunity to stabilize our energy supplies, which stabilizes energy prices. That’s precisely what’s needed right now.

This information should outrage people:

As the table below indicates, BLM’s priority projects would be capable of producing about 44 trillion Btu of energy annually. To put that in perspective, oil wells in North Dakota produced more than 127 trillion Btu in Nov. 2012 alone. That’s almost three times more energy in one month than BLM expects all of its priority wind, solar, and geothermal projects to produce in an entire year. Not only that, but in the last 14 months for which there is data, North Dakota’s energy production, increased by 46 trillion Btus a month. In other words, the increase in North Dakota’s monthly production over the last fourteen months was greater than what the Department of Interior’s pet projects will produce over the course on an entire year. Plus, unlike solar or wind, oil can be used when and where it is needed.

Think about that. The Bakken created 3 times as many Btu’s in a month as these solar and wind projects will create in a year.

Over the course of a year, the North Dakota oil fields would produce 1,524,000,000,000,000 Btu’s. The BLM’s priority projects would create 44,000,000,000,000 Btu’s. That’s a difference of more than 3400%. There’s no justification for the Interior Department’s decision making. There’s only rationalizing their decisions, quickly followed by tons of alarmist-sounding spin.

Considering the fact that the Interior Department is preventing this much economic opportunity, there’s no reason not to rename them the Department of Killing Jobs.

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Gov. Dayton’s State of the State speech was filled with lots of lowlights. Fortunately, there were a few things that might get classified as positives.

First, I’d like to thank Gov. Dayton for highlighting the fact that the GOP legislature put the state on the right track:

According to our Department of Employment and Economic Development, there are over 72,000 more jobs available in Minnesota today than when I took office two years ago. Almost 52,000 of those jobs were added in the past year.

Almost all of the economic policies put in place in Gov. Dayton’s first two years were GOP policies. The GOP legislature pushed for and passed budget reform and permitting reform while doing their best to limit the DFL’s reckless spending. Those reforms gave entrepreneurs some assurances to put their capital at risk and create jobs. It isn’t likely that the DFL-owned legislature and governor will match that record in the next 2 years.

In the decade after Minnesota’s income tax reductions, our economy fared worse than the nation and most other states. And at both the federal and state levels, big tax cuts followed by serious recessions produced large budget deficits, which threaten our current fiscal strength and future economic prosperity.

Minnesota’s economy suffered during the last decade because the DFL legislature wouldn’t reform Minnesota’s permitting system, which often created a bottleneck that choked off continued job creation and economic growth. Permitting reform was the first legislation in the GOP House in 2011. That bill passed quickly, which eliminated many of the bottlenecks that choked off job growth.

The other thing that hindered job growth in Minnesota were Twin Cities elitist progressives like Alida Messinger, Margaret Anderson-Kelliher, Dee Long, Arne Carlson and other environmental extremists. These elitists waged war against high-paying mining jobs. Paul Aasen, Gov. Dayton’s first nominee to be the commissioner of the Minnesota Pollution Control Agency, aka the MPCA, proudly bragged that he’d killed the Big Stone II power plant project that would’ve created 100 high-paying permanent jobs in western Minnesota.

That war against prosperity continues. While the need for sand increases in North Dakota for harvesting Bakken oil, the DFL is pushing for a moratorium on shipping sand from Minnesota. The Bakken will get its sand regardless of the DFL’s hissy fit. The only thing that the DFL’s hissy fit will prove is that Minnesota’s environmental extremists don’t care about high-paying Minnesota jobs. The DFL’s actions prove that they’d rather raise tax rates than create high-paying jobs that result in greater revenue in Minnesota’s general fund.

This part of Gov. Dayton’s speech should frighten thoughtful people:

In Minnesota, we have made real progress in areas like energy conservation, more efficient farming and manufacturing practices, and the development and use of clean, renewable energy, especially wind energy, instead of polluting fossil fuels.

The question is: are we progressing fast enough? Are we doing all we can to utilize other renewables, such as solar, and also to make Minnesota the best place to locate these new industries and their jobs?

Many of you, who served in previous legislatures, deserve great credit for your pioneering work to expand our use of clean energy, including Lieutenant Governor Yvonne Prettner Solon and former Senator Ellen Anderson, who is also here tonight.

I challenge this legislature to work again with our state’s visionary clean energy advocates, large energy providers, large energy users, other stakeholders, and my administration to use your past achievements as springboards for Minnesota’s next big leap toward a sustainable energy future.

The Next Generation Energy Act isn’t an achievement. It’s hurt families’ budgets by driving up electric prices. What’s worse is the fact that the prices are artificially lowered by state subsidies that help hide the true cost of producing electricity through renewables. If wind and solar weren’t heavily subsidized and mandated by government, wind and solar companies would be going out of business left and right. (See Solyndra to remove all doubts about that.)

The worst part is that the fix is in on these policies. Alida Messinger and her environmental extremist allies are pressuring Gov. Dayton and the DFL legislature to pass counterproductive green energy policies that will hurt families when they’re still struggling.

After the next 2 years, Minnesotans will have a clear vision of 2 dramatically different ideologies. Gov. Dayton admitted tonight that the conservative blueprint works. The jury is still out on whether the DFL blueprint will work. Based on past experiences, it isn’t likely to succeed.

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It’s indisputable that the Twin Cities DFL has repeatedly voted repeatedly to kill precious metals mining projects in Ely and Hoyt Lakes. It’s indisputable that Iron Range DFL legislators didn’t criticize the State Executive Council when they shafted miners this week. They’ve tried spinning their votes in a variety of ways but the truth is inescapable: the metro DFL hates mining and will go to extraordinary lengths to stop future mining projects from becoming reality.

It isn’t surprising that Gov. Dayton voted to shaft the miners. As Prof. Kent Kaiser highlighted in an op-ed over a year ago, Gov. Dayton has a history of shafting miners:

Indeed, Dayton’s actions this month were more consistent with his actions two decades ago. At that time, when he was on the State Executive Council as state auditor, he called for the postponement of mining lease votes so he could consult first with the Sierra Club.

While Gov. Dayton’s actions throughout history have been disgusting, they pale in comparison to what he’s done, with the help of the DFL’s militant environmentalist allies, to miners and the Iron Range.

After the 2010 U.S. Census, it was noted that the median household income for St. Louis County, which is the heart of the Iron Range, was $44,941, compared with the statewide average of $57,243. That’s a $12,302 disparity between St. Louis County and the statewide average. It gets worse when compared against Sherburne County’s median household income, which is $71,704, a disparity of $26,763.

It isn’t just the income disparity that paints the truth about the DFL. It’s the fact that the Twin Metals project in Ely and the PolyMet project in Hoyt Lakes would create 1,000 high-paying mining jobs that would end that income disparity while dramatically lifting Iron Range’s economy from mediocre to exceptional.

Notice that I said those project would create 1,000 mining jobs. That’s before factoring in the support jobs those operations would require. That’s before factoring in the possibility of manufacturing operations moving into cities like Hibbing, Grand Rapids and Eveleth to take advantage of the minerals.

That’s before talking about how other mining projects would boost school funding through mining leases in the school land swap areas that the DFL and their militant environmentalist allies are preventing. Some estimates say that these projects could add $2,000,000,000 to the school trust fund over the life of those mining operations.

The clear message from Conservation Minnesota and Friends of the Boundary Waters Canoe Area Wilderness is that precious metal mining is a different, more environmentally unsafe, type of mining. Kennecott has a sterling reputation for limiting and reducing emissions. While this video is of their mining operation in Utah, they were good stewards of their Flambeau River mining operation in Wisconsin. Here’s what their Flambeau River mine:

This link includes an aerial photo of what the Flambeau Mine looks like 16 years after it ceased operations.

Conservation Minnesota, another subsidiary of the Dayton Politics family of political operations, talks the environmentalist talk. Kennecott walks the environmentalist walk.

It’s clear that Kennecott is the real steward of the land.

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When the Minnesota Executive Council decided to postpone the approval of the initial exploration leases, the DFL denied the Iron Range’s miners the opportunity to make a better living for themselves. That wasn’t a smart thing to do. Retiring Rep. Rukavina responded to my email to him. Here’s the email I wrote Rep. Rukavina:

Rep. Rukavina, As a conservative writer, I’ve rarely agreed with your policies but I’ve always admired how you fought for the people of your district. I’d appreciate your opinion on the State Executive Council’s decision to postpone their decision on approving new leases for mineral exploration.

It pains me to see the disparity in incomes between St. Louis County ($44,941) vs. the statewide average ($57,243). There’s no reason why that disparity is that wide. Frankly, it’s disgraceful.

Rep. Ruckavina, I’m in the process of writing an article about the Executive Council’s vote for Examiner.com & I’d love getting your perspective on their decision. Just reply to this email if you’re interested. I promise to publish your statement verbatim in my article.

Good luck in your retirement. Though I disagreed with you, I always appreciated your willingness to fight for your constituents. That’s an honorable thing to do.

Gary Gross

Here’s Rep. Rukavina’s reply:

Gary

I’m perplexed. I sent an email to the three who voted no, I’m awaiting a reply. Frankly, if Gov Dayton is pissed off at the DNR (hell, Rangers have been pissed off at them forever), he should fire some top dogs over there. But don’t take it out on the good people of the Range who have been mining for 130 years and playing by the rules that some folks now want to change.

Perplexed and pissed off would better describe my reaction. But hey, I’m a has been but I have been wondering why I’m the only member of the Range delegation who seems
concerned about this. Perhaps it’s because I’m the only member of the Range delegation who represents the real Iron Range and has never represented any other constituents in my 26 year tenure.

Sorry for not answering you sooner. I’m falling behind on emails as I have been
doing home projects that I neglected for two decades!

There’s nothing for Rep. Rukavina to be sorry about. It isn’t his fault that the DFL doesn’t consistently fight for the citizens of the Iron Range.

I didn’t hide the fact that I’m a passionate conservative from Rep. Rukavina. That didn’t matter to him. His first concern was about his constituents. I respect Rep. Rukavina for tring to put his constituents first.

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