Minnesota thrives, Rauner fails on jobs

The following is a guest commentary that recently appeared in the The State Journal Register of Springfield, Illinois.

 

The numbers tell a harsh story: since Gov. Bruce Rauner came to office in January 2015, Illinois has been one of only four states nationwide and the only Midwestern state to have lost population.

Job growth sags at a paltry 0.7 percent—less than one‑fifth the national average—while the state’s unemployment rate surpasses the national average. Illinois’s median household income growth over the last two years ($2,700) trails the national average by $500. GDP growth limps along at about half the national average. Most strikingly, total wages in Illinois have declined since the beginning of 2015.

Governor Rauner’s response to this poor record has been to claim that he’s “not in charge.” The fault, he insists, lies with legislators who have rejected his agenda items such as creating local “right‑to‑work” zones, cutting the prevailing wage and curtailing collective bargaining rights. Rauner went so far as to veto two state budgets over the dispute, sparking an impasse that drove up state debt and wrought havoc on the Illinois economy.

Nearby Minnesota has pursued a much more worker‑friendly agenda. Democratic Governor Mark Dayton not only resisted “right‑to‑work” and other anti‑union measures, but actively worked to enhance the rights of working people and raise their standard of living. Minnesota increased its minimum wage from $7.25 to $9.50 per hour and indexed it to inflation to keep pace with rising consumer costs. The state raised $2 billion in new revenues, mostly from the wealthiest Minnesotans, to invest in K‑12 and higher education, affordable health care and housing, lower property taxes and fund local government services. And, thanks in part to Dayton’s leadership, union membership—which fell by 10 percent nationally from 2016 to 2017—increased by 46,000 (13 percent) in Minnesota.

Contrary to naysaying from Dayton’s political opponents who claimed that these pro‑worker policies would ruin Minnesota’s economy, the state has done well. Since January 2015, its job growth has been above the national average, more than six times greater than Illinois. Unemployment is among the lowest in the nation. Median household income has grown slightly more than the national average. Minnesota’s GDP growth is well above the U.S. average and more than double Illinois’s. Finally, since 2015—while Illinois was losing people—Minnesota’s population has increased more than the national average.

The Republican governors of Indiana, Missouri and Wisconsin have, in Rauner’s defense, blamed Illinois’s poor economic performance on Democrats. But Minnesota has outperformed each of these states in terms of job, population, wage, and GDP growth over the last decade—a period including the entire Great Recession and subsequent recovery. Among these states, only Minnesota has seen median household income growth above the rate of inflation over this period; Illinois, Indiana, Missouri and Wisconsin each experienced a decline in real median income.

A state’s economic fortunes are not entirely the product of decisions made by governors, and governors rarely deserve all the credit or blame for their states’ performance. But while some of Illinois’ problems predate Governor Rauner, his policies have failed to ignite growth or reverse Illinois’s downward trajectory. Minnesota—which has outperformed Illinois and other anti‑labor neighbors—shows that progressive policies and economic prosperity can go hand in hand.