Last week, in the post SD18 Issues: How will Scott Newman support
farmers?, Bluestem focused on agribusinesses that were named in a question about business subsidies asked by the local conservative blog MNPatriots. Here's the question, with our area of focus on agriculture put into bold type:
Business Subsidy and “Making” Jobs: The public is calling for the government to ‘make jobs’ at an unprecedented rate. Asking government to borrow more money and spend it on ‘works projects’ expands the already exploding deficit. Decades from now economists will debate whether the Trillions of Dollars spent on bank bail-outs, car company take-overs, and artificially low interest rates were necessary to save the nation’s economy from the natural implications of unwise lending practices initially designed to ‘stimulate’ construction jobs. Ethanol from corn has been scientifically demonstrated to be counter-productive yet we subsidize the plants producing it. Crop producing land receives significant reductions in property tax, which is a substantial portion of the commercial tax base from which rural citizens are expected to pay for urban style education—in essence subsidizing cheap food for urban residents. Rural taxes are collected and spent on urban mass transit to subsidize urban commuters. Construction projects are subsidized by artificially high wage rates. The government hiring additional public safety, education, and maintenance workers does not create a sustainable economy of scale. Quite the contrary, it does less with more.
4) Do you support the elimination of all business subsidy? Including the subsidy for corn, milk, ethanol, farm property tax, mass transit, construction projects, public service wages, etc. This includes stopping the up-coming ‘make jobs’ projects likely to be part of the next round of budget talks.
Newman: Yes. It is not the role of government to artificially assist one group of business and not others. I would rather let the market determine whether a business is viable. Remember Reagan’s sarcasm; “if it moves tax it. If it stops moving subsidize it”.
I added:
The parts of the question I set in bold are of particular interest in a largely rural district like Senate District 18.
One can click on the link to see more on why those parts of the question (which I quoted in its entirety, along with Scott Newman's entire answer). In a nut shell, a lot of property in SD18 is enrolled in
Ford Peterson commented that it was unfair to focus on the "farm welfare" specifics of the question:
. . .In fairness, Mr. Newman was responding to his idealogical [sic] approach to the notion of "subsidy," which according to the question includes mass transit, construction projects, public sector make work jobs, as well as farm business subsidy. Singling out farm welfare is a polarizing and unfair characterization of the question, and his response. . . .
One wonders why asking about specific points raised by the question is polarizing and unfair. If it's okay for Peterson to bring these specific programs up, reasonable people would think they're on the table.
Peterson's comment also made me wonder what Scott Newman's legislative record was on the specific programs the MNPatriots' question enumerated among "business subsidies." Let's review the question and answer:
4) Do you support the elimination of all business subsidy? Including the subsidy for corn, milk, ethanol, farm property tax, mass transit, construction projects, public service wages, etc. This includes stopping the up-coming ‘make jobs’ projects likely to be part of the next round of budget talks.
Newman: Yes. It is not the role of government to artificially assist one group of business and not others. I would rather let the market determine whether a business is viable. Remember Reagan’s sarcasm; “if it moves tax it. If it stops moving subsidize it”.
Dean Mahlstedt, who came closest to Newman in securing delegate support at the recent Republican endorsing convention, and Tim Benoit gave similar "Yes" answers. Both have agreed to abide by the endorsement. Glencoe Mayor Randy Wilson,a moderate Republican who has left his options open as far as running in the Republican primary goes, disagreed:
We need to look at the entire scope and value of a subsidy. Anyone who would rule out all subsidies is not looking at the greater good of some projects.
After voters picked Newman in a special election, he finished out Tony Kielkucki's term (one session) and then was elected outright for a single term, before he retired to seek election as a district judge. Like all who have recently served in
This is where it gets interesting. Let's take a look at legislation Representative Newman introduced ("Chief Author") or signed on to as a sponsor ("Author"), as might be expected for someone suddenly thrust into the middle of the 83rd Legislature by a special election, Newman was only
Chief Author for seven bills, none of which dealt with business subsidies, nor did any of the bills for which he was
Author. One of the bills, a Senate bill in which plat and survey approval requirements clarified for which he was House companion bill chief author, was passed into law, while one of the bills for which he was a co-author (a non-controversial, bipartisan measure dealing with the Minnesota Comprehensive Health Association) passed unanimously in both houses of legislature.
The 84th Legislature, which includes a special session along with the two yearly sessions, is a different story. Newman was Chief Author of 24 bills, none of which was passed into law as a stand alone bill and none of which dealt with business subsidies. He was Author for slightly over 100 bills. Some of these might be considered relevant to the MnPatriot question about business subsidies.
See below the fold
| HF1560 | Text | Summary | Description | Rural economic development base funding level established including ethanol producer payments. |
| HF0991 | Text | Summary | Description | E85 motor vehicle fuel pump installation tax credit provided. |
| SF0969 | Text | Summary | Description | State policy on minimizing energy use and requiring renewable fuels clarified.* |
| HF0719 | Text | Summary | Description | Dairy operation investments income and corporate franchise tax credit provided. |
| HF0632 | Text | Summary | Description | Employer income tax credit for creation and retention of certain rural county jobs authorized, and money appropriated. |
| House | HF0223 | Text | Summary | Description | Ethanol minimum content in gasoline increased. | ||
| House | HF0216 | Text | Summary | Description | Ethanol minimum content required in gasoline, renewable liquid fuel goal established, and promotion activities required. |
Newman also supported the Senate version of HF0223, which was passed into law:
| House | SF0004 | 52 | Text | Summary | Description | Ethanol minimum content in gasoline increased, and petroleum replacement goal established. |
Would a mandate for ethanol content in gasoline be considered a subsidy? it certain dictates the use of one ingredient over another.
Does Newman still support these measures? Would the other two candidate seeking endorsement who stated their opposition to business subsidies have voted for this bills? Or was Newman simply pandering in his answer to the MNPatriots' question?
During the special session, new signed on as 2005 1st Sp.S. - Author for only one bill, HF0028, which dealt with campaign finance reform. Tom Emmer was the chef author of the bill, which did not pass as a separate bill.
Newman's voting record is next.
Image: Fox weathervane. Is Newman an ideologue or political fox?
You ask good questions. Questions that should be asked of every legislator. I wonder how many of them that supported ethanol a few years ago would support an expansion of ethanol from corn today? We are witnessing the evil nature of subsidy at work. And the horrific destruction of capital that ensues from trying to eliminate the taxpayer's entanglement.
There are forces in motion trying to increase the 'mix' to 20% in MN. Most cars won't run very long at 20% as the warrantee book says a maximum of 10%. Only flex fuel vehicles can run on E85. Build a dependency with a subsidy and it becomes a mill stone around the necks of the taxpayers forever. Either a business survives and thrives on its own merits, or it fails. Free economies have functioned this way since men started trading with each other.
It sounds cruel, but an 'investor' relying on a farm welfare payment to survive has not made an investment, they have paid (or are about to pay) a substantial tax equal to their failed 'investment.' These are my opinions, not necessarily Newman's. You will have to ask him whether he is willing to advocate on behalf of ethanol from corn investors. My hope is that he would not advocate for any new dependencies. The question facing ethanol from corn investors is how to conserve capital in a failed business model. The question facing our elected representatives is "Now that we have helped to build the beast, do we intend to keep feeding it tax dollars?"
Posted by: Ford Peterson | Mar 23, 2010 at 10:59 AM