Billionaire Governor Taxed The Rich & Increased Minimum Wage: Look What Happened collective-evolution
When Minnesota governor Mark Dayton took office in January of 2011 he inherited quite the difficult situation to turn around. The midwestern state was drowning in a $6.2 billion budget deficit and had a troubling 7% unemployment rate.
Coming in on the heels of Tim Pawlenty, a leader who failed to generate any substantial new revenue and created only 6,200 new jobs, the pressure was on for Dayton to do better. As the billionaire heir to the Target fortune, many didn’t expect Dayton to be capable of much of anything, but now, over 5 years in office, he has effected real change for the North Star State.
To do this, Governor Dayton implemented two key factors that to many may seem commonsensical: he implemented higher taxes on the rich and increased minimum wage.
The income tax increase impacted individuals earning over $150,000 and couples combining to earn over $250,000, as they were now taxed at a rate of 9.85% (up from 7.85%). This hike has since helped the state drastically chip away at its budget deficit, including in 2013 when the New York Times reported that Dayton’s change had raised taxes by $2.1 billion that year.
The minimum wage has been promised to be raised to $9.50/hour by 2018, and currently sits at $9.00/hour after most recently being bumped in July of 2015. The July increase is the second wave of the planned three-stage increase that has made Minnesota into the state with the highest minimum wage in the Midwest. (source)
In addition to the wage increase, Governor Dayton also passed a state law guaranteeing equal pay for women.
How Effective Has This Been?
Between 2011 and 2015 over 172,000 new jobs were added to Minnesota’s economy, a positively startling number when compared to the 6,200 his predecessor managed to create. Minnesota now stands tied with the 7th lowest unemployment rate in the United States at 3.5%, as reported by the Bureau of Labor Statistics in December of 2015.
Overall as a state, there are expectations of a nearly $2 billion budget surplus through 2017. (source)
Governor Dayton’s methods have not been without criticism, largely rooted in a fear that this tactic would drive away the big corporations/job creators, but it is certainly hard to argue with the results thus far.
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What are your thoughts on the progress that Governor Dayton has made in the state of Minnesota? Do you agree with his approach? Or do you feel that it is not a feasible solution? Let us know via the comment section below.
I personally enjoy coming across stories and statistics such as this, especially when they involve uncommon solutions that seemingly work to aid problematic situations. At this point there is, to me, overwhelming evidence that corporate interests dictate far too much of the political landscape — something that Presidential Candidate Bernie Sanders recently exposed during a live debate.
While I do not necessarily support everything behind Bernie’s campaign, I do appreciate his willingness to make such a bold statement to the public. To find out more about the stances of Joe and I, from the CE team, on Bernie’s big reveal I encourage you to check out the following segment from our new These Guys episode:
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