The real question before the Supreme Court in the "Patient Protection Act" challenge was: Does a Constitution restricting government to limited and enumerated powers actually mean anything, or are we now subject to the whims of temporary majorities elected to Congress?
According to Casey Sumner of the Toledo Blade, Gov. Snyder said, “The role of government isn't to create jobs. Our role is to enable job creation to happen,” during a town hall meeting on Monday. However, the new budget of the State of Michigan includes $100 million for “business attraction and economic gardening” and $50 million for a film incentive program. Rather than cripple the job creation he desires, Gov. Snyder could best increase Michigan employment rates by abandoning such taxing initiatives and allowing free enterprise to thrive.
A new report issued by the Heritage Foundation quantifies the impact by state and congressional district of the widely-heralded “Taxmageddon.” Absent any change in the law, it will deliver the full body slam of a $494 billion tax hike to the U.S. economy on Jan. 1, 2013.
Two more Michigan school districts have earned praise for implementing merit-based teacher pay.
Blissfield Schools and the St. Clair intermediate school district join Oscoda and Suttons Bay in transitioning away from an industrial-era assembly line worker type compensation system to one that recognizes and rewards teachers as motivated professionals. There are reasons to think this may be the start of a trend.
Op-Eds in the Tallahassee Democrat and Orlando Sentinel about public-sector pension reform in Florida both reference a Mackinac Center study from 2011 that shows closing the state employees’ defined-benefit retirement fund to new hires in 1997 has saved Michigan taxpayers up to $4.3 billion in unfunded liabilities.
The Michigan Legislature has entered a summer recess. Many bills were passed in the legislative sessions just before the break.
Y = Yes, N = No, X = Not Voting
Senate Bill 1129, Authorize local “pension obligation bonds”: Passed 25 to 11 in the Senate
To allow local governments to borrow money to cover unfunded employee pension liabilities if the local has closed its traditional “defined benefit” pension system to new employees. Unlike other local government borrowing (usually called “bonding” or “selling bonds”), no vote of the people would be required.
There's a lot of criticism being voiced about plans to "charterize" the fiscally and educationally bankrupt Muskegon Heights and Highland Park school districts. Government employee unions are making the most noise, but they've been joined recently by the Detroit Free Press, Michigan Public Radio’s Jack Lessenberry, and a state school board member.
New data from the state (available in this online database) show that despite constant calls from school officials and government employee union bosses for more funding, public schools in Michigan received more money in 2011 than ever before — about $13,405 per pupil. Total school spending, however, did drop from its all-time high in 2010 — by less than 1 percent. Schools spent $12,778 per pupil last year overall, with $11,561 of that spent on day-to-day operating expenses.
Senior Economist David Littmann in a Detroit Free Press Op-Ed Sunday details Detroit’s consent agreement with the state and the roadblocks the city faces as it tries to regain financial stability. He also discussed the same issues on WDET, Detroit's public radio station.
Millions of dollars in “dues” will continue to be skimmed by the SEIU from the subsidy checks home health care workers receive, many of whom are family members caring for loved ones, after a federal judge issued an injunction against a new state law. Patrick Wright, director of the Mackinac Center Legal Foundation, discussed the issue on “The Frank Beckmann Show” on WJR AM760. Wright also told The Detroit News that the SEIU is taking about $500,000 a month away from the home health aides.
Allen Park’s foray into the state’s film subsidy industry has put the city into debt and put it on the verge of needing an emergency financial manager, according to an Op-Ed by two Mackinac Center analysts in the Port Huron Times-Herald.
Director of Fiscal Policy Michael LaFaive and Senior Editor Thomas Shull write that the state’s “ill-conceived” film subsidy program led Allen Park officials to believe the city could profit by building a movie studio. The authors then explain the state’s legal history of prohibiting the use of public money for private ventures.
School districts sometimes are referred to as a "local educational agency," but recently the one in Fruitport seemed more concerned with being a "local employment agency."
MLive.com reports that the school board voted against saving $240,000 by contracting out for custodial services — money that could be redirected toward educating students. The president of the janitor’s local union said board members, "felt that people shouldn't lose their jobs right now" and, according to MLive.com, specifically praised those on the board who have "ties to labor."
An increase in tobacco taxes in Illinois has led to concerns about cigarette smuggling and related crimes, according to the Chicago Examiner.
The news site cites Mackinac Center research on the issue, including this 2008 study.
Although the health care field has taken over the top spot in Michigan’s economy, one Mackinac Center analyst warns it will not return the state to prosperity because it lacks productivity.
Senior Economist David Littmann told The Detroit News that manufacturing jobs have more of an “economic wallop.”
Vincent Chin died 30 years ago today after being beaten with a baseball bat by laid-off autoworkers. He is memorialized by Tom Watkins in an excellent piece in The Detroit News today. Chin, a Chinese-American was celebrating his impending nuptials when he crossed the path of two xenophobes apparently bent on venting their frustrations on a man they mistook for Japanese.
Unions in Michigan are pushing for a radical constitutional amendment that would benefit the 3 percent of state residents who are unionized at the state, local and school levels at the expense of everyone else, according to a commentary by Labor Policy Director Vincent Vernuccio in The American Spectator.
The Michigan House has advanced legislation to gradually roll back the state’s personal income tax rate to 3.9 percent from its current 4.35 percent. That would be a good start, but a slight blip upwards in the state unemployment rate reported last week suggests this is no time for being timid or complacent.
Y = Yes, N = No, X = Not Voting
House Bill 5699, Cut state income tax: Passed 31 to 7 in the Senate
To move forward to Oct. 1 2013 an income tax cut from 4.35 percent to 4.25 percent that under current law will happen on Jan, 1, 2013.
Municipalities that institute cost recovery fees for emergency services could be double taxing residents, a Mackinac Center analyst told the Port Huron Times-Herald.
Michael LaFaive, director of the Center’s Morey Fiscal Policy Initiative, said the fees could be a “tax by another name” if the municipality already pays for police and fire services through an operating millage. LaFaive also noted, however, that such fees can reduce the overconsumption of said services.
Michigan House Republicans have declined the invitation extended by the state Senate to close the school employee pension system to new hires, a transformational reform that would gradually eliminate the state’s 50-year pattern of chronic pension underfunding.
An article in The New York Times documents the craziness of current licensing laws across the nation.
In “So You Think You Can Be a Hair Braider?” the author focuses on Jestina Clayton, a Sierra Leone native who came to America, went to college, got married, had children and then tried to start her own business. Clayton lives in Utah, where she does a style of African hair braiding and found a niche market, providing for her family and creating value and wealth in the community.
The union-backed attempt to rig the Michigan Constitution is drawing state and national media attention after supporters submitted signatures Wednesday to get the measure on the November ballot.
“It is apparent that government unions did not learn anything from the Wisconsin recall vote last week,” Vincent Vernuccio, the Center’s director of labor policy, told CNBC, Bloomberg and CBS News. “Once again they’re pursuing policies that will enshrine special privileges for what amounts to just 3 percent of the population at the expense of the rest of us.”
Teamsters President James P. Hoffa writes in The Detroit News that the U.S. government should offer subsidies for companies to return outsourced jobs back to American soil. But buying back these jobs with tax money is unlikely to have any meaningful impact on the economy and be rife with special favors to Congressional cronies.
Mackinac Center research on the amount of money taxpayers have saved since the defined-benefit retirement system for new state employees was closed in 1997 was cited in a recent Wall Street Journal editorial.
The Journal writes about the reluctance of Republicans in the Michigan House to do the same with the school employees’ retirement system, which is underfunded by tens of billions of dollars. The Toledo Blade also cited this fact. And The Oakland Press ran a commentary by Senior Legislative Analyst Jack McHugh about the matter.
When comparing the costs of the current "defined benefit" school retirement system to a defined-contribution system, some state analysts argue that the latter is more expensive.
Unfortunately, the claim is based on a rigged comparison. A defined-contribution plan will only cost as much each year as legislators want it to, something their official analyses ignore.
