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IT’S BBBBAAAAACCCK!  AMTRAK  TO DULUTH JUST WON’T DIE

04.21.2022
It's BBBAAAAACCCK! AMTRAK to Duluth Just Won't Die

No bad idea ever really dies at the Minnesota Capitol.  No, like all good horror movies, just when you think the villain is dead, they somehow are able to come back to life only to terrorize unsuspecting viewers all over again.  And so it is with really bad ideas at the legislature – ideas that require a whopping amount of subsidies and ideas that have died decades before – they just keep coming back.

The newest and scariest idea being voted on in the House is to resurrect the four trips per day Amtrak train from Minneapolis to Duluth (with three stops along the way) – you know, just like the route that was cancelled in 1986 due to lack of ridership.

This time, rail enthusiasts are arguing that the Feds are offering “free money” for shovel-ready rail projects like this proposed Northern Lights Express route and if Minnesota doesn’t jump on the build rail bandwagon, another state will. 

Good.

Because while our president enjoys the many “benefits” of this 19th Century technology, our state taxpayers figured out years ago that there are easier, quicker and less expensive ways to get to Duluth – it’s called 35W.  And the added bonuses of driving to Duluth are many -- including having a car to use once you arrive in the Duluth or the Twin Cities -- but also the added benefit of stopping along the way at Tobies.  With your car, you have the freedom to stop whenever you want – not where government planners make you stop.

What these rail devotees don’t want you to know is that while the federal government will provide up-front funding for some of the costs of modernizing the rail tracks for this 155-mile route, Minnesota taxpayers – like you and me, many of whom will never set foot on this rail line -- will be asked to subsidize the operation of this train service in perpetuity – starting next year with an $85 million dollar taxpayer down payment.  The general operating costs to keep the line operational with eight trips per day are extra and will only increase if/when the ridership doesn’t meet expectations – which it will not.

These last two years have been devastating for many Minnesota businesses but especially so for the tourism industry that pre-pandemic, employed over a quarter of a million Minnesotans and generated nearly $1 billion in annual sales tax for the state.  Conversely, train ridership, commuter rail and even dependable regular route bus service, collapsed.  While bus ridership is slowly rebounding in the Twin Cities, rail ridership on the Northstar Commuter Rail line remains virtually non-existent and should be discontinued, regardless of the financial consequences of paying back the federal government for this failed experiment.  In light of the pandemic collapse of rail, the last thing the legislature should do is resurrect a previously failed rail line to Duluth with the delusional expectation that it will somehow generate more riders today than it did in its heyday. 

There’s a reason why filmmakers made millions producing 12 versions of “Friday the 13th" movies – some people never learn that the ending of every horror movie is virtually the same – very scary. In Minnesota we call them legislators.

 
SHORT TAKES

ROBBING PETER TO PAY ST. PAUL’S AWFUL RENT CONTROL ORDINANCE
Weeks before the St. Paul rent “stabilization” plan takes effect, the St. Paul Pioneer Press reports that “Apartment Construction Slows by More than 80 Percent in St. Paul.”  But wait, there’s much more to this story.

While city officials try to explain away why developers might be scaling back plans to build much needed housing in St. Paul, a much more damning report was released about the longer-term effects of this hastily-conceived ordinance.
Specifically, “researchers with the University of Southern California’s Marshall School of Business published a 58-page study of St. Paul’s housing market that claims that rent control caused property values to fall by 6 or 7 percent, for an aggregate loss of $1.6 billion.” 

The study’s authors note that St. Paul’s rent control ordinance is especially “stringent” and does not adjust rents for inflation or exempt smaller rental units or even new construction.  The report goes on to say that this utopian dream of income redistribution is doing little or nothing to help the poorest city residents.  Huh.  Didn’t see that coming did we?

You can read the full report HERE and you can bet that we’ll be watching and reporting on the full effects of this hastily written and potentially devastating progressive policy as it rolls out in St. Paul. 
 
“IS THE ARCTIC ICE ABOUT TO DISAPPEAR?”
Don’t listen to Greta – get the facts.  Here’s a terrific piece that outlines the hysteria from the Intergovernmental Panel on Climate Change and others that have predicted an ice-free Arctic for over 20-years.    You can read the report HERE.

IT’S TAX TIME!  
The annual report from our friends at the national Tax Foundation is out.  This is their report, entitled “Facts & Figures 2022:  How Does Your State Compare?” and it’s an excellent guide to state tax rates, state tax burdens and other important data points.

Most importantly, while most of us filed our returns this week and start to focus on the important elections coming up this November, this is a handy reference guide to see how our uncompetitive tax rates compare to the rest of the country.

You can read the full report HERE.

A REALLY GOOD IDEA FROM THE LEGISLATURE:
Rep. Hodan Hassan (DFL-Minneapolis) and Representative Peggy Scott (R-Andover) along with their senate counterparts, Senator Rich Draheim (R-Madison Lake) and Senator Ann Rest (DFL-New Hope) introduced legislation that would “require students to complete a personal finance course for credit during their senior year of high school and a course in government and citizenship in their junior or senior year of high school.”  The requirement would take effect in the 2023-24 school year.

Better informed graduates about our state, local and federal government who are also better equipped to deal with compound interest and who understand how to build wealth as they launch into adulthood – a real bipartisan win/win idea!

SERIOUISLY?  LEARNING HOW TO TATTOO WILL END RECIDIVISM?
“Minnesota Corrections hiring tattoo supervisor, hoping it leads to fewer reoffenders.”  I might suggest we consider training prisoners in jobs currently in high demand that welcome reformed felons and provide higher income potential.
 
REPORT:  CHILD POVERTY HAS BEEN CUT IN HALF SINCE 1996 WELFARE REFORM
One of the key benefits of the Republican-led 1996 Congressional welfare reform bill is that decades after its passage, “children today are half as likely to live in families below the poverty threshold.”

One of the key principles of that 1996 bill was that welfare beneficiaries were required to take positive steps towards achieving self-sufficiency.  These steps included finishing high school or studying for a GED or enrolling in a post-secondary education program.  It also made allowances for beneficiaries to work part time and not forfeit benefits.

The results were dramatic and important:  prior to passage, child poverty rates had remained stubbornly high but started to drop dramatically shortly after the bill became law.

Today, we’ve seen multiple attempts at both the Minnesota legislature and by the current Administration to roll back this progress and replace it with policies such as a “permanent child allowance” that would undermine the work and education policies that have helped the poorest of the poor escape deep poverty.  You can read a full report from The Heritage Foundation about the potential damage that might occur should we abandon these successful welfare reform policies.

WELFARE FRAUD & UNEMPLOYMENT FRAUD:  STEARNS COUNTY -- AGAIN
A St. Cloud grocer stole over $4 million in food stamp fraud and had the audacity to apply to the Minnesota Department of Employment and Economic Development (DEED) for COVID-19-related unemployment.  He netted $33,000 in unemployment benefits while running a food stamp fraud scheme that was so obvious that “investigators determined that the food stamp transactions totaled far more money than what there should have been for a store of Hormud’s (the recently convicted grocer) size.”  You can read the latest installment on how easy food stamp and unemployment fraud is in Minnesota HERE.

DON’T TELL ME THE STATE NEEDS TO RAISE TAXES
When you were a kid, did you ever spend your allowance foolishly and then sheepishly ask your parents for more money for something important – like cash to spend on a school field trip?  In my family, this was called a “teachable moment” and we were taught that if you spent your modest allowance on foolish things, you likely couldn’t be trusted to do better with more money.  It was a hard but important lesson to learn as a kid.

Apparently, some in state government never learned that lesson:  we learned this week that Minnesota’s publicly funded tourist agency, Explore Minnesota, recently agreed to fund a one-year, $65,000 sponsorship with Aurora FC (Minnesota’s new women’s soccer team).  This sponsorship includes an Explore Minnesota logo patch that team members will wear on their jerseys.  Explore Minnesota officials believe that seeing this logo will inspire women’s soccer viewers to travel to Minnesota to watch more soccer games.

Representative Jim Nash from Waconia raised some important and legitimate questions about this sponsorship and how exactly wearing a patch on a professional athlete’s jersey will inspire women’s soccer fans to visit Minnesota.  He correctly asserted that there are likely better ways to spend taxpayer dollars to lure visitors from afar to once again resume travel and to include Minnesota on that list of places to visit.

Tourism in Minnesota is serious business and many of those businesses that depend upon Midwest tourists patronizing our resorts, small businesses and restaurants have suffered mightily during the COVID-19 pandemic.  Perhaps Explore Minnesota will use their taxpayer-paid budget of $28.4 million more wisely in the future rather than squandering even the smallest amount away when businesses so desperately need help.
 
FACTS & FIGURES OF THE WEEK: DON’T LET THE RAIN OUTSIDE AND INSIDE (ON SOCIAL MEDIA) GET YOU DOWN

  • “75% of people in the U.S. never tweet.”
  • “On an average weeknight in January, just 1% of U.S. adults watched primetime Fox News (2.2 million), 0.5% tuned into MSNBC (1.15 million).”
  • “Nearly three times more Americans (56%) donated to charities during the pandemic than typically give money to politicians and [political] parties. (21%).” 
Axios Finish Line, March 7, 2022
 
 1. AMTRAK to Duluth Just Won't Die


2. Short Takes
 

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