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    Things look messy but help might finally be on the way


    By Nick, Section News
    Posted on Thu Oct 02, 2008 at 06:30:03 AM EST

    Remember that old adage that when the nation gets a sniffle Michigan gets a cold? The United States a cold the Great Lakes State the flu?  During the 2006 campaign I lost count of how many times I heard the warning that without a change in leadership, without a swift kick in Lansing's pants we stood on the brink of missing an entire national economic recovery.  That lingering in a prolonged one-state recession was pretty rotten but wasn't the tip of the iceberg should things get worse nationally.

    Exhibit A.  The Associated Press reported a few hours ago on the latest auto sales figures, probably the number one market number affecting Michigan's jobs outlook. And the results:

    Beleaguered Ford reported a 34 percent decline, while Chrysler said its sales fell 33 percent and Toyota posted a 32 percent drop.

    It was Ford's worst sales month this year, and the results across the industry are a strong indication that the financial turmoil that has swelled since mid-September is pushing the auto industry deeper into its trough...

    George Pipas, Ford's top sales analyst, said nearly all automakers saw "extremely weak" sales in the waning days of the month as the Wall Street crisis grew and Congress debated the government's $700 billion bailout of the financial industry.

    "It was tantamount, really, to a natural disaster," he said.

    All of this dropping the same evening the United State Senate counted Michigan Senator Carl Levin among those supporting a $700 billion spending spree using taxpayer cash to buy up bad debt.

    This ain't pretty folks, and it ain't looking any brighter for us locally without serious changes in Lansing.  Which brings us to a smidge of good news on an otherwise bleak financial morning.  

    Read on...

    Senate Republicans stand this morning on the verge of taking a serious bite out of both the reviled Michigan Business Tax and Jennifer Granholm's Hollywood Relocation Program.  The Detroit News reports:

    The Senate is expected to pass as soon as today a bill to accelerate the phase-out of a 22-percent surcharge to three years, rather than 10. The surcharge, which treasury officials say will take in $722 million this year, was enacted as an add-on to the new Michigan Business Tax last year, to help wipe out the state budget deficit.

    Republican leaders also want to cap the state's new film tax credit and make the overall business tax more fair and balanced by removing from the calculation of gross receipts sales tax collections and fees assessed by other states. To include these items in the tax base amounts to double taxation, critics charge...

    Senate Finance Committee Chair Nancy Cassis, R-Novi, contends the new tax is bringing in more revenue than advertised and is hurting Michigan's economy at the worst possible time.

    "What we have with this new tax is a plan to sink Michigan to the bottom," Cassis said. "We're talking about systemic reforms that put Michigan businesses back in position to create jobs."

    Sure, it would have been nice to see this sort of thing a few months ago, or better still if we were never in this position in the first place.  But alas, we are, and unless you've got a way-back machine moth-balled in your garage there's no sense in rehashing the failures of the past.  We live in the here and the now.  It's October 2, 2008 and we have an onerous Lansing tax policy that continues to drive jobs out of the state.  

    A wise man once told me that in the face of adversity, especially adversity of one's own making, and who made this mess if not Lansing, the question isn't "what mistakes were made in the past" but "what is the next right thing to do?"  You course-correct.  You identify mistakes and you fix them.

    The Michigan legislature approved a $1.5 billion tax hike last fall.  Fix it.

    Michigan voters gave Democrats a sweeping majority in the state House last election.  Fix it.  

    Andy Dillon is the speaker of the House and the driving force between just about every piece of rotten policy coming out of the state capitol.  Fix it.  Well, actually, there are still a few folks working on that one.  The Ivory Tower chimes in this morning with a guest commentary on the strength of the Dillon recall in the broader context of... we'll call it legislative motivation.

    Recalls are powerful, if infrequently, used weapons. The value is not just in removing an elected official; it is also in the threat. The Dillon recall, which would seem to have very little effect due to its timing, serves this role. Recall proponents are trying to put the other legislators on notice -- they may be seeing a recall in their future.

    Translation: Lansing, you made a mess.  Fix it.  Or else.

    < If Stupak endorses Obama, why did he vote No? | Thursday in the Sphere, October 2 >
    Display: Sort:
    I want to (none / 0) (#1)
    by maidintheus on Thu Oct 02, 2008 at 08:57:52 AM EST
    read this over and over.

    Good stuff, Nick.

    This article (none / 0) (#2)
    by maidintheus on Thu Oct 02, 2008 at 09:21:03 AM EST
    was even better when I read it again.

    • Thanks by Nick, 10/02/2008 09:30:18 AM EST (none / 0)
    Thanks Nick (none / 0) (#4)
    by apackof2 on Thu Oct 02, 2008 at 10:17:04 AM EST
    I just e-mailed my (Democrat) Senator to pass both of these and I called Senate Finance Committee Chair Nancy Cassis to thank her

    My e-mail is below ( I BCC Cassis on this e-mail to Whitmer :-)

    Sen. Whitmer,

    I am writing in support of a Yes vote for Senate Bill 1242 phases out the 21.99 percent MBT surcharge over three years beginning Jan. 1, 2009. AND SB 1535 places a $50 million yearly cap on film credits available under the MBT, beginning in calendar year 2008

    *According to a  survey of U.S. corporate executives, Michigan scored 3rd in the least favorable business climate of U.S. states with taxes, high costs, and "anti-business climate."

    *The source for survey of U.S. corporate executives quote is here http://rtoonline.com/Content/Article/jul08/BusinessClimateStates.asp

    The survey of corporate executives, conducted by Development Counsellors International (DCI) every three years, has tracked trends in economic development since its inception in 1996.  Taxes, high costs and "anti-business climate/regulation" spurred most of the negative opinions

    The MBT is the main reason that Michigan is viewed unfavorable by businesses

    Why relocate and why not even move to another state that has a favorable business climate?

    Michigan is losing jobs and young professional. Passing these 2 bills is necessary

    Sincerely,
    My name
    address

    The game is (none / 0) (#5)
    by LookingforReagan on Thu Oct 02, 2008 at 11:35:56 AM EST
    If I were Mike Bishop ( and I am glad I am not)I would set forth an agenda of the following. Keep trotting out one piece of pro-growth legislation after another. Let the Dems vote it down in the house to unmask the truth behind their Obama/Granholm/Dillon economic experiment. I would send bills to the floor that offer tax relief for Michigan citizens and businesses both large and small, Right to Work legislation to give workers a real choice, set limits on the size of the State Government and force reductions. I would then offer bills that would privatise all the minimum security prisons and up to half of the medium security prisons in the state. Another area would be health care reform for teachers and state employees that allow the state to shop around to get the best deal instead of having to deal with one enity because it happens to have the same union representation as the state workers. Deregulation to allow for streamling the permitting process to get new businesses up and running sooner and to aid existing businesses in updating and expanding capacity.
    Next I would call for a Constitional Convention to put into place ammendments that would give the people more control over the purse strings and prevent the Liberal Political class from constant infringements on the rule of law in the state.
    I am sure I can think of many many more. But the idea is clear and if the Republicans really want to win this thing next month I suggest they get with the program and let folks here at home see exactly what the Dems are willing or unwilling to do to help those that put them in office. I am willing to bet I am right. Now lets see if the Elephant handlers have the guts to carry it out.

    ^^^Excellent Points^^^ (none / 0) (#6)
    by KG One on Thu Oct 02, 2008 at 11:59:53 AM EST
    I would also make one more suggestion: I would also include a rollback of last year's income tax hike as well.

    I would point out the fact that Michigan economy's hurting, and that the people who are in the best position to fix it are the residents (those still remaining) themselves...not Lansing. Allowing them to keep more of their own money is a step in the right direction (plus, I'd love to see the democrats argue against that).

    I'd hold off on RTW for at least another two more years.

    By that time, the ability of the unions in Michigan will have decreased enough to finally ram it through.

    Nick, great article (none / 0) (#7)
    by tenex22 on Thu Oct 02, 2008 at 01:10:24 PM EST
    Just one note, it is now 800+ billion we looking at in the "bail out" after all of the pork was added to make it more "attractive" for the house Republicans. Interesting how free our Senators are with our money, especially when the majority of the people are against this bail out.

    Reading it again! (none / 0) (#8)
    by maidintheus on Fri Oct 03, 2008 at 09:15:51 AM EST
    Good article and comments!

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