Pawlenty stands firm on his mantra that cuts are the key to job creation

ST. PAUL -- Gov. Tim Pawlenty delivered equal amounts of patriotism and conservatism Thursday in his final State of the State speech.

The Republican governor and potential 2012 Republican presidential candidate began his 33-minute speech praising the Minnesota National Guard, and spent much of his time in the packed House chamber promoting tax cuts and other proposals that he said would help business hire more workers.

Reception to his speech was divided along partisan lines more than his previous seven. Pawlenty was interrupted for applause 25 times, although most Democrats joined in only about a half-dozen times.

The GOP governor talked about what he sees as the state's poor tax climate for business and said government should shrink, all in the name of helping create jobs.

"So the most important question before us is this: How do we best grow good, private-sector jobs in Minnesota?" Pawlenty asked. "The people who can best answer that question aren't in this room. They're not in Congress. They are not in the White House. They're not in bureaucracies. In fact, they're usually not in government or politics at all."

The governor said businesses are in the best position to help the economy, but state government needs to help them with lower taxes and a streamlined path to receive permits and licenses that government grants.

The speech was Pawlenty's eighth and final State of the State, and his most closely watched nationally since he is a possible presidential candidate. Pawlenty sprinkled in national references, but national political observers were expected to be most interested in how closely the Republican governor adhered to conservative ideals on Minnesota issues.

The speech wrapped together things Minnesotans have heard from Pawlenty previously with themes like smaller government that he has pushed in 19 out-of-state appearances since he announced he would not seen a third term as governor last June.

Pawlenty did not go in depth into how he would solve a $1.2 billion budget deficit. That will be his subject Monday, when he releases budget tweaks.

He suggested that the Legislature make permanent the $2.7 billion in budget cuts he made last year, something most Democrats have criticized.

The governor repeated a comment he often has made in recent years, that since he was born in 1960 state government spending increased 21 percent in every two-year budget, until he became governor.

"During my term as governor, we've dramatically slowed down state government spending and we actually cut spending for the first time in Minnesota history," he said.

In the past, Pawlenty added, leaders of various political philosophies "believed the presumed benefits of big government outweighed the big tax burdens placed on our citizens and job providers."

He said the state needs to cut business costs, by trimming their taxes.

"Companies make common sense decisions to grow and add jobs where it cost less," he said.

Pawlenty called for renewing the Job Opportunity Building Zones program designed to attract business to rural areas, mentioning how it helped Minnesota Twist Drill in Chisholm remain in the state and expand.

"Using JOBZ and some other tools, they kept the company here and have more than doubled employment to 130 jobs in an area that desperately needs them," Pawlenty said.

JOBZ provides elimination of taxes for a period of time for new and expanding businesses in parts of the state.

Much reaction to the speech split along party lines, although some Democrats praised Pawlenty's speech. Many Democrats said Pawlenty was playing to a national audience because of his presidential hopes.

"Gov. Pawlenty's final State of the State address was just the latest stop in his public-speaking tour across the country, designed to help him pander to big-business CEOs and further his personal ambitions," said Brian Melendez, chairman of the state Democratic-Farmer-Labor Party.

But former Gov. Wendy Anderson, a Democrat, praised Pawlenty's speech as what was needed for a tough economic time.

"He played a very difficult hand well," Anderson said.

House Minority Leader Kurt Zellers, R-Maple Grove, said Pawlenty mirrored business owners who want lawmakers to "get off our backs and get out of our way."

House Majority Leader Tony Sertich, DFL-Chisholm, said tax cut proposals will worsen the deficit. He disputed claims that Pawlenty has produced balanced budgets and added jobs.

"Flat out it's not true," he said.

"It does sound like the axe is back as a budget-cutting tool," said House Speaker Margaret Anderson Kelliher, DFL-Minneapolis. "That is going to be of concern to a lot of Minnesotans."

Sen. Steve Dille, R-Dassel, said there are too many sex offenders in prison already, disagreeing with Pawlenty's call for longer sex offender sentences.

"We need to work more on treatment and getting some of them out of the system," Dille said.

He agreed with Pawlenty in other areas: "We have to cut the size of government. It's a long-term problem.

Rep. Larry Haws, DFL-St. Cloud, said Pawlenty's no new taxes strategy already caused increases in tuition, property taxes and public school class sizes.

"They balanced the budget on the backs of the students," Haws said.

Rep. David Dill, DFL-Crane Lake, said he thought the Pawlenty speech was aimed at Minnesotans more than a national political audience

Rep. Andrew Falk, DFL-Murdock, thought the address was for a national audience. He said he liked Pawlenty's discussion of improving the state's business climate, but wants more details.

The focus on jobs sunk in with Rep. Dean Urdahl, R-Grove City.

"He said a lot of good things, particularly in the jobs area," Urdahl said.

Rep. Tom Rukavina, DFL-Virginia, one of eight legislators running for governor, said he was glad it was the last Pawlenty speech he would need to hear. The governor went into office with a nearly $4.6 billion deficit and is leaving in a year with one that will be bigger, the lawmaker said.

For Rep. Tim Kelly, R-Red Wing, the speech was good.

"This was a very specific speech," Kelly said.

Count Sen. Kathy Saltzman, DFL-Woodbury, as one of the legislators who appreciated Pawlenty's emphasis on jobs.

"We want to partner with him on that," she said.

However, Saltzman added, the state needs to look for ways to identify businesses that are thinking about leaving the state and to attract new ones.

Davis and Tellijohn report for Forum Communications Co.