The lion’s share of Minnesota’s new tax revenue was sunk into human capital. While the state’s Constitution required that half of the new revenue balance the budget in 2013, Mr. Dayton invested 71 percent of the remaining funds in K-12 schools and higher education as well as a pair of firsts: all-day kindergarten and wider access to early childhood education. Minnesota was one of the few states that raised education spending under the cloud of the Great Recession.

By contrast, Mr. Walker’s strategy limited Wisconsin’s ability to invest in infrastructure that would have catalyzed private-sector expansion, and he cut state funding of K-12 schools by more than 15 percent. Per student, this was the seventh sharpest decline in the country.

Health care presents another difference. When Mr. Walker refused to establish a state health insurance exchange or to expand Medicaid, even though the federal government covered all costs for three years and most costs after that, ideology trumped pragmatism. The uninsured and the ill bear the burden. Many of the 10 percent of uninsured Wisconsinites were denied new Medicaid benefits and were shunted off to the federal exchange’s stumbling website.

Mr. Dayton is on course to improve Minnesota’s already low uninsured rate. He expanded Medicaid to cover an additional 35,000 people and accepted Washington’s offer to pick up the cost — as half the states, including a growing number with Republican governors, have. Mr. Dayton also created a state insurance exchange, which enrolled more than 90 percent of its first month’s target. Meanwhile, Minnesota’s tradition of innovative medical care and nonprofit insurers produced premiums in its insurance exchange that are, on average, the lowest in the country, well below premiums in Wisconsin.

Mr. Dayton’s embrace of progressive fiscal policy is matched by a fierce crackdown on lenient payments to insiders. Cuts in payments to managed care organizations serving Medicaid saved $175 million and produced lower rates in 2013 than in 2010, despite higher costs over all.

Of course, liberal aspirations contend with stubborn realities. Minnesota is a health reform pioneer, but it is dogged by entrenched problems in rural areas, where medical costs and premiums remain relatively high and the capacity of medical care providers may be overstretched by new demand. As for fiscal policy, Mr. Dayton would have applied sales taxes more broadly, while lowering their rates, but faced intense protests from a broad section of businesses and Democratic legislators who blocked him.

Even after tempering their initial plans, Democrats face a backlash. According to a recent Minnesota Chamber of Commerce survey, a quarter of Minnesota companies — a 10-year high — describe the state’s business climate as worse than elsewhere. Mr. Dayton and his colleagues got the message and are likely to roll back new sales taxes on farm equipment and warehousing facilities that had threatened to leave.

Evidence and common sense should matter more in our overheated political debates. The lesson from the upper Midwest is that rigid anti-tax dogma fails to deliver a convincing optimistic vision that widens economic opportunity and security. The excesses of liberalism may lurk, but Minnesota is building a modern progressivism that plows a hopeful path.