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September 8, 2017 MichiganVotes weekly roll call report

Senate Bill 409, Facilitate private home Great Lakes harbor leases: Passed 26 to 12 in the Senate

To authorize 50 year "bottomland" leases to owners of single-family homes on Great Lakes shorelines who want to create a private, non-commercial, recreational harbor formed by a breakwater. Owners would have to pay 1 percent of their home's state equalized property value in an up-front lump sum payment every 25 years. The money would go into a segregated account that pays for parts of the Department of Environmental Quality's operations.

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Who Voted "Yes" and Who Voted "No"


Senate Bill 404, Give veterans free state identification cards: Passed 38 to 0 in the Senate

To exempt veterans from having to pay the usual fee to get a state identification card.

Who Voted "Yes" and Who Voted "No"


House Bill 4892, Correct some cities' candidate filing deadline errors: Passed 92 to 13 in the House

To provide an exemption to state-imposed city election candidacy filing deadlines for several cities that gave prospective candidates bad information on this, causing some to miss being on the ballot this November. The bill would require these cities to put these candidates on the ballot. It would also require more training and oversight for these cities' election officials, and impose $2,500 fines.

Who Voted "Yes" and Who Voted "No"


SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit www.MichiganVotes.org.


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Flatten the Tax Code

Select tax breaks aren’t the answer to our tax problems

In 2014, Michigan Congressman Dave Camp rolled out a major tax reform proposal. It hit all of the main pillars that economists across the political spectrum thought would spur economic growth – it lowered rates, expanded the base, was revenue neutral and eliminated many company and industry favors.

But it died. Getting rid of loopholes is a great idea, but when it’s proposed, the beneficiaries of select tax treatment come out in hordes to defend their privilege. Farmers, real estate agents, energy groups, municipal governments – all came out to defend the tax breaks.

Republicans have been talking tax reform for years and now that the party controls the White House and both chambers of Congress, leaders are putting together another plan. Unfortunately, many of the same groups (and some more) are out in force against these plans. Some corporations are treated differently by the current code and those who have an advantage don’t want to lose it.

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Michigan is going through a similar fight. After several years of lowering business taxes by flattening the tax code, a bipartisan majority of the Legislature is pushing back. Previously swearing off special tax credits (after racking up billions of dollars owed) and eliminating a number of other preferences in the tax code, the Legislature has passed two packages this year favoring select businesses. Proposals to expand property tax write-offs, give a special privilege to pension income and favor people who regularly trade in vehicles to purchase new ones are all gaining ground.

A better tax system has a broad base and low rates. It’s not a good idea for legislators to favor some companies, some industries and some people over others.


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Public Service Commission actions threaten electric choice in Michigan

MPSC intends to restrict access to out-of-state markets

Michigan’s Public Service Commission and the monopoly utilities it regulates appear committed to imposing an in-state generation mandate on Michigan’s electricity choice providers. But the Commission’s own lawyers say the plan would harm the reliability of the electric system, push electricity costs up and even contradict federal policy.

Last December, lawmakers’ plans to pass significant new electricity legislation – Public Acts 341 and 342 – were delayed when some legislators opposed including a “local clearing requirement” in the law. The requirement, which would essentially mandate that electricity sold in Michigan be produced in Michigan, would hit alternative energy suppliers (AES) the hardest. Those suppliers, which compete with the two big utility companies — Consumers Energy and DTE — are an essential part of Michigan’s electricity choice market.

A part of the new law (Section 6w) requires electricity suppliers to show the Michigan Public Service Commission (MPSC) that they can meet the energy needs of their customers. The Commission, in turn, says that any electricity sold in Michigan needs to be generated in Michigan. But currently federal policy – set by the Midcontinent Independent System Operator (MISO) — allows electricity suppliers to buy the electricity they sell to customers from the open market, which could mean turning to out-of-state sources. That policy is consistent with the Constitution’s interstate commerce clause, which allows for goods and services to cross state lines freely.

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No problems have been reported with alternative electric suppliers purchasing electricity from outside Michigan. But the state’s monopoly utilities, DTE and Consumers Energy, argue that an in-state requirement is essential to maintaining a stable electricity system.

In an emailed comment, DTE’s media relations office said that “With Michigan’s unique geography and the physical constraints of electricity, nearly 95 percent of Michigan’s electric supply must be generated within Lower Michigan. … Holding all energy suppliers responsible for their own customers’ needs is fundamental to reliability and the 2016 energy law.”

Electricity choice suppliers argue that no mandate is required; they must meet their customer’s needs if they want to stay in business. Further, they say, DTE and Consumers Energy own and operate the vast majority of Michigan’s generation facilities. So the in-state requirement would force them to build redundant and expensive facilities to generate electricity, or to rely on their competitors for their electricity supply.

It is just this sort of tension that stopped the voting on electricity legislation in December. As long as the in-state requirement remained in the draft legislation, House leaders couldn’t cobble together enough votes to pass the bills. Many Republican House members, who supported electricity choice in Michigan, recognized that leaving an in-state generation requirement in the law would effectively kill off Michigan’s choice market. Therefore, they opposed leaving it in the final bill.

Only after the language requiring in-state generation was removed in the final hours of the final evening of debate did enough Republicans agree to vote “yes.” By waiting until the requirement was removed from the bills, Michigan’s elected representatives sent a clear statement that using the legislative process to kill off electricity choice was a nonstarter.

Despite that clear legislative intent, the MPSC stated in a June 15, 2017, order that it planned to resurrect the same in-state generation requirement that legislators had openly rejected just six months earlier. Not surprisingly, the MPSC’s plans are injecting back into the discussion all the concerns first raised by advocates of choice.

An August 21 letter by House Energy Policy Committee chair, Gary Glenn, blistered Sally Talberg, chair of the MPSC, for “imposing such a damaging policy on (Michigan’s) economy.” In his comments, Glenn referred to a May 26, 2017, letter, written by three assistant attorneys general who were assigned to provide guidance to the Commission. That letter clearly “advises against introducing a new [in-state] requirement in 2018.”

The attorneys explained that imposing the in-state mandate on electricity choice markets “would not improve reliability in Michigan and could potentially be a detriment to customers.” They argued the mandate would “make it extremely difficult, if not impossible,” for alternative electricity suppliers to find enough electricity for their customers.

The attorneys also said that the in-state requirement would “actually compromise reliability for some specific Michigan customers.” They warned it would work against the rules established by MISO, the regional operator for the Midwest and overseer of Michigan’s electric grid. In contrast, they stated, “if the status quo is kept for 2018,” alternative electricity suppliers “could continue to serve the capacity requirements of their customers” by getting the electricity they need from outside the state.

In another statement, Glenn stated his clear intent to step up his resistance to the Public Service Commission:

I will recommend that the Legislature itself go to court, if necessary, to reassert that energy policy in Michigan will be set by the Legislature, who are elected by and accountable to the people, and not by an appointed bureaucracy that seems intent on advancing the financial self-interests of two corporate monopolies at the expense of Michigan ratepayers and our economy.

When Michigan citizens elect their representatives, they expect them to have a say in the policies that affect their lives. When those representatives make a clear statement of intent on a key policy issue, it seems eminently reasonable to expect Michigan’s government employees to pay attention. When those government employees seek further legal advice on how to respond, and that advice agrees with the clearly stated intention of the Legislature, it seems odd that they would ignore it. If the Commission is going to ignore the Legislature and its own lawyers, and push forward with its plan for an in-state mandate, one has to ask why they bothered with the regulatory review process in the first place.


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Giving More Taxpayer Dollars to Universities Won’t Make Michigan More Educated

No link between state spending and educational attainment

Michigan Tech President Glenn Mroz. Image via Michigan Tech University.

In The Detroit News, Michigan Tech President Glenn Mroz argues for more taxpayer spending on state universities. Students that get degrees, he explains, earn more than those without them. But he never says that giving state universities more taxpayers dollars will result in more students earning degrees. It won’t.

State universities charge tuition to their students, but the institutions also receive direct taxpayer dollars. Some states spend spend more taxpayer dollars on their universities than Michigan does. And there are states that have a more credentialed population than Michigan. There isn’t a connection between the two.

This can be seen on a chart. This looks at a state’s spending on universities and the percentage of its adult population that holds a college degree.

Wyoming and Alaska are the two states that spend a lot on higher education and have middling levels of educational attainment.

Michigan lawmakers are already taking $1.6 billion from taxpayers to give to state universities. They ask little in return for it. Residents should be asking lawmakers to dial back that spending if it has been sold as a promise to get more graduates in Michigan.


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Post Labor Day Weekend Good Time for Tourism Talk

Lots to discuss with unofficial end of summer season

There have been some recent developments and debates on the tourism front. They involve empty criticism of the Mackinac Center’s tourism study; an Auditor General investigation into a Pure Michigan consultant’s reports and the announcement that the Michigan Economic Development Corporation will again bid out the right to calculate a return on investment for the Pure Michigan program. They are worth sharing with the public.

Last November, the Mackinac Center released a study of state tourism promotion efforts. It found for every $1 million increase in state spending on tourism promotion, there is a bump in economic activity of just $20,000 in the average state’s accommodations industry. Michigan is average. Other sectors of the tourism economy actually fared worse. Our study has been met with some criticism for which we have offered rejoinders.

The most technical criticism leveled at our paper was posted without fanfare in late March and later republished on June 26 with additional commentary. It zeroed in on our statistical model. The short critique was posted on the for-profit Oxford Economics website. The tiresome talking points presented in the memo suggested the reviewer(s) had not even read our actual paper or related work. The Mackinac Center’s full rejoinder, “A Response to Oxford Economics," was written by my co-author Michael Hicks.

Oxford Economics, incidentally, has an economic dog in the fight. A company it owns, Tourism Economics, has been one of Michigan’s no-bid tourism contractors. In 2015, the president of Tourism Economics wrote an email to the MEDC about a Mackinac Center study he knew would soon be released. In the email, Adam Sacks offered to write a critique. Sacks claimed it wasn’t possible to estimate an impact from ongoing advertising with our techniques, saying econometrics is a “blunt tool” for such a thing.

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If that were true, however, top academic journals would not publish papers that employ econometrics. We cited several studies in our own report that use econometric measuring techniques, and one was even of United States-specific, taxpayer-funded tourism promotion programs. That study, titled “Are State Expenditures to Promote Tourism Effective?” was published in the Journal of Travel Research, once ranked the third-most influential journal in the field by one accounting.

Sacks was not the first person to criticize our work. The first was brief and from the MEDC’s secretive consultant. He claimed in a newspaper interview that the Center’s study did not take into account such things as the economy or weather. These charges were in error and we said as much in our written rejoinder, “Tourism Promotion Study Criticism Absurd, Ironic.”

The second criticism came from a former tourism marketing boss in Florida. At the time, Visit Florida, that state’s equivalent of Pure Michigan, was under fire and under threat of being defunded. The Mackinac Center’s report was cited publicly in the Sunshine State during this debate. We defended our research in a piece titled “Studies of Government-funded Tourism Promotion Withstand Criticism.”

The Michigan Economic Development Corporation, which oversees the Pure Michigan program, has in the past hired a contractor on a no-bid basis to estimate the program’s alleged return on investment. That consultant’s conclusions are wildly different from the Mackinac Center’s. His report claims a credulity-straining $8.00-plus in tax revenue returned for every dollar spent. Unfortunately, he refuses to precisely explain how the ROI is derived. He and the MEDC are basically saying, “You’ll just have to take our word for it.” We have never done so and are skeptical for a number of reasons.

Several lawmakers may be as well, as two have asked the Auditor General of Michigan to review the current consultant’s reports and the office has agreed. This new investigation made headlines in July. Around the same time, other news reports indicated that the MEDC was going to seek competitive bids for contractors to estimate the return-on-investment estimates, placing its current, secretive consultant in the position of needing to compete for the right to provide this service.

The Mackinac Center’s study on tourism promotion remains a defensible, scholarly work. Its methodology is 100 percent transparent and its data set is comprised of publicly available information. The state’s secretive consultant can’t make the same claim and neither can the MEDC or other apologists for subsidized promotional activities for the tourism industry.


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A “Not Welcome” Sign for Special-Needs Students

Nonresidents denied local special education dollars in 21 ISDs

A recent Bridge Magazine headline proclaimed: “Michigan failing its special needs children, parents and studies say.” Yet the reporting remarkably omitted a key player from the conversation: intermediate school districts.

The article says that, on average, Michigan students with disabilities trail their peers in other states. Test scores are lower, dropout rates are higher, and many more special-needs students are diverted from mainstream classrooms into segregated environments.

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Bridge correctly observes that “where a child lives in Michigan can dictate what services they receive.” The state’s 56 ISDs play a prominent role in this by producing administrative plans to fund and deliver special education services in their respective regions. In seeking to address the diverse and complex needs of local schools’ disabled populations, these agencies greatly shape students’ experiences with special education.

Michigan’s ISDs can do so because they have a lot of money to spend, receiving state and federal money for special education. Together, ISDs also take in nearly a billion dollars from local special education millages.

Every ISD, which taxes local business and homeowners, has a different tax base and its own tax rates. This creates a wide gap in how much local funding an ISD has. In 2016, local special education millages collected for each special-needs student anywhere from about $1,200 to $9,700. Statewide, ISDs collect an average of $4,650 in special education tax revenue for each student who has a federally required Individualized Education Plan (IEP).

The inequity doesn’t end there. Twenty-one of the 56 administrative plans in place specifically keep local millage dollars from helping a student who attends school in the district through Schools of Choice. Washtenaw ISD collected more than $8,800 in local taxes per special education student in 2016, but families who live outside the boundary lines couldn’t see a penny of it spent for their child.

Other ISDs that send an unwelcoming message to neighboring special-needs kids cover Oakland and Macomb counties, Kalamazoo and the Traverse Bay region. In all, more than $455 million raised in ISD special education tax money can’t be used to help nonresident pupils. While one might argue that an ISD should spend the money it raises from a tax only on students who live within its boundaries, a few are even more restricting. They also deny the extra state dollars they receive to students who live across the boundary line but could use their services.

ISDs don’t have to take such a restrictive posture. In fact, most of their special education plans don’t allow a child’s home address to determine whether local tax dollars can help them.

Two other large ISDs, Ingham and Kent, occupy unique ground. In addition to serving students within their own boundaries, they also make their combined $118 million in local special education dollars available to students who live within a neighboring ISD. But their plans also govern services in five charter cyber schools that can serve students from across the state. Ingham and Kent effectively make cyber school options look less appealing for those who need special education services.

While Michigan has made strides toward more equitable student-based funding in general education, special education lags behind. It’s time to take the padlock off dollars that could help students with special needs, regardless of where they live.

Senate Bill 496: Criminalize endangering an animal by leaving it in a vehicle

Introduced by Sen. Curtis Hertel, Jr. (D), to make it a crime to leave an animal in a vehicle in conditions that could cause harm (too hot, too cold, etc.). The bill authorizes penalties starting at 45 days in jail if no harm ensues, and up to five years in prison if the animal dies. Republican Sen. Rick Jones sponsored a companion bill with sentencing guidelines. Referred to committee, no further action at this time.

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Senate Bill 508: Ban coal-tar driveway sealants

Introduced by Sen. Rebekah Warren (D), to ban the sale or use of coal tar sealant or other high PAH sealant for pavement. Referred to committee, no further action at this time.


House Bill 4723: Give immigrants in-state college tuition rates

Introduced by Rep. Yousef Rabhi (D), to charge in-state tuition at state universities and colleges to most resident aliens, including individuals who entered the country illegally as a child and have been granted a deferral from prosecution. This is part of a broader Democratic immigration package. Referred to committee, no further action at this time.


House Bill 4724: Restrict ‘stop and frisk’ to ‘reasonable suspicion’

Introduced by Rep. Ronnie Peterson (D), to prohibit law enforcement agencies from adopting “stop and frisk” policies. This would only be allowed if an investigating officer has reasonable suspicion to believe the person is, will or has been engaging in criminal activity, or the officer has reasonable suspicion to believe that the person is armed and dangerous. Referred to committee, no further action at this time.


House Bill 4728: Provide free counsel to deportation targets

Introduced by Rep. Erika Geiss (D), to require the state to provide legal services to an illegal immigrant who is subject to a federal immigration removal hearing, and does not qualify under the state law that requires counsel be appointed at no cost to indigent individuals being prosecuted for a crime. Referred to committee, no further action at this time.


House Bill 4731: Mandate target of 5 percent of state contracts go to immigrants

Introduced by Rep. Jim Ellison (D), to require state procurement officials ensure that businesses owned by immigrants get at least 5 percent of spending on state contracts. If this does not happen because such firms don’t submit bids, the governor would have report on actions taken to get more immigrant bidders. Referred to committee, no further action at this time.


House Bill 4736: Increase minimum age for tobacco

Introduced by Rep. Tommy Brann (R), to increase from 18 to 21 the minimum age to sell, buy or use tobacco. Referred to committee, no further action at this time.


House Bill 4743: Permit and regulate fantasy sports game betting

Introduced by Rep. Aaron Miller (R), to establish a permissive licensure and regulatory regime on fantasy sports games and contests that offer money prizes, with an initial license fee of up to $5,000 for would-be vendors. Referred to committee, no further action at this time.


SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit www.MichiganVotes.org.


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New Subsidies Show Which Groups Are Important to Lansing Politicians

Improving the rules for everyone puts residents first

The state recently approved its latest round of business subsidies, announcing that three companies would receive taxpayer money to create “at least” 1,500 new jobs. If history is a guide, few of these jobs will ever materialize. But monthly award announcements from the state serve as reminders that there are specific people that state lawmakers care about more about than residents.

Each of these announcements come with a real cost. The three companies mentioned in the latest announcement have had $9.75 million in taxpayer dollars dangled in front of them. In state budget terms, that’s not much. But it’s also a drop in the bucket of the $884 million in business subsidies the state is expected to deliver to favored companies in the upcoming year.

This is frustrating when there are many other things that can be done with this money. These dollars can be used to rebuild roads, pay teachers or even returned to taxpayers. The amount that we’re going to hand out this year is enough to decrease the state income tax to 3.9 percent from 4.25 percent. Instead, it gets spent on favors.

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There is hype around the projects that get state money, but these favors don’t do what their supporters say they do. They do not create jobs. In fact, they lose them. These subsidies also concentrate benefits in the hands of specific business owners, doing so at the expense of others. Every dollar awarded has to come from taxpayers in the first place. Or, it could have been spent anywhere else the state government wants. Perhaps a project with a wider public benefit.

Even if Lansing politicians justify the costs of their payments to business interests, they do not have the scope to improve the economy. In 2016, Michigan’s private sector both created 825,800 jobs and lost 779,810 jobs. State favors given through its primary business grant, the Michigan Business Development Program, only offered assistance to 84 companies to create 7,141 jobs. That’s less than 1 percent of jobs that disappeared during the period — and the state has a bad record of turning job announcements into reality.

Lawmakers should take their fingers off the scales and get back to the basics. Building a better environment for everyone to do business actually works. That means having a competent and effective government and setting up the same rules for everyone to play by. Then, lawmakers would be putting residents first.


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August 25, 2017 MichiganVotes weekly roll call report

The Legislature continues a summer break with no sessions scheduled until Sept. 6. Rather than votes this report contains some interesting or noteworthy bills introduced during the first half of the year.


Senate Bill 443: Revise definition of school bullying

Introduced by Sen. Darwin Booher (R), to revise the definition of “bullying” in a state law mandating that schools adopt response policies, by expanding it to include an action that “involves a real or perceived power imbalance between pupils.” Referred to committee, no further action at this time.

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Senate Bill 475: Mandate 50 percent of Michigan electricity come from renewables

Introduced by Sen. Rebekah Warren (D), to mandate that at least half the electricity consumed in Michigan be generated from renewable sources. Nationwide, not counting hydro-power from dams, renewable sources provide 8.4 percent of U.S. electricity. In Michigan adding renewable sources primarily means more wind turbines, of which there were nearly 900 when the bill was introduced. Referred to committee, no further action at this time.


Senate Bill 477: Define “reduce and maintain a safe speed”

Introduced by Sen. Dale W. Zorn (R), to amend a law that requires drivers to move over or "reduce and maintain a safe speed" when passing police or emergency vehicles on the side of the road. The bill would define “reduce speed” as slowing down by at least 10 miles an hour. Referred to committee, no further action at this time.


Senate Bill 487: Ban “Redskins” team name in public schools

Introduced by Sen. Wayne Schmidt (R), to prohibit public school groups or teams from being named “Redskins.” Referred to committee, no further action at this time.


Senate Bill 488: Establish foster care alternative

Introduced by Sen. Peter MacGregor (R), to establish a potential alternative for court-ordered foster care that would allow a parent or guardian to sign a “safe families” power of attorney form delegating to another person the care, custody or property of a minor child for up to 180 days with no intimation of “abandonment,” subject to rules prescribed by the bill including background checks, home inspections and more. Unlike foster home providers, the delegated caretaker would not get per diem payments from the state. Referred to committee, no further action at this time.


House Bill 4621: Earmark more income tax to schools, repeal EITC

Introduced by Rep. James Lower (R), to increase the share of state income tax earmarked to public schools. Also, to eliminate the state earned income tax credit, which grants recipients an amount equal to 6 percent of the federal EITC, which is a refundable tax credit (or “reverse income tax”) that sends checks to low income workers. Referred to committee, no further action at this time.


House Bill 4622: Establish vehicle insurance verification systems

Introduced by Rep. Peter Lucido (R), to require vehicle insurers and state officials to establish a system for verifying the insurance status of vehicles in something closer to an ongoing “real time” basis, for purposes of enforcing the state’s mandatory no fault insurance regime. House Bill 4623 would cancel the vehicle registration (license plate) if the system indicates the vehicle is not insured. Referred to committee, no further action at this time.


House Bill 4645: Prohibit independent corporate subsidy agency revenue sources and spending

Introduced by Rep. Martin Howrylak (R), to no longer allow the Michigan Economic Development Corporation (and its parent agency the "Michigan Strategic Fund") to automatically get Indian casino gaming compact revenue and other "off budget" sources. These agencies' staffers and political appointees select particular firms and developers to receive direct and indirect subsidies. Under the bill, all of these agencies' revenue and assets would be “declared public money and assets” and could only be disbursed through an appropriations bill passed by the legislature. Referred to committee, no further action at this time.


House Bill 4686: Authorize local rent control mandates on landlords

Introduced by Rep. Stephanie Chang (D), to give local governments the power to impose a rent control mandate on landlords, requiring them to limit rent for tenants who are disabled or older than age 70 to no more than 50 percent of their income. Referred to committee, no further action at this time.


House Bill 4720: Ban investigating or enforcing immigration law violations

Introduced by Rep. Abdullah Hammoud (D), to prohibit state or local law enforcement agency funds, personnel or resources from being used to investigate, interrogate, detain, detect or arrest individuals for immigration enforcement purposes. Referred to committee, no further action at this time.


SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit www.MichiganVotes.org.


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The Key Barriers Promoting Inequality

Some agreement between the left and the right

As long as people have different interests and abilities, in a free society, there will be some income inequality. But government-imposed barriers can make it more pronounced by placing unnecessary obstacles in front of people trying to get ahead.

Economists across the spectrum are concerned about this problem. And there is some agreement about how to help fix it.

In his book “Coming Apart,” Charles Murray of the American Enterprise Institute shows an increasing divergence between how the middle and upper classes live. In 1960, regardless of a woman’s income level, many fewer children were born out of wedlock, attendance at religious institutions was higher, a work ethic was shared across income levels, and family life and civil society were more valued. Today, increasingly, there is a split. Those who are in what Murray calls the “New Upper Class” tend to still exhibit these habits and characteristics, but the “New Lower Class” has diverged significantly from them.

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Richard Reeves of the Brookings Institution, unlike libertarian Murray, is a more left-leaning scholar, but he also focuses his research on social mobility. In “Dream Hoarders,” he shows how the top 20 percent of income earners are increasingly separating from the lower 80 percent. The results are a split that, he writes, “can be seen in family structure, neighborhoods, attitudes, and lifestyle.” While many values are shaped through the family, government policies often mean this divergence between the classes is perpetuated.

Both books document a similar problem and the authors agree on some solutions. While Murray doesn’t provide precise solutions (outside of saying that the “new upper class” should “preach what they practice”), he has consistently pointed to overly burdensome government regulations of the economy as a key obstacle to greater social mobility, particularly for the middle class and poor.

Reeves points to government regulations too, such as occupational licensing (increasingly affecting working class jobs), zoning laws and a lack of quality educational options. He calls these examples of “opportunity hoarding” by the upper class.

The bulk of the economic research supports both authors’ concerns about regulation (see a review in my recent study on licensing at www.mackinac.org/licensure). It isn’t the rich or well-educated who often have problems with zoning (they can afford more expensive houses in suburbs and the commute to the city) or licensing burdens (they can navigate the rules and pay the fees). But these obstacles pose a significant challenge for people in the middle class and working class as they try to qualify for steady employment and find safe, affordable housing.

It is always important to continue to find ways to make social welfare programs more efficient. But if government-created barriers to entry to the “good life” aren’t removed, no amount of tinkering with government assistance programs will do. It won’t be enough to overcome the challenges facing people who just want to get ahead and do better for themselves and their families — what some call the American Dream.


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