Free-dumb Caucus members attack Governor’s State of the State address

I did notice that a few of you have been grousing because you didn’t care for me pointing out the unforced error from yesterday’s state of the state address.   Good people can agree to disagree.

But if you’re looking for what an attack on the administration actually looks like, look no farther than the self-important South Dakota Free-dumb caucus’ latest press release from Republican party pariah Rep. Phil Jensen, Senator California Carley and others who attacked the Governor’s proposal, declaring “outrage” and calling it “Crony Capitalism” and “Centralized Economic Planning”:

Contact: Representative Phil Jensen
Telephone: (605) 209-7404
E-mail: [email protected]

CAUCUS RETURNS TO BUSINESS AS USUAL: STATE PLANS FOR MORE CRONY CAPITALISM

PIERRE, S.D. — This week the South Dakota Freedom Caucus returned to the Capitol for 40 legislative days of fighting for freedom over favoritism. Immediately back, the citizens were presented Tuesday with Governor Larry Rhoden’s State of the State address, which was a mixed bag of encouraging South Dakota values, along with plans for future crony capitalism.

The South Dakota Freedom Caucus issued an expansive warning of the theme of Governor Larry Rhoden’s State of the State address, warning that the administration’s “Opportunity Agenda” is a blueprint for centralized economic planning that betrays free-market principles and mirrors systemic corruption seen in neighboring states.

The caucus argues that Governor Rhoden’s vision relies on state agencies acting as “economic allocators,” using the Future Fund to pick winners and losers by handing out taxpayer dollars to politically favored corporations. This interventionist model, the caucus warns, gives unfair preference to select businesses while forcing the rest of South Dakota’s entrepreneurs to compete against their own tax dollars.

“True conservatism is about a level playing field, not a government-steered marketplace where bureaucrats decide which projects are ‘bold’ enough for public subsidy,” said Senator John Carley (R-Piedmont), Vice Chair of the South Dakota Freedom Caucus. “What we heard today was not a celebration of the free market; it was an endorsement of a managed economy. Using the Future Fund to distribute taxpayer-funded aid to select corporations while our own small businesses struggle to keep the lights on is not economic growth—it is the definition of crony capitalism.”

Caucus leaders expressed particular outrage at the Governor’s decision to explicitly celebrate the CJ Schwan’s development from the podium. The project is currently embroiled in a mounting ethics scandal involving a “revolving door” between the Governor’s Office of Economic Development (GOED) and private beneficiaries. Reports have highlighted that former GOED Commissioner Steve Westra, who oversaw the initial aid to the company, is now a Vice President for the firm. Additionally, the current Chair of the state Board of Economic Development, Jeff Erickson, maintains deep ties to the very company receiving millions in state grants and tax rebates.

“It is a slap in the face to South Dakota taxpayers for the Governor to take a victory lap on a project currently clouded by documented ethics concerns,” said Representative Phil Jensen (R-Rapid City), Chairman of the South Dakota Freedom Caucus. “We’ve seen what happens when government agencies operate without accountability—look at Minnesota, where the ‘Feeding Our Future’ scandal resulted in the defrauding of over $9 billion or more of taxpayer dollars. South Dakota is heading down that same dangerous path when we allow a revolving door to spin between regulators and the corporations they subsidize. Highlighting CJ Schwan’s as a success story while these questions remain unanswered proves that this administration is more interested in protecting the powerful, not the people.”

The Freedom Caucus also challenged the Governor’s celebration of massive federal funding inflows, specifically the $189.4 million award mentioned in his address. Aaron Aylward (R-), former Chair of the Freedom Caucus, argued that “’federal dollars’ do not come from some magic pot of money from elsewhere – these are our income taxes, as well as the printed money that causes inflation and are a large part of the reason that everyone demands ‘cost of living’ increases.” Also, the caucus pointed out that federal dollars are not free dollars and that leaning into Washington’s purse strings inevitably compromises South Dakota’s sovereignty.

“Federal dependency is a drug that masks the underlying rot of a growing state bureaucracy,” said Representative Tina Mulally (R-Rapid City), Treasurer of the South Dakota Freedom Caucus. “Governor Rhoden celebrates nearly $200 million in federal handouts as a ‘win,’ but every dollar from Washington comes with strings attached that ultimately tighten around the necks of South Dakota taxpayers. If we want South Dakota to remain free, independent, and self-governing, we must stop building our budget on the shifting sands of federal debt.”

While the caucus commends the Governor for his recognition that property tax is a vitally important topic that requires action, many worry that the Governor’s property tax proposal is a “shell game” designed to distract from the need for genuine spending restraint. Rhoden’s plan to allow counties to replace property taxes with a half-cent sales tax was framed by the caucus as a step in the right direction, but not near far enough, with the detrimental side effect of no requirements for government to curb spending.

“Replacing one tax with another is not tax reform; it is a tax shift that keeps the government’s footprint exactly the same size while shifting the bill to the another taxpayer,” Mulally added. “By moving the burden from property owners to everyday transactions, the Governor is merely rearranging the furniture in a burning house. Real relief starts with right-sizing government and cutting spending—not creative bookkeeping.”

In contrast to the Governor’s proposal, Senator Carley has introduced SB 58, which would take the bold step of reducing property tax mill levies to zero, forcing the state to address its spending habits rather than just finding new ways to bill its citizens.

“The people of South Dakota didn’t send us to Pierre to swap one tax for another; best case, that can buy some time for real relief” Carley concluded. “They sent us here to eliminate the burden. SB 58 is one of the few serious proposals on the table that offer a path to permanent relief by dismantling the property tax machine entirely.”

Governor Rhoden also discussed his GRIT tax force, in which he seems sincerely to be looking for solutions to state-wide infrastructure failures and security as a state. However, more government involvement is not the solution, and the caucus warned that historical examples of government takeovers of infrastructure have not ended well, and result in rationing and government control of who is allocated power, water, and gas. While utilities do not fall under real “free market” principles this is not a direction that South Dakota should go. Infrastructure and the security thereof is a massive need, and the caucus encourages the companies involved in that to shore up their defenses without government takeovers.

The South Dakota Freedom Caucus is calling on the Legislature to reject this move toward centralized planning and return to the principles of limited government, transparency, and the free market.

Isn’t Tina on the executive board for the SDGOP as their treasurer complaining about State Government’s creative bookkeeping?  I seem to recall her name on all those reports that show zero donations..  Anyway, we’ll have to see how California Carley’s and the rest of the crew’s legislation fares.

And session moves on.