Gutknecht or Oberstar - Who's got the better RAIL Plan ?

At Gil Gutknecht’s DM&E /FRA meeting in Rochester last Friday, Kevin Paap, a Garden City farmer who represents 30,000 farmers as president of the Minnesota Farm Bureau, said "Farmers across southern Minnesota are waiting for a bigger, better rail line to get crops and renewable fuels such as ethanol to market more efficiently.”

As I stated in a previous commentary, ( http://minnesotacentral.blogspot.com/2006/08/gil-how-is-dme-going-to-help-me-23.html ) I addressed how the movement of coal will not help 2.3 million electricity consumers in our region and that the farmers are not guaranteed any lower pricing thorough DM&E trains.

However, based on Mr. Paap’s concern, I did a little more searching.

Since Mr. Paap referenced ethanol, as of September, 2005, 40% of the US ethanol production was in Minnesota (16 facilities built or under-construction) and Iowa (with 23 facilities) and it seems that every month another facility is being planned to be built in Minnesota. DM&E currently is one of 23 railroads operating in Minnesota over 473 miles of track out of 4,457 total miles.

So, here is the question, does it make sense for all the money go to one railroad ?

At FarmFest, Gil Gutknecht re-affirmed his support for the DM&E loan program.
From The New Ulm Journal :
“I’ve taken lots of arrows from Rochester people, but I won’t try to kill the (DM&E) railroad project,” said Gutknecht.
The The Rochester Post-Bulletin reported the FarmFest debate :
Gutknecht at one point chided Tim Walz for expressing support for DM&E's expansion, even though Walz said last week that he opposed the $2.5 federal loan sought by railroad President Kevin Schieffer.
Walz said he has always supported the project, but as a fiscal conservative could not support the loan. Asked whether the project was possible without the loan, Walz said, "that's what we need to find out."

A little history, for those of you who may not know the particulars.
The Federal Railroad Authority's program was designed to help railroads fix existing track with impetuous that small railroads would need the monies. The White House, and even the Republican Study Committee (Gutknecht has endorsed these proposals), wanted to cut the budget. But somehow Senator John Thune (and former DM&E lobbyist) changed the TransPORKtation Bill for 2006 by a decimal point--from $3.5 billion to $35 billion. And further, it required the FRA to give priority to projects like the DM&E's that "alleviate rail capacity problems" and removed any prohibition on the size of any single loan. Many legislators were not aware of the last minute changes made by Sen. Thune. There was no up and down vote on this provision. There was no transparency for the public to know what was being discussed.

In May, Congressman Gutknecht wrote a letter to the FRA requesting a review of the proposed DM&E loan due to concerns about the ability of DM&E to repay the loan. The letter was signed by Mark Kennedy and John Kline of the Minnesota Congressional delegation – but notably as reported in The Rochester Post-Bulletin, Congressman Jim Oberstar did not sign the letter. Oberstar sits on the Committee for Transportation and Infrastructure and which would have the ability to direct federal aid for the project. At the same time, candidate Tim Walz stated in that he “plans to work with Congressman Oberstar, the ranking member of the. Transportation Committee, to resolve any lingering DM&E issues.”

So, Oberstar seems to be a critical player. I did a google to see if I could find out Oberstar’s position.

Well, it turns out that Congressman Oberstar does seem to have a plan. H.R. 5965 was introduced into the House on July 28, 2006 and already has 54 cosponsors. {Hopefully, after Congress returns from its month-long “listening sessions”, it will be acted upon.}
The purpose of the bill is : “To strengthen national security and promote energy independence by reducing the Nation's reliance on foreign oil, improving vehicle technology and efficiency, increasing the distribution of alternative fuels, bolstering rail infrastructure, and expanding access to public transit.”
And has as major components :
Railroad Track Modernization Act of 2006 and Transit Rail Accommodation Improvement and Needs Act which would promote Transit Use & Develop a Rail Infrastructure Program that would create a stimulus package of infrastructure investment that upgrades the pipeline for biofuels – the freight rail system – in order to get an affordable and reliable supply of biofuels to market.

Oberstar’s bill seems to be a complete plan addressing the total energy independence issue as opposed to Gutknecht’s limited 10/10 plan.

But, the big difference between Gutknecht’s plan is to put all the monies essentially into one railroad --if the new proposed loan to DM&E is approved, it would hold 91 percent of the loan portfolio.

Compare that to Oberstar’s bill which would allow the dollars for other railroads. Oberstar has more knowledge and experience to know what is best for the country versus the RoveRobot Gutknecht who is rejected his pseudo-fiscal hawk persona at the displeasure of the citizens of Southern Minnesota.

Does it make sense to have one railroad that runs across Southern Minnesota getting all the monies, or to make sure that other railroads have upgraded track to serve the other areas of the State and serve other States ? How will ethanol producing facilities in Winnebago, Fairmont, Granite Falls, Little Falls, etc. link up with the DM&E tracks ?


The more and more I look into this DM&E fiasco, the bigger flaws are apparent.
Please read the Fortune Magazine article on DM&E in the March 20 edition ? It is very clear that this was a manipulation by politically connected people to affect the system for DM&E’s benefit. http://money.cnn.com/magazines/fortune/fortune_archive/...20/8371801/index.htm


And, for a political standpoint, the pundits are suggesting that the Democrats have a very good chance of being in the majority in the House. That could be a boon to Minnesota as Jim Oberstar would be in line to be Chairman of the Transportation Committee and Colin Peterson could be Chairman of the Agriculture Committee. So wouldn’t that say that farmers should be supporting Tim Walz ?

Sources :
Kevin Paap quote
http://www.examiner.com/a-242777~Contentious_railroad_project_heats_up_race_in_1st_District.html

New Ulm Journal FarmFest story
http://www.nujournal.com/include/articles.asp?articleID=3167

Rochester Post-Bulletin story of Gutknecht letter
http://www.protectrochester.com/downloads/Gutknecht%20asks%20review%20of%20DM&E%20Loan.pdf

Walz statement on DM&E loan
http://www.timwalz.org/vertical/Sites/%7BDD1DDF80-8E82-48D5-8648-607855AC529B%7D/uploads/%7BCBCD6A33-258F-4A7E-A267-FE4602707DCC%7D.PDF

Oberstar PROGRESS Act
http://thomas.loc.gov/cgi-bin/bdquery/z?d109:h.r.05965:

Support the Gutknecht Campaign Reform Act of 2007 … or How a Fiscal Fraud Spends Your Tax Dollars

I have asked before “Tell me in the past six terms of Gil Gutknecht’s tenure, one piece of legislation that he was critical to its passage?” To date, no one has found one … sure he’s had initiatives, but not any that have been enacted.

Well, good news folks ! It’s time for the Minnesota Legislature to enact the Gutknecht Campaign Reform Act of 2007. I know that this still would not count as legislation that Gil personally authored, but he is the inspiration.

The impetus of the act is that we have learned how the Fiscal Fraud has legally ( per the Minnesota Supreme Court ) “used” the system to save himself a few dollars at the expense of government wages and resources.

It is my understanding that in order to protect the right of the “little guy” to participate as a candidate for elective office, a candidate may collect signatures from registered voters and petition to appear on the ballot … as opposed to the “professional politician” who customarily pays a $300 fee. Sounds fair … let’s make sure that the common man can have a role in government.

But Gutknecht wants to appear as the common man, so what he does is collect the signatures and file the petition. OK, that’s legal … but if Gutknecht is truly serious that he as a fiscal hawk that watches for waste and abuse of the government’s assets, why is he wasting the resources of the Secretary of State ? Doesn’t Mary Kiiffmeyer’s staff have to review these documents, cull voter’s records, etc. to ensure that it is valid ? The alternative is paying $300 and you’re on the ballot. Sounds like a waste of government resources … if you’ve got the monies.
The funny thing is that according to the Elections Division Director letter to Gutknecht of July 14 “this office has finished reviewing your petition in lieu of the filing fee in place of paying $300 filing fee …. The filing requirement with this office has now been satisfied. Please find enclosed a copy of your affidavit of candidacy and your original check for $300.”
So, he had the money ( in fact according to Federal Campaign Filings, his campaign war chest is $ 826,391 ) but still wanted to waste the Secretary of State’s resources. He did not even offer to pay for the Secretary of State’s time and efforts … but I’m not surprised since the cheap-o has voted to support Congressional pay raises.

So here is my proposed law. If you are a candidate who has received a minimum of 15 % of the vote in the previous election, you must pay the $300 fee.
Pretty simple … if you’re just an average Joe who wants to offer himself as a candidate, the petition process is an option; but if you’ve ran in the past and the voters thought enough of you to vote for you, you simply pay the filing fee. The logic in the petition process is that it gives the candidate a chance to talk with the voters and find out if there is support for the candidacy. But if you’ve already on the ballot once, enough people have already know your name, so that should not be necessary.

Now, my problem … who will champion my proposal in the state legislature … with Republicans Tony Cornish and Julie Rosen as my elected legislators, I have a hunch that for partisan reasons they won’t embrace it. Let me know if you can recommend any competent independent thinkers who truly believe that government waste must be addressed … and not being abused for the advantage of our elected officials.

Oh, and one last thought. Gil may not like the idea that the Act would be named for him as a lasting remembrance for all he did for Southern Minnesota. Generally after a Congressman’s term is over, a facility is named from him … normally a Post Office … but I have a hunch that Gil is holding out for a DM&E train stop.

Sources :
Court Filing
http://www.mncourts.gov/documents/0/Public/Court_Information_Office/Petitoners.pdf
Campaign Funds
http://www.opensecrets.org/races/summary.asp?ID=MN01&Cycle=2006

Gil, How is DM&E going to help me & 2.3 million others in the region ?

I understand that the two biggest reasons for the DM&E loan are (1) coal needs to be moved from the Powder River Basin in Wyoming; and (2) lower costs for farmers in moving product.

But I do not understand how that will help us in Minnesota.
Isn't the largest coal fired plant – which is planning an expansion – in Milbank South Dakota with the power distributed through Otter Tail Power in Fergus Falls? That area is served by Burlington Northern. My electricity comes through BENCO which is part of Great River Energy who uses Big Stone. The Big Stone II expansion will provide transmission power from 230 kV to 345 kV and will meet the increasing energy needs of their 2.3 million customers in Minnesota and the Dakotas. The participating companies besides Great River are Otter Tail Power, Southern Minnesota Municipal Power, Heartland Consumers Power and more.
I have had it confirmed by a second source that DM&E will not be running track to Big Stone, so if there are any cost savings to be had in transporting coal from Wyoming, we will not be affected.

A Washington-based lobbyist informed me that there is no assurance that DM&E will be able to provide any lower rates than BN since DM&E could operate a captive line … and the best hopes for rate reductions are with the Surface Transportation Board. So why should farmers feel that there will be any rate reductions ?

My concern has always been the fiscal implications. Why are the taxpayers being used for a program that will largely benefit one company ? U.S. railroads are slated to invest a record $8 billion in capital expenditures this year. How will BN, Norfolk Southern, Union Pacific, etc respond when the government sets up a program that benefits one competitor – how quickly will they be coming to the Congressional trough for their own share ? A slippery slope that should be avoided. The major problem is how this was enacted. As an earmark in the TransPORKtation bill, this specific funding was not adequately debated. I believe that if this was voted on a stand-alone up-and-down vote, it would fail. Tax policy is written too often with special interests in minds … if there is need for an overall improvement to modernize railroads, why not a federal tax credit on investments that expand railroad capacity for all railroads ? Financially secure companies will invest and reap the return as a tax credit versus the taxpayers up-fronting a loan.

Mark (the Hypocrite) Kennedy has released his fourth campaign commercial.

From a political strategy standpoint, it’s pure genius … from a reality point, it’s misleading at the very least.

One aspect of political campaigning is to recognize that your opponent will point out your shortcomings. So, the best defense is a good offense – confront the weakness; massage the message so that the weakness seems to be strength; and move on before anyone catches on.

The jest of this commercial is that the Senate is full of lawyers but not one Certified Public Accountant (CPA).

Wow, think of it, which profession has the worst reputation … newspaper reporters excluded .. that’s right either attorney or accountant … and if your opponent is an attorney, your get bonus points in a lot of voters minds.

According to Kennedy’s bio, he is a former certified public accountant with Arthur Andersen – that’s right the now defunked accounting firm made famous after the collapse of oil giant Enron Corporation . . His Public Accounting work was short - he passed the CPA exam in 1979 and worked at a CPA firm for two years and eight months . In 1983, Kennedy graduated with a master's of business administration from the University of Michigan. From there he climbed the corporate ladder in retail companies. He served as chief financial officer at ShopKo and was a senior vice president at Department 56 before his congressional career began.
Now, the DFL has already leaped on the “exaggeration” of his status as a CPA. As the StarTribune reported : “Kennedy hasn't practiced as a CPA for decades and is on inactive status with the state Board of Accountancy. In his latest application for an inactive certificate from the board, filed in December, Kennedy promised not to "lead a person to believe that I hold an active certificate in Minnesota" and to "place the word 'inactive' adjacent to my CPA title."
http://www.startribune.com/587/story/623374.html

But the DFL has missed two other points of weakness.

#1. The need for a CPA in the Senate. Well, I’m not an attorney, but as I recall from grade school civics, the US Constitution in Section 7 states “All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.”
So, if the attributes of a CPA is desirable and Revenue (Tax) legislation must originate in the House, wouldn’t his education and work experience as a public accountant with Arthur Anderson be best used as a Congressman?

#2. Kennedy’s utilization of his education and work experience as a Congressman. So, according to the ad, if Kennedy was a Senator he could apply his professional skills to the federal budget. So, the obvious question, since Kennedy has been was elected as a Congressman in 2000, “Are the Budgets balanced, and has the National Debt been reduced ?” Are you laughing … in one word … the Budget and Deficit has EXPLODED under CPA Kennedy’s management. In 2000, when Kennedy was first elected to Congress, the Outstanding Public Debt was less than $6 trillion, but by 2002, it passed $6 trillion … and on January 15th 2004, it passed $7 trillion … and on October 18th 2005, the Outstanding Public Debt rose to $8,003,897,406,911.24 -- the first time it had risen above $8 trillion.
The politicians will attempt to defend the rise based on the “Internet-bubble” bursting in 2001 causing a recession and then the 9/11 terrorists attacks. But some politicians will blame it on the Bush tax cuts. Those affect the revenue side, so for discussion sake, let’s ignore that; as Congress also controls the spending side.
There are two notable pieces of legislation that Kennedy was instrumental in passing; meaning that his arm was the last one twisted to gain passage.
The Medicare Part D Program ( although some may think the D stands for debacle but it is actually the new Prescription Drug benefit program that the White House now estimates will cost $1.2 trillion ).
And the 2005 TransPORKtation bill which is chock-full of pork barrel spending. Most interesting to Southern Minnesota, since that is the authorization for the DM&E rail expansion. Fiscal Conservative Congressman Jeff Flake went to the House Floor in last month to complain again about the essessive spending in that bill.
Mr. Speaker, last year's highway authorization bill, better known as SAFETEA-LU, which brought us the bridge to nowhere, seems to be a gift that keeps on giving. It has now cleared the path for a program that may set a standard for fiscal mismanagement and favoritism by the Federal Government. Thanks to changes made to the Railroad Rehabilitation and Improvement Financing, or RRIF, program in SAFETEA-LU, the administration is considering awarding one of the largest loans to a private company in the history of the United States. This would be a $2.5 billion loan to the Dakota, Minnesota and Eastern Railroads, or DM&E, a loan larger than the Chrysler bail-out. SAFETEA-LU expanded the loan authority of the RRIF program from $3.5 billion to $35 billion and removed any prohibition on the size of any single loan, paving the way for the DM&E loan application. If drastically expanding the program's loan authority opened the door for DM&E, a handful of other changes to the program all but drive the loan application home. Mr. Speaker, the RRIF program is on the verge of being used to provide a competitive advantage. It is inappropriate for the taxpayers to finance it.

I agree that a CPA would be advantegous in Congress ( I believe that there are at least two now ) … but based on Kennedy’s performance, he hasn’t earned that job. In fact, I shudder at 6 years of Kennedy CPA management. If you are concerned about the sancitity of Social Security, be mindful that entitlement reform will be the BIG issue in the last two years of the Bush presidency. Since Congressman/CPA Kennedy has endorsed borrowing from Social Security to pay for current budget needs, what accounting tricks would a Senator/CPA Kennedy use ? Scary !

Congress wants to CUT Veterans Funding AND RUN from Responsiblity

Father Tim is not the only veteran that Congress is pulling the funding plug.

When a Marine in Fallujah barely escapes an RPG attack, or an IED explodes near a soldier's Humvee, the blast can cause the troop's brain to slam against in the inside of his skull. The result is Traumatic Brain Injury, or TBI, which can cause dizziness, problems with vision, hearing, or speech, memory loss, and even severe brain damage. At least 100,000 troops serving in Iraq or Afghanistan have been affected by TBI. Military experts say that one in ten new veterans, or more than one hundred thousand people, suffer from TBI.

But the 2007 Defense Appropriations bill gives TBI research and treatment only $7 million dollars -- half of what it received last year. And ridiculously, this is barely above the budget authorization of $6.5 million in fiscal 2001 --- when we were not at war.

Initially brain injuries may go undiagnosed when there are other physical combat injuries present only to be discovered later. Failure by Congress to fund these programs may result in the State of Minnesota having to provide care through vocational rehabilitation, employment services, education, home health care, mental health, substance abuse, and long-term care services. When families are no longer able to provide the personal care for these individuals, the families turn to the State as the only source of help.

From my research, Senator Jack Reed (D-RI) and Barack Obama (D-IL) are working to restore these cuts, but your support is needed. Below listed is a link to a sample letter that could be sent to our Senators as the House has already approved this budget cut.
Also, there are two articles about the subject.

America's wounded warriors deserve better.

http://www.iava.org/index.php?option=content&task=view&id=1874&Itemid=105

http://www.usatoday.com/news/washington/2006-08-08-brain-center_x.htm?csp=34

http://www.projo.com/news/bobkerr/projo_20060811_frico11.1fc69b7.html

And if you don’t know about Father Tim, see my earlier post.

Gutknecht calls the kettle black

Duane Winn of the Pipestone Times published the following from an interview with Congressman Gutknecht :
Gutknecht said he still supports President Bush's basic strategy of withdrawing Americans as Iraqi forces take over the security burden. However, he admitted that he's felt uneasy about American policy toward Iraq for the last two or three years. He stated that the Bush administration has put a spin on the amount of progress that has been made in Iraq, mostly on the security front.
As a fiscal conservative, Gutknecht said, he also bemoans the expenditure of $322 billion to finance the war.
He believes the United States has followed policies that are based on "American hubris" that's been displayed in previous wars, namely, Vietnam and Korea.
"I call it the ‘Westmoreland Effect.' If you put enough troops on the ground, you will win the war," said Gutknecht.
There have been tremendous strides made in Iraq, said Gutknecht, but Baghdad he observed during his trip is "a more dangerous place than I had ever imagined."
Gutknecht said the United States should be heedful of the advice offered by T.E. Lawrence, A.K.A. Lawrence of Arabia, who said, "Do not try to do too much with your own hands. It is their war, and you are to help them win it, not to win it for them."
http://www.pipestonestar.com/Stories/Story.cfm?SID=14031
Emphasis added.

For those of you who have ready my previous commentary, I have constantly complained of Gutknecht’s unrealistic “Happy Talk” about Iraq in his weekly email. Although I label it as “Happy Talk” and Gil calls it “spin”, Gutknecht is calling the kettle black since he is acting as the mouthpiece to promote questionable progress … I guess his experience as an auctioneer should give the voters fair warning that he is only peddling the policy not claiming it as his own.

Addressing his fiscal concerns of the liberation of Iraq, he is extremely shortsighted. Bush has been clear that the War on Terror will not be won quickly … based on the bases that have been built in Iraq, Congress needs to plan for a long term fiscal investment. America does not control the timetable … al Queda planned the 9/11 attacks for years before implementing … and Hezbollah took over 25 years before significantly engaging Israel. Gutknecht clearly does not grasp that the actions that we take today are shaping the generations to come … we will not know the results for decades. Considering the rising costs for the war, why did it take so long for Gutknecht to visit the region? It is fair to fault Gutknecht and the Republican leadership for placing the bill for these military actions on our retirement years and children’s and grandchildren’s tax obligations. If Gutknecht was truly a fiscal conservative, he would not be voting TaxCut & Spend.

Regarding his “American Hubris” comment, I question whether Gutknecht has ever been a supporter of America being involved in foreign affairs. On April 28, 1999 (H. Con. Res. 82, Roll Call no. 101), Gutknecht voted to require the immediate withdrawal of U.S. forces from the Balkan conflict. On May 04, 1999, Gutknecht “we are prepared to fight a war in the desert, and now we are apparently going to have to fight a war in Kosovo. The problem is we are spreading ourselves too thin.” Gutknecht clearly has his vision in isolating America … that can only hurt America economically and allow the extremists to influence other countries.

If he has “felt uneasy about American policy toward Iraq for the last two or three years, why hasn’t he expressed this to the voters and party faithful ? For someone who initially campaigned on a pledge of term limits, it is easy to understand Mark Kennedy’s complaint about his fellow Republican :
“Many of our elected Republican’s have become too complacent, and the fervor of the “Republican Revolution” of 1994 needs to be rekindled. The reason for this complacency is that we have elected from our party, the status-quo candidates, who have been serving in government their entire careers.”

Mark Kennedy Recycling the Gas Issue

Have you seen the third installment of the “Elect Mark Kennedy” commercials?

The first commercial was vintage Kennedy … get to know the family – all five generations … in fact, I think he has the same flannel shirts that were in the 2000 commercial … still clean and pressed.

The second commercial was Kennedy the Washington Outsider {in other words, don’t blame me for the spending in Washington} … a Republican when right but willing to cross party lines … {Democrats want to cosponsor Kennedy’s legislative ideas}.

Now, the current commercial – “Gas Pump”.
Essentially, Kennedy is recycling legislation that has languished in Congress. For example, his HR 4623 which was introduced on December 17, 2005 and referred to the Committee on Ways and Means that same day. It still sits there with no action … and FYI – Mark the Hypocrite Kennedy sits on the Ways and Means Committee. He also references HR 5302 which was introduced on May 4,2006 and assigned to committee on May 11. That bill has five cosponsors – all Republicans. { Remember on May 2nd, ExxonMobil announced its quarterly earnings and politicians leapt to denounce the oil industry. FYI – Kennedy has received over $50,000 from the Oil/Gas Industries. }
Kennedy has suggested suspending the gas tax with the idea that it will produce an immediate 18.4 cent per gallon savings for motorists {Sounds like election-year pandering that all drivers would financially appreciate, but with the deficit, why are we sacrificing collecting tax dollars?} And the always Hypocrite Kennedy said on the House floor on May 2,2006 “While much of this is the result of increasing demand generated by our growing economy and increased instability in Iran and other oil-producing countries, Congress has a duty to take action. Some in Congress like to play politics on this issue. The American people don't want cheap political games and stunts. They want and deserve solutions.”

Addressing America’s dependence on foreign oil is not new … we have known about this during all of Kennedy’s Congressional terms … but recycling legislation that the Republican controlled Congress has not embraced does not excite this voter … in fact, it shows no vision of the future … especially for someone that is looking at a six year term.

Likewise, Gil Gutknecht's Congressional inactive, but constantly being touted in his campaign speeches, 10/10 plan is ten years too late.


http://www.markkennedy06.com/News/DocumentSingle.aspx?DocumentID=17422
http://www.thomas.gov/cgi-bin/query/D?r109:2:./temp/~r1092Lj06Z::