Iowa vs. Minnesota: Neighboring States Show Different Futures for America
There is no Berlin Wall or 38th Parallel separating Lyle, Minnesota, from Mona, Iowa, just 1.4 miles south along 1st Street, but the two towns are under governments with widely diverging visions. Iowa, once a “purple” state that leaned Democrat is now a “red” conservative state, while Minnesota, long a reliable Democrat state, has taken a radical, leftward turn. These neighbors exemplify the different visions for America that its citizens are likely to be offered in 2024.
Florida of the North
Iowa is earning the nickname “Florida of the North” thanks to the conservative policies being pursued under the leadership of Governor Kim Reynolds, who economist Stephen Moore dubbed “America’s Margaret Thatcher.” Whether it is pro-growth tax policy, protecting life, strengthening Second Amendment rights, safeguarding families, or battling left wing culture war policies, Reynolds is governing according to conservative principles.
Iowa has been a leader on several policy fronts. The first major piece of legislation passed in the state’s last session was the Students First Act, which created a universal Education Saving Account (ESA) for all Iowa families. In less than 72 hours when families could officially apply for an ESA over 10,000 did so. Reynolds led the fight for this measure. After the legislature failed to pass an ESA bill in the previous session, she got involved in several state legislative Republican primaries to support candidates who were pro-school choice.
Reynolds has been fighting for parental choice in education for several years. Prior to the passage of the Students First Act the legislature expanded charter schools and reduced barriers to open enrollment. In addition, during the COVID pandemic, she made sure that Iowa’s schools stayed open, reducing the harm done to children in other states which kept them closed.
Iowa has also been a leader in fighting radical ‘woke’ ideology. This session the legislature passed laws that prohibited sexually explicit books in school libraires, required parental notification for the use of pronouns, and banned gender identification and identity “education” in the classroom. Reynolds also signed a bill prohibiting sex change operations and other such medical procedures for minors.
The Hawkeye state is also a leader in pro-growth fiscal policy. What was, in 2019, the highest corporate tax rate in America at 12 percent is down to 8.4 percent now. Last year, Iowa led the nation in the “flat tax revolution.” By 2026, it will have abandoned its progressive, nine-bracket income tax in favor of a low, flat 3.9 percent rate. And the state isn’t done yet: Reynolds has stated that her goal is to eliminate the state income tax altogether.
Iowa has also led the way in slimming bloated government. A state government reform measure – the first major reform of Iowa’s bureaucracy in nearly 40 years – will consolidate government and make it more efficient, reducing the number of executive-level agencies from 37 to 16. It is estimated that this will save taxpayers some $214 million over four years. Reynolds has also issued an executive order to eliminate burdensome and unnecessary regulations. In its Fiscal Policy Report Card on America’s Governors 2022, the Cato Institute ranked Reynolds as the best governor in the United States. Iowa’s fiscal house rests on a strong foundation with the state running budget surpluses and reserve accounts full to their statutory maximum. It is estimated that Iowa will have a $2 billion budget surplus in fiscal year 2024.
Cold California
If Iowa is the “Florida of the North,” its northern neighbor, Minnesota, is increasingly known as “Cold California.” Governor Tim Walz and the Democratic-Farmer-Labor Party (DFL) won an unexpected ‘trifecta’ in November of Governor’s mansion and state Senate and House and, while their Senate majority is just one seat, won by 312 votes, they are governing like they won in a landslide.
Going into the session with a forecast budget surplus of $18 billion, the state is coming out of it with $10 billion in new taxes over the next four years and an increase of state government spending of 33% by 2027 and thousands of new state employees. While welfare has been massively expanded via child tax credits for low-income families, most Minnesotans will see their taxes go up.
Progressive fiscal policy has been matched with progressive social policy. Abortion is now legal up to the moment of birth as are sex changes for children. Recreational marijuana has been legalized, illegal immigrants have been granted free college, healthcare, and driver’s licenses – and registering for driver’s license also, now, registers you to vote – and felons have been given the vote.
The Education Bill continued Minnesota’s shift away from education and towards indoctrination by embedding ‘ethnic studies’ - defined as “the interdisciplinary study of race, ethnicity, and indigeneity with a focus on the experiences and perspectives of people of color within and beyond the United States” – into all academic standards; meanwhile test scores continue to fall.
Facing a surge in crime, Walz and the DFL are pursuing an approach which is entirely offender centric, focusing attention and resources on helping criminals, not the law-abiding public. "Earned incentive release," "clemency review," "automatic expungements," "prosecutor-initiated sentence reductions," and "supervision abatement" for probation are all aimed at reducing accountability and will serve law abiding Minnesotans poorly.
All of this is in addition to more radical environmental policies which will cause blackouts in the state without having any impact whatsoever on the global climate.
Two futures for America
Minnesota is being held up by progressives across the United States as their model. President Obama has lauded it and the New York Times and Washington Post, among others, have run glowing reviews. If you want to know what the left would do to America, pay close attention to what it is doing to Minnesota.
Daniel Henninger recently wrote in The Wall Street Journal that the “2024 election is about running the federal government on the red-state model or blue-state model…” Both Iowa and Minnesota offer contrasting visions for their respective states. They also offer contrasting visions for America. Which will we take? We hope the nation will choose the Iowa model.
John Hendrickson serves as policy director for Iowans for Tax Relief Foundation and John Phelan is an economist with Minnesota’s Center of the American Experiment.
