Friday, April 17, 2009
Using a combination of cuts, federal recovery funds and new revenues it brings the state budget into balance for not only the next two years, but also the two years beyond that. This is something our Governor does not plan to do. Instead he pushes much of our present problems into the next two years. Seemingly he is hoping, and that�s all it is, is a hope, that things will get much better, much sooner than most economists believe. If his hope is misplaced Minnesota will be in even worse financial straits.
I don't think the Obama administration is buying that with their forecast of GDP. CBO, who has panned some of the President's numbers, nevertheless expects real GDP to grow 4% in 2011, 4.1 in 2012. Indeed, the disingenuous part of Sen. Clark's statement is that there are no forecasters saying growth will be weak in 2011, when the next biennium budget begins. �(See the WSJ survey last week, or Blue Chip yesterday.)� Why is Sen. Clark so pessimistic about Minnesota? �Why does she not share the optimism of her party's leader?
I will be dissecting other parts of this letter next week.