Minnesota Lawyer
Editor’s note: This is the first in a two-part interview Politics in Minnesota/Capitol Report conducted with Gov. Mark Dayton. The second half of the interview is available here.
While Gov. Mark Dayton’s selection of Minneapolis native Tina Smith, pictured, as his running mate created an all-Twin Cities ticket, the governor says he works on behalf of all Minnesotans. (File photo)
Rub elbows with public health experts and kindergartners. Collect checks from Beltway power brokers in Washington, D.C. Issue damning comments, which immediately get coverage in national media, on a star football player’s criminal case. React to good news for the state’s unemployment rate and a potentially crippling development for its health insurance exchange.
It’s all in a week’s work — last week, to be specific — for Gov. Mark Dayton, who these days divides his waking hours between administering the duties of the state and preparing for his re-election race against Republican nominee Jeff Johnson. The numbers all seem to be leaning in favor of the incumbent. The state’s unemployment rate dropped to 4.3 percent last month; Dayton and liberal groups are expected to have a big fundraising advantage; and each of several polls conducted has put the Democrat ahead of his GOP challenger. Most recently, and most dramatically, the Star Tribune’s Minnesota Poll gave Dayton a 45 percent to 33 percent edge to Johnson, in a survey which found 20 percent of respondents still undecided.
Dayton’s apparent strength heading toward the November showdown doesn’t mean he is without vulnerabilities. Though the campaign has yet to hit full volume, conservatives, from elected officials to outside operatives, have repeatedly hammered the governor on numerous issues, signaling the issues and events where they perceive Dayton as vulnerable.
Dayton sat down with Capitol Report for an interview to discuss themes that are expected to have an impact on the campaign; the first half of the interview focused on topics that Republicans think could weaken Dayton’s chances at winning a second term.
Capitol Report: Technological problems with MNsure’s launch were not as bad as what happened with the federal website, but led to a lot of frustration and consumer delays. Should you have been more active in that process?
Dayton: The main cause of the problems here was the selection of IBM-Curam, and maybe a couple of the other vendors, to put together the technological package. Maryland and Oregon made the same decisions in terms of the vendors, and suffered similar results. I was not part of making that decision. I wouldn’t have the expertise to make the decision. I think the decision was made in good faith, and the vendors were not able to do what they said they were able to do, and had done before. I deeply regret the bad start that MNsure got off to, but that’s the principal cause of the problem.
CR: PreferredOne announced that it was withdrawing from the MNsure marketplace, which could affect a majority of private insurance consumers on the exchange. Does that pose an existential threat to MNsure?
Dayton: I think when all the rates are released in the next couple weeks it will be clear what happened. But MNsure’s a marketplace. Like any marketplace, people come in and offer their products at certain prices, and lower prices tend to attract consumers. The question is, can a company break even or make a profit by providing the products at that cost. PreferredOne came in significantly lower than the other providers on MNsure, and they got about 60 percent of the market share as a result. Reading the tea leaves, it would appear they’re not able to continue to afford to offer the coverage at those rates. In that case, that’s a business decision for them to make. Republicans say they want a free market and competition in the health care system, and that’s exactly what this is.
CR: You ran on tax increases on the wealthiest Minnesotans, and were able to get those passed. What about the argument that those taxes punish people for being successful?
Dayton: If you look at the tax incidence study the Department of Revenue has published for years our state and local tax system is regressive, and especially regressive at the top. So, the top 1 percent and top 5 percent pay a smaller percentage of their income in taxes than middle income families. What I proposed to do from the beginning was … to address the deficits that we were facing … and also make the state’s overall tax system less regressive than it was initially. It’s not punishing anyone. I’m glad that people are successful, and can be successful here in Minnesota. It’s just asking the wealthiest 2 percent to pay closer to their fair share of the overall state and local tax burden.
CR: You and the DFL made some changes to the tax code in light of the positive economic forecast in 2014. Are you concerned that voters are going to see buyer’s remorse on something you signed-off on in 2013?
Dayton: Well, I signed an overall tax bill. I was not in favor of including the three [business-to-business] taxes out of the whole menu we started out with. Those were included, and then when our fiscal situation continued to improve … we were in a position a year later to rescind those taxes. The whole reason we proposed any of the tax increases we did in 2013 was because we owed the schools $2.8 billion, which a Republican governor and, then, in 2011, a Republican Legislature forced on the people of Minnesota. Fortunately, our economy improved, and we were able to make tax reductions. In fact, we also reduced taxes with federal conformity, and more than 2 milliion Minnesotans received income tax reductions.
CR: There has been a lot of criticism about the new Senate office building project. How will you explain to voters that it was necessary?
Dayton: It’s part of the overall redesign of the Capitol complex. My predecessors avoided facing up to [it], for some of these reasons, because it becomes a political football. Right now there are 39 senators who have offices in the Capitol building. The minority party is crowded over into the state office building with all of the House of Representatives. I thought from the beginning a new office building is necessary to get the senators out of the Capitol, out of clogging up that space, and allowing us to use it for other purposes better related to the public, and visitors and the like. So we went along, and had unanimous agreement on all aspects of Capitol renovations, including, a year ago August. Everything was proceeding, until an election year jumped in, and now it’s partisan. We reduced the cost of the project by about $10 million [in 2014].
People say this is self-serving. I’m out of the governor’s office for two-and-a-half years if I’m re-elected. This is a huge disruption for myself and for the Attorney General’s Office, which is something I willingly absorbed. I was the prime mover to say, we’re going to have to face up to this. We’re going to have to go through all the disruptions — and, I guess, the political food fight — in order to do what we need to do for the future of the Capitol.
CR: You and [lieutenant governor candidate] Tina Smith both come from and live in the Twin Cities area. How can you relate to rural Minnesota voters?
Dayton: I’ve been traveling all over this state for the last 39 years. I’ve been to more places in Minnesota, and more often, than any of my [Republican] opponents early in the race, and certainly now. I think I’m well known to Minnesotans all over the state. I continue to travel all over the state. I think if people know anything about me they know I care about all of Minnesota.
CR: Are there issues, like on gay marriage or school bullying, where the DFL’s progressive urban leaders have been a step ahead of public opinion in outstate areas?
Dayton: There are different views, certainly. I support marriage equality, and I think we needed a stronger anti-bullying statute. I didn’t view those as metro-rural issues. They affect the entire state. There may be more people in certain parts of Minnesota that have one opinion versus another, but I didn’t view those in a metro-rural context.
Note: This interview has been edited for clarity and length.
