What a Leader Looks Like
Like most of us, I continue to reflect on this past session, and track what’s going on nationally – debt ceiling debate, interest rates, workforce challenges, etc. The Pew Research Center out of Washington D.C. describes the U.S. as having become “exceptional in our political divide.” And what I’m looking for is leadership to get us through. So I listen. And read. Today, my thoughts on leadership are those of David Gergen, a political independent, a senior political analyst for CNN, and the founding director of the Center for Public Leadership at the Harvard Kennedy School. Gergen is a former presidential advisor who served several administrations and he wrote about those experiences in his New York Times best seller, Eyewitness to Power: The Essence of Leadership, Nixon to Clinton. His thoughts on what it takes to be a good leader might surprise you.
David Gergen on leadership, in an interview at Duke University’s Fuqua School of Business in 2014:
I always thought that the best leader would be the smartest person in the room. Follow the smartest person and you’ll get the best results.
What I’ve learned:
I hope you know leaders like this; I hope you vote for them. My encouragement is that you strive to be one of them because we need you!
See you in the trenches,
I’m sure you have been tracking end of session negotiations this past week. And Amanda’s commentary on Thursday about being silo’d certainly resonated with me. Folks, I feel compelled to share with you what’s been on my mind these last 2 weeks: we may be down, but we are NOT out.
Living within a democracy requires that we make room for positions that are wildly different from our own. What I know is, despite my vociferous opposition to several of the final reports coming out of conference committees, that all who serve this great state – in whatever capacity – do so because we care deeply about our future. I haven’t yet figured how to ensure that service is more collaborative.
Read more in my blog…
This month my personal life has been consumed by a family tragedy. One of my brothers, not yet 60 years old and a U.S. Army veteran, died suddenly. The remaining 7 of us, spread out across the world, came together to honor his life, bury him at Fort Snelling, and talk about our future “one man down.” In this little family, too, are wildly divergent views on what we need for a more healthy, connected future. And yet we all care deeply about that future.
People puzzle me.
What’s on my heart and mind is that we can’t give up. Whatever it is we care deeply about, whatever we feel called to advocate for, we must continue doing that thing. No government is healthy absent strong, loyal opposition. If that’s the role of business right now, to thoughtfully oppose policy we are deeply concerned about, then so be it. But we will not give up. We will continue to wrestle, to advocate for, to represent the positions that support a thriving economy – one that facilitates a strong business climate. If you are familiar with Simon Sinek’s concept of the “infinite game,” know that we continue to work to be better than we were yesterday. And we want the state to be better than IT was yesterday. That is the work we continue, on your behalf.
See you in the trenches,
I hate to be negative, but there’s a lot of troubling proposals that are nearing the finish line at the Capitol.
Throughout the legislative session, our Chamber has expressed concerns with the Paid Family and Medical Leave (PFML) legislation. I’m worried about the long-term costs of this state-run program, both to the state budget and the compliance costs for counties, cities, and school districts (which will translate to property tax increases).
In this challenging labor market, a strong benefits package is a key tool for employee recruitment and retention. A shift to a state-run program, and the associated payroll tax increases, would likely mean the loss of existing benefits for many employees.
For these reasons, I’ve always favored an incentive rather than a mandate. That’s why I’m pleased to see there truly is a better alternative. The Minnesota Family and Medical Leave Insurance (MN FaMLI) plan would be an elective, cost-effective insurance policy that could be made available to all employers and employees in the state. Small businesses would be offered a tax credit to address the affordability of the plan. Individual workers could opt-in for $5/week if their employer did not participate. This would allow workers who enjoy their current benefits to keep them, rather than being moved into a one size fits all state program. Best of all, this private option would be back by an insurance company, not taxpayers, and would not require 400+ state employees.
As the Senate debates the PFML bill today, I truly hope lawmakers will recognize that this is a more cost-effective and workable option that deserves their support.
I’d also like to talk about taxes. I know in Minnesota we always want to be leaders. But do we really want to be the first in the world to adopt mandatory worldwide income reporting? This is unbelievable to me, so I’m glad to see that the Senate appears to backed away. And the fifth-tier income tax will further make our state a tax outlier and perpetuate an unfriendly business climate. And the fact that full elimination of social security benefits is not included in the tax bill will do nothing to stop the exodus of income from our state, which IRS data shows is clearly happening.
I’m disappointed that sitting here with a $17.5 billion budget surplus, this is the direction our state is going.
See you in the trenches,
The Heights… It’s Happening!
April 25, 2023 was a great day for housing in St. Paul. On that day, Sherman Associates announced its partnership with the Port Authority as lead developer for a $400M housing development at The Heights (former Hillcrest Golf Course). This is a great day because the plan is for 1000+ housing units on the East Side, for all ages and all incomes including workforce market-rate, affordable, and deeply affordable housing. This project will include a mix of housing options for sale and rent, focusing on the “missing middle” of young, large, multigenerational, and senior households. I’m loving this!
The most visible partners also were at the announcement: Ramsey County, Mayor Carter and the City’s Planning and Economic Development leadership, JO Companies, and Twin Cities Habitat for Humanity. County Commissioner Mai Chong Xiong spoke the importance of new investments like this on the East Side, particularly as a vehicle for generational wealth-building. Mayor Carter was particularly inspiring, wrapping up his comments with: “when our children decide where to live and plant their businesses, what will they be looking for? I think they will choose The Heights.” JO Companies is owned and led by Johnny Opara, a developer of color who grew up in Saint Paul’s Rondo neighborhood. This is his 2nd housing project in his home town (the first is The Hollows, newly opened, near Railroad Island). And Sharon Sayles Belton, former Minneapolis Mayor, current executive at Thomson Reuters, and a Habitat Board member, spoke on behalf of the organization, ultimately sharing that this project would be the largest in their history.
The project will be under development through 2029. Stay tuned for more industrial development announcements at The Heights coming soon!
See you in the trenches,
Things are weird right now.
Last week St. Paul’s Mayor Carter gave his State of the City and Governor Walz his State of the State. Mayor Carter celebrated the work underway intended to drive a vibrant, sustainable, and innovative St Paul, while the Governor outlined plans for a second “Minnesota Miracle.” At the federal level, President Biden positions himself for reelection, advancing big government – and bigger spending. Meanwhile, Minnesota experienced a net migration out of the state in 2022. The state’s unemployment rate fell again to 2.8% in March, even as the private sector lost 6100 jobs. Nationally, we have strong labor market data, and yet 75% of Americans are worried about widespread job losses. And we are wrestling over increasing the national debt ceiling. Again (the national debt recently topped $31T for the first time in U.S. history, just 8 months after it crossed $30T).
I’m just not sure business is picking up what the politicians are laying down. Do you feel me?
Regarding the City: The Star Tribune listed 6 takeaways; worth reviewing. Mayor Carter’s top priority right now is the proposed St. Paul's 1% local sales tax proposal, which would collect nearly $1 billion for street and park maintenance over 20 years. To pass, the tax would need to be approved by the Legislature and St. Paul voters — neither of which are done deals. As you know, the Chamber has testified in opposition to the proposal, which currently is not included in the House’s tax plan unveiled last week. Also ahead this year is a shake-up at the City Council, with all 7 members on the ballot this fall and just 3 members seeking reelection.
Regarding the State: like many of you I’m sure, I follow Blois Olson. I appreciate his thoughtful analysis of any number of policy issues. He offered his takeaways that I thought were particularly interesting. I responded specifically to his comments: “the Governor definitely made a decision to double down on a very progressive agenda….There’s a sense among many that the bets on paying for childcare, a 5th tax tier, spending the surplus, are risky. If they work, it’s a ‘miracle’ for our economy.” That said, “we’ve had net migration out of the state…we are in a state of transition….a lot of people don’t know if it will work.” Ultimately, the Governor wants to out-spend the surplus and increase the state’s budget by 30% to a total of $71B in the next biennium, including spending that will come with financials “tails.”
I don’t have any answers today. I’m looking at economic indicators and responding to trends (reactions?) I’m seeing from within the business community. And, again, things are weird. When policy issues or the economy are in “transition,” when business is uncertain of what’s ahead, so many – under the “abundance of caution” approach – retract. Retreat. Hunker down. I’m seeing that response now. Economic indicators are stable, business activity actually surged in March, the PMI is over 53 now…yet many businesses are “ducking.” To avoid what, I’m not yet sure.
See you in the trenches,