New Minnesota business lobby is unapologetically partisan

Minnesota's newest business lobby, led by the Republican who came closest to winning statewide office last fall, is already on a high wire.

The Minnesota Private Business Council is trying to distinguish itself from trade associations and chambers of commerce. It will zero in on the state's economic growth and the taxes businesses face rather than industry-specific issues. Also unlike those groups, it's not putting on a veneer of bipartisanship.

"We're an organization that believes that it's really important that Minnesota have a robust voice from the center-right," Jim Schultz, the group's executive director, said in an interview Tuesday.

Trouble is, Minnesota's conservatives and moderates have been squeezed out on financial matters because the Republican social agenda is unconscionable to many Minnesotans.

Schultz, a Minneapolis attorney, recognizes this better than most in the GOP. He lost his attempt to unseat Attorney General Keith Ellison, by less than a percentage point last November. It was one of the strongest showings by a Republican candidate for statewide office since Tim Pawlenty was re-elected governor in 2006.

The group also announced on Tuesday that it had attracted dozens of members and more than $600,000 in dues since forming two months ago. Some of the initial members include Cambria, the maker of quartz countertops in Le Sueur and Belle Plaine, and A.H. Hermel, the food wholesaler based in Mankato.

Tom Rosen, chief executive of Rosen's Diversified Inc., a beef processor and agriculture services firm in Fairmont, and Todd Paulson, chief financial officer of RTP Co., a thermoplastics maker in Winona, will co-chair its board.

Its first political goal is to end the Democratic trifecta in the Legislature and governor's office, Schultz said. That means flipping six seats in the Minnesota House to Republican control in the 2024 election. Senate seats and the governor's office won't be on the ballot until the 2026 election.

The group will look for candidates who can persuade independent and some Democratic-leaning voters that the financial costs of the DFL's trifecta are too high, Schultz said.

On the surface, that shouldn't be too hard. Lawmakers and Gov. Tim Walz raised the state's spending for the fiscal 2024-25 biennium, which began this month, by the most of any two-year period since the 1970s. It far outstripped the state's economic growth.

They imposed sheaves of new regulations, raised corporate taxes and flirted with creating a new tax bracket for high-income Minnesotans. "We think it was the worst session for jobs and wages in Minnesota's history," Schultz said.

But the problem for Minnesota's Republicans and backers like the Minnesota Private Business Council is that the party's positions on abortion and other social issues are so unpopular. On those, Republicans come off not as center-right, but as extreme right.

In 2020, the GOP made gains in Minnesota despite the seven-point loss Donald Trump took in the presidential race in the state. But after the Supreme Court's abortion decision last year, Republicans gave up most of those gains.

Schultz felt that directly. Ellison painted him as an anti-abortion zealot while he attempted to tell voters it wasn't something the state's attorney general would face as an issue.

In our talk yesterday, Schultz distilled the pitch for divided government this way: "People might be uncomfortable with the Republican Party for any number of reasons. But if you're that person, you should still want a Republican House if you're uncomfortable with what the DFL produced this last session."

Midway through the legislative session, as Democrats' aggressive spending became more clear, Walz started framing their work in terms of national cultural issues. He started talking about book bans and constraints on individual rights that GOP policymakers were pursuing in other states.

"The forces of hatred and bigotry are on the march in states across this country and around the world. That march stops at Minnesota's borders," he said in his State of the State speech in April.

There's a chance that the 2024 election will replay on the culture-war terms of 2022 or, worse, that extremists in both parties will play a bigger role.

Both scenarios would push aside finding solutions to the big economic problem facing Minnesota, which is that demographic forces are producing more labor scarcity here than in the nation as whole.

The retirement of baby boomers has stalled out the size of the Minnesota workforce, producing a drag on economic growth. We won't know until at least this time next year whether the new programs the Democrats enacted this spring will counter the effects of that drag — or whether their costs will add to it.

If it's the latter, I'll be closely watching Schultz's drive to find Republicans who are palatable to more Minnesotans.