Live blog: Governor weighs in on new forecast
11:38: Governor is finished, headed back into his office.
11:36: Asked about his increasingly vocal criticism of federal spending, Pawlenty responds: "I don't limit my criticism of federal spending to what's going on currently. Whether a Democrat or Republican has been in the White House... it has been about the same. In my view, you have the fox watching the chicken coop..."
11:33: Once again, Pawlenty refers to Secretary of State Clinton encouraging China to keep buying debt, predicts that federal debt will cause a government version of the subprime crisis. Calls stimulus plan "porky" and "earmarky," and says its a spending spree, not a meat and potatoes stimulus plan. "This thing is unsustainable both at the federal level and the state level."
11:31: Pawlenty returns to statewide public employee wage freeze idea. "It will minimize, if not eliminate, government employees being laid off."
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11:28: Governor says education will still be "held harmless," and perhaps increased.
11:26: "We have to be competitive... we need to be a more job friendly, business friendly state," Pawlenty says. He notes that all other states that have had better job growth had smaller costs of government. Pawlenty said earlier that this may be the first time in history that Minnesota state government shrank over a biennium. (It has shrunk on an annual basis before.)
11:23: Pawlenty is asked if the stimulus plan will have some unintended consequences, like forcing cuts in other areas that are not addressed by "maintenance of effort" requirements from Washington. He says there are some state programs that may be subject to cuts.
11:20: Pawlenty demurs on the possibility of revisiting his earlier plans to balance the budget, including holding the line on education and cutting human services, particularly health care. "We will have a balanced budget," he says, in conformity with the state's constitutional requirements.
11:10: Asked about the out years, state budget comissioner Tom Hanson asks the crowd to remember May 30, 2007, when the current budget was passed. He says that budget was balanced for the out years, too. Presumably he's noting that the state's ability to foresee the future is limited at best.
11:08 Pawlenty says stimulus money has some strings that prevent changes in eligibility for medical benefits, but that the rules may not prohibit changes in the "benefit set" that the state offers. There's a lot of discussion about "maintenance of effort" stipulations that go with the federal stimulus money.
11:06: Pawlenty on $4.6 billion shorftall: "This is about what we expected. We will have a supplemental budget out in a few weeks or sooner...We should not be raising taxes on people or business that are employing people."
11:00 -- Governor Tim Pawlenty is holding a press conference in his office right now. "As we balance the budget, state government needs to reflect the realities that families and business are facing. We need to focus on creating an environment that will grow jobs, tighten the government's belt by reducing spending, and avoiding making the situation worse by raising taxes."