New Michigan Governor Rick Snyder announced his new state budget last week. Thus, the Detroit Free Press Sunday edition has a couple pages of the Viewpoint section devoted to it. In the middle of it all is an interview with Snyder.
Warning, links to the Freep may be free for only a couple weeks.
There are a few good things mentioned throughout the commentary. Snyder himself said it well. Consider if the state fiscal policy were a blank slate. What would be the ideal mix of what kind of taxes along with what kind of expenditures? Considering the state budgetary mess and the dysfunctional legislative process, this is a good way to think about it. Previous legislatures gave out tax credits to attract business, but those don't show up as expenses in that year. The state still has several millions in outstanding credits to play havoc with budgeting. Better to have appropriations that are paid this year. If you want some of that money, stand in line and convince us.
Ah, but Snyder is GOP. So up next is some criticism of the budget. Stephen Henderson, editor of the editorial page for the Freep, takes on Snyder's claim that the budget will call for equal sacrifice. Snyder proposes getting rid of the Earned Income Tax Credit, which helps poor families. That leaves only the state income tax, which by the constitution must be the same for all taxpayers. But any changes in the income tax (remember, he is GOP) benefit the rich more than the poor. For the poor, the loss of the EITC means what kind and how much food gets put on the table. That affects the viability of small businesses. For the rich, a lower tax rate means a difference in discretionary spending. "It is a redistribution that is decried as socialist when it's applied in the other direction."
Jill Alper, former campaign strategist for former Gov. Jennifer Granholm, takes on Snyder's tax cuts. Granholm cut taxes 99 times hoping for job growth. Michigan boosted its image in business climate. But we were still last in job growth.
In the last couple years there was a great deal of investment to save the auto industry and create a battery industry (among many other things). Unemployment fell six times faster than the national rate. Tax cuts don't create jobs. Investments do.
Mitch Albom is annoyed that Snyder wants to severely cut the tax credits offered to the film industry. That has been a bright spot in our economy over the last couple years -- actual jobs. With a looming cut, film production will stop coming. Nothing like killing off a promising industry that prompts the younger generations to stick around.
The budget goes next to the -- GOP controlled -- Senate and, um, the -- GOP controlled -- House.