In a throwback to the days of the New Deal, Minnesota's legislature has voted to give emergency relief to the state's Iron Range, which is on the brink of its worst economic slump since the Depression.
The $10 million relief package, voted in a special session Friday, is intended to ease the plight of the taconite iron ore producing region in northeast Minnesota, where overall unemployment is expected to rise this summer to 50 percent, and to 90 percent in some communities.
The compromise plan united legislators of both parties, and is expected to be signed Monday by Gov. Al Quie, who supported it despite a basic economic philosophy of supply-side Reaganomics. The measure sailed through the state House, 105 to 25, and the Senate, 52 to 12, with most of the nay votes cast by Republicans. It calls for state-financed public service jobs for the unemployed and "pump-priming" aid for small businesses.
The weak GOP opposition was based on arguments that other areas in the state also deserve help, rather than on traditional Republican opposition to government bailouts. Instead, the familiar objections came from both sides of the aisle.
Republican David Jennings, leader of the House minority, criticized "make work" remedies. And state Sen. Neil Dieterich, worrying that the bill would jeopardize long-term government solutions to Iron Range economic problems, became one of the few Democrat-Farmer-Labor members (as Democrats are called in Minnesota) to vote against the measure.
State Rep. Joe Begich, a DFL member from the heart of the Iron Range and the program's chief House sponsor, said, "We are not asking for a handout. We want to put people back to work to keep them off the welfare rolls and AFDC aid to families with dependent children and pump money into business."
Before the session he was asked whether the program in broad outline was not much like the work relief projects of New Deal days and he said, "Yes, but we don't call them that."
The bill combined with $2.5 million released earlier by the governor means four-week jobs for 9,000 unemployed who have exhausted unemployment benefits. They will receive the minimum wage of $3.50 for "public service" jobs such as park cleanup, reforestation on state property and similar jobs for local governments and nonprofit organizations.
Of the more than 22,000 unemployed workers on the thinly populated Iron Range, 8,700 have exhausted unemployment benefits and more than 3,000 applied for the emergency relief work even before the bill passed.
The measure will provide $7.5 million for the temporary job program and $2.5 million for longer-range projects intended to stimulate small business development in an area that relies primarily on open-pit mining of taconite iron ore.
The money will be taken from a $45 million trust fund financed by taconite production taxes. Until the emergency bill passed, the money was held for use after the year 2002. The idea was that it would be needed when the iron ore is depleted, but legislators of both parties from the Iron Range said, "The year 2002 is here now."
Taconite is low-grade ore that requires processing before it can be used in steel plants.