Editor's Note: This article was first published in The Hill on December 18, 2021.
A lot of ink has been spilled describing the $1.9 trillion American Rescue Plan Act (ARPA), adopted in March. It is designed to help the country recover from the negative effects of the COVID-19 pandemic, including economic ones. A case can be made that the U.S. economy would have recovered on its own and that this newest federal spending blowout was unnecessary.
By Jason Hayes
On Dec. 15, Enbridge Energy requested to have a 2019 lawsuit, brought by the state of Michigan against the company’s Line 5 pipeline, moved from state courts to the federal court that is presiding over another Line 5 case. Upon hearing of the company’s request to combine the cases before the same federal judge, Michigan Attorney General Dana Nessel fumed that the company’s move was an “outrageous maneuver.” She characterized the request as a “flagrant attempt to undermine” a federal rule that typically limits this type of request to within 30 days of a case’s initial filing. The energy company argues that a recent judicial ruling effectively reset the 30-day provision.
Special interest groups looking for public policy favors don’t necessarily have to go through the budget process to get taxpayer cash. There are other ways to get money, which spare them the trouble of having to argue with other spending interests over scarce resources. One often-used method is to create a new tax credit program.
This past year saw significant changes in labor policy throughout the country, both good and bad. As the year comes to a close, it’s important to reflect on successes of those dedicated to worker freedom, while never losing sight of the ongoing threats to it in the year to come.
When the end of the year is in sight, it’s common for people to look back on the outgoing year to reminisce on the memories made and accomplishments earned. This year, we here at the Mackinac Center thought we would take a look at our top highlights from 2021 in the form of a popular Christmas song ‑ the 12 days of Christmas!
By Ben DeGrow
There are unprecedented piles of federal cash at Michigan school districts’ disposal. What truly creative ideas will they embrace to help as many students as possible?
Michigan public schools are collecting an extra $6 billion in combined COVID relief. Most of the money was doled out in a highly uneven fashion, which heavily favored districts that provided little or no in-person instruction last school year. Earlier this year, the Legislature redirected $362 million to raise the funding floor and help alleviate the disparity. Three-fourths of districts will end up with $1,100-$6,000 per pupil from these specific pots of money. Nearly all other districts are taking in far more.
Contracting out with private companies to provide support services has been a time-tested way for school districts to save money and improve their operations. The Mackinac Center has surveyed districts going back to 2001 to find out just how many contract out for food, custodial and transportation services. We found that contracting increased from 31.0% of school districts in 2001 to 69.6% in 2021.
By Jack McHugh
Senate Bill 85: Authorize spending $1 billion on new corporate subsidy program: Passed 25 to 11 in the Senate
To appropriate $1 billion for a new corporate subsidy scheme. The money would pay for a “Critical Industry Fund” to give grants and loans to certain companies to create jobs or job training, and a “Strategic Site Readiness Fund” to give others money to create “investment-ready sites” for new plants and facilities. The bill also appropriates $409 million for relief to businesses "afflicted" by the coronavirus epidemic and responses, and $75 million to reduce personal property taxes levied on business tools and equipment.
Late 19th-century America has the reputation as operating under free-market policies — not because of anything that went on in the federal government, but because of a bottom-up citizen reaction to failed policies in the states. It put in place important limitations on state governments’ ability to support private business with tax money. The limitations stand in the law even today, but courts have, in various opinions, reduced them to near-irrelevance. I spoke about these laws, and their changing role, with Matthew D. Mitchell and Jonathan Riches, co-authors of the report, Outlawing Favoritism: The Economics, History, and Law of Anti-Aid Provisions in State Constitutions, published by the Mercatus Center.
By Ben DeGrow
Editor's Note: This article first appeared in The Hill on November 6, 2021.
New research shows a key part of Democrats’ education agenda would deeply discriminate against thousands of Detroit students.
Back in the summer, the Democratic-majority U.S. House of Representatives narrowly passed legislation to continue funding the U.S. Department of Education. As approved, House Resolution 4502 would deny all federal funding to any charter school that “contracts with a for-profit entity to operate, oversee or manage” its activities. These entities are commonly known as education management organizations, or EMOs.
By Jason Hayes
Editor's Note: This article first appeared in The Detroit News on December 10, 2021.
Gov. Gretchen Whitmer claims she wants to limit the costs that ever-changing energy policies impose on Michigan residents. We’re interested to see if she’s really serious about helping lower energy costs.
An ongoing legal case raises the question: Who owns public school students?
Earlier this month, the Michigan Court of Appeals weighed in on a longstanding legal tussle between two metro Detroit school districts. The proceedings date back a decade, when Warren Consolidated School District first sued the School District of the City of Hazel Park. Warren argues that Hazel Park was “wrongfully depriving [it] of students.”
By Jack McHugh
Senate Bill 770: Create new corporate subsidy program: Passed 27 to 10 in the Senate
To create one of the corporate subsidy accounts Senate Bill 769 would authorize, to be called the “Strategic Site Readiness Fund,” which would give grants and loans to certain companies to create “investment-ready sites” for new job producing plants and facilities.
By Ben DeGrow
If the leaders of Michigan school districts have one wish this holiday season, many might ask for more qualified teacher candidates. To the extent this need is real, there are policy changes the state Legislature can adopt to grant their request.
Demand for teachers in Michigan public schools has risen, at least relative to the number of students in classrooms. State Superintendent Michael Rice has sounded the alarm, declaring a “teacher shortage crisis” and touting a goal for the state to certify more instructors for K-12 classrooms.
The costs of college seem to be spiraling upwards endlessly. Jenna Ashley Robinson, president of the James G. Martin Center for Academic Renewal, has a simple solution: Make schools responsible when their students default on their debt. I spoke with her about her idea for the Overton Window podcast.
Editor's Note: This piece first appeared in The Detroit News on November 22, 2021.
Some Michigan lawmakers want to hand out $300 million in taxpayer support to select businesses. States all over the country have tried to improve their economy with business subsidies, but with little success. They’re ineffective at creating jobs, expensive to the state budget and unfair to the businesses that don’t get them.
To hear politicians talk, you’d think that landing big business projects with taxpayer spending would make them Prometheus incarnate, bringing fire to man.
In a recent announcement that the state had approved a $250,000 payment toward a company’s expansion, Gov. Gretchen Whitmer pledged that she would “continue building up Michigan's economy and usher in a new era of prosperity together."
Flint Community Schools is on its third superintendent in two years. The previous superintendent abruptly resigned and is suing the district, amid in-fighting on the board. In short, the school system is a mess.
The district’s enrollment has fallen for decades and is now in a state of collapse. In 2002, about 21,000 students were enrolled, a number which dropped to about 11,500 in 2010. As of last year, the district was down to about 3,000 students, and it has been approved for more than $156 million in federal COVID relief money. That’s more than $50,000 per student, by far the most for any school in Michigan.
The U.S. House of Representatives has narrowly passed the “Build Back Better” plan. This is the latest of several federal spending bills that have added trillions of dollars in debt in just the past two years.
All Michigan congressional Democrats supported it: Reps. Dan Kildee, Elissa Slotkin, Andy Levin, Haley Stevens, Debbie Dingell, Rashida Tlaib and Brenda Lawrence.
The House and Senate are on break until Nov. 30, so rather than votes, this report describes some of the many “economic development” bills introduced this year to give selective subsidies and tax breaks to certain corporations and developers.Around 20 such bills have been introduced in 2021, with two already signed into law and several others passed by either the House or Senate (but not both). This report describes some of those that have not yet received a vote.
Leon Drolet had a very good 2006. That year, voters approved two initiatives to amend the state constitution, and he had worked on both. I spoke with him for the Overton Window podcast about his different roles in those campaigns.
The first initiative banned the use of race preferences in state government, including for university admissions. The other prohibited the use of eminent domain to take a person’s property for economic development purposes. And though both wound up on the ballot in 2006, he played very different roles in each.
The Canada-based Fraser Institute has released its annual Economic Freedom of North America report, and Michigan is ranked at an uninspiring 34th among the states for economic liberty. This reveals a relatively poor set of policy choices that limit opportunity for our citizens.
By Ben DeGrow
Adapt or falter: That may be the choice facing Michigan’s local K-12 public school systems in the wake of prolonged disruptions brought on by COVID. One area where schools and families need more flexibility is transportation.
As is the case in so many activities these days, the task of getting children to and from schools is afflicted by a tight labor market. Bus drivers, whether employed in-house or contracted through a private business, are widely reported to be in short supply. Fewer drivers are coming back to work after pandemic-induced school closures sidelined their services. The situation is so bad that the superintendent of one small mid-Michigan district earned a commercial driver’s license so he could pitch in on some bus routes.
State lawmakers are sitting on an extraordinary amount of cash right now. Between federal government transfers to the state budget — financed by the national debt — and unexpectedly strong state tax collections, policymakers have at least $11 billion sitting around. That’s the equivalent of 34% of all of the money the state collected from its taxes and fees prior to the COVID-19 pandemic.
Legislation being considered in Michigan would prevent municipalities from banning short-term rentals. Local government officials and the taxpayer-funded groups that represent them in Lansing are fighting against the bill. But their arguments are shallow and sometimes nonsensical.
