By Ben DeGrow
Michigan’s K-12 students are not the only ones who appear to have not learned enough during the pandemic. The governor, ignoring the important role cyber schools have filled with regular classrooms shut down, has repeated her earlier budget missteps by singling out these schools for fiscal harm.
By Jack McHugh
The legislature met this week but held no votes on bills of general interest. Rather than votes, this Roll Call Report describes some newly introduced bills of interest.
Senate Bill 13: Give tax break to certain business owners and developers
Introduced by Sen. Dale W. Zorn (R), to give tax breaks equal to 50% of their state business tax liability by certain developers and business owners selected by political appointees on the board of a state Strategic Fund agency. If the tax break exceeded the firm’s tax liability the difference could be applied to future tax bills for up to 10 years. Referred to committee, no further action at this time.
Editor's Note: The original Spanish version of this piece can be found here.
Research shows strong correlations between economic freedom and prosperity — among other positive outcomes. This means that where we live can have an impact on the economic and other opportunities we enjoy for ourselves, our family and our community.
Editor's Note: This article was first published in The Hill on January 23, 2021.
One of the first tests the Biden administration will face is whether it will protect independent workers or give in to special interests.
On Jan. 6, the Department of Labor finalized a rule to ensure that many entrepreneurs who want to work for themselves can do so. The rule takes a commonsense approach to classifying workers as either employees or independent contractors. As former Secretary of Labor Eugene Scalia wrote for Fox Business, the rule “respects the time-honored American tradition of being your own boss.”
Gov. Gretchen Whitmer again tweaked her epidemic orders that restrict individual behavior, now permitting contact sports. But the governor continues to maintain strict limits on social gatherings. A look back at these restrictions over time makes the current ones hard to justify. It appears as if the governor now believes that social gatherings are one of the most dangerous activities when it comes to spreading COVID-19.
The Indiana General Assembly is contemplating a $1 per pack cigarette tax hike, with a bill introduced last week in its House Committee on Public Health. If adopted as law, the bill would raise the state’s tax rate to $1.995, nearly equaling Michigan’s current tax rate of $2 per pack. This has important implications, given the degree to which cigarette tax differentials among states drive illicit behavior, such as smuggling.
The Michigan Department of Natural Resources is responsible for managing the state’s natural resources and for balancing the interests of businesses, residents and visitors to the Great Lakes. The DNR’s recent decision to overhaul fishing regulations and delay the licenses for commercial fishers, however, appears to have tipped the scales against one interest without sufficient reason.
An op-ed last month in The Detroit News, headlined “National Popular Vote Upholds American Ideal,” argues against the Electoral College. It’s written by Saul Anuzis, a lobbyist hired by the organization pushing the National Popular Vote Interstate Compact. It makes more than a few dubious claims.
On Nov. 18, Gov. Gretchen Whitmer and the Michigan state health department put in place some of the most severe restrictions on businesses and individuals in the country at the time. They banned indoor dining, shut down high schools and colleges for in-person classes, closed bowling alleys and movie theaters and even prohibited ice skating and outdoor group exercises.
Editor's Note: This piece was originally published in The Detroit News on February 3, 2021.
Budget forecasts show that the state is expected to remain in good fiscal condition through the end of the current year and into the next. These estimates reveal that the combination of substantial federal relief funds, better-than-forecasted state tax collections, and state spending cuts generated a $3.7 billion surplus for the 2020 fiscal year that ended last October. Some of that surplus has been allocated in the current 2021 budget, but nearly three-quarters has yet to be appropriated.
Editor's Note: This piece was originally published in The Hill on January 16, 2021.
This month and the last brought arrests and prison sentences for smuggling cigarettes and other contraband into correctional facilities in Kansas and Maryland, respectively. Lawmakers considering hiking cigarette taxes ought to note: Higher taxes encourage more illegal smuggling into a state, and if law enforcement can’t keep illicit smokes out of prisons, there is little hope of keeping smuggled ones out of the hands of the public.
Some in the Michigan film industry want to be subsidized by taxpayers, again. Lawmakers were smart to stop doing this in 2015 and should reject their latest calls. It was a waste of money then and would be a waste of money now.
The basic problem is that the benefits are not worth the costs. Taxpayers spent $500 million subsidizing film production from 2008 to 2015, through one of the nation’s most generous programs. Film producers got a check from taxpayers for up to 42 cents for every dollar they spent. And even with that extravagance, nothing took root from the $500 million spent.
The government mandated minimum wage is a hot topic right now as President Biden looks to hike the federal requirement to $15 per hour. The Mackinac Center for Public Policy has expressed its opposition to similar mandates in the past and — for the same reasons as before — signed onto to a coalition letter led by Americans for Tax Reform and released on Tuesday.
By Jack McHugh
House Bill 4019: Allocate new federal coronavirus relief dollars to schools: Passed 59 to 50 in the House
To appropriate $868.5 million in recently-approved federal coronavirus relief money, which is about 25% of the entire amount available to the state, with the rest to be allocated later. The appropriation directs $510 million federal dollars to expand food stamp distributions and related programs; $165.5 million for household rent and utility subsidies; $143.7 million for coronavirus testing and contact tracing; and smaller amounts for other purposes.
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Last week, the University of Michigan School of Public Health released a series of seven Powerpoint slides that attempt to show that Gov. Gretchen Whitmer’s recent lockdown policies resulted in “2,800 lives saved.” The analysis relies on a predictive simulation built on several questionable assumptions, and the slides offer few details about how the estimate was generated. But one thing is clear: This report does not measure the impact of the governor’s orders, but simply assumes that they worked as intended. And even if these assumptions were true and the report had a perfectly tuned predictive model, its findings are exaggerated.
By Ben DeGrow
Gov. Gretchen Whitmer correctly noted in Wednesday’s State of the State address that “COVID exposed deep inequities in our education system.” Yet her latest K-12 funding proposal further tips the scales against students in certain public schools.
In her address, the governor reiterated her desire to provide more funding to help disadvantaged students. But her determination to follow through on that principle remains very much in doubt.
“What would you say ... you do here?” It’s not only an infinitely quotable question from Office Space, but also a question anyone who has worked at a think tank or public policy organization has been asked many times.
The Mackinac Center’s Executive Vice President Mike Reitz recently appeared on the “Great.com Talks With” podcast, titled “How to Balance Individual Freedoms With the Government's Role.” Unlike Tom Smykowski, Reitz had a better explanation for why the Mackinac Center exists and what it does.
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Many people believe that politics is rotten, believing, to paraphrase the lead character in a Robin Williams movie, that “Politicians should dress like NASCAR drivers so we can know who bought them.” But after I used my podcast, The Overton Window, to interview people who have successfully changed policy, I can confirm that this view is unjustified.
By Jack McHugh
The new 101st Michigan Legislature resumed sessions this week after a week-long suspension. It will likely be several more weeks before new bills advance through committees and are taken up by the full House or Senate for a vote.
There was one politically meaningful action this week when the Senate Republican majority brought forward a vote to disapprove 13 administrative board and commission appointments made by Gov. Gretchen Whitmer.
By Ben DeGrow
Editor's Note: This article first appeared in The Detroit News on January 25, 2021.
“I thought our local public school was going to enrich our lives,” said Michigan mom Katie Woodhams, explaining why she needed to change her children’s learning environment. “I never imagined my kids would come home from school crying every day.”
Gov. Gretchen Whitmer took time at her latest press conference to slay a myth, saying “Things have not been closed for eight months.” It is true, of course, that the economy is not and was not ever fully shut down. But the governor’s attempt to regulate nearly every aspect of our social lives promotes the public perception that this is what happened, because her approach is to prohibit everything except that which she specifically allows.
Michigan policy can encourage job growth with a simple change to how its corporate income tax system treats the cost of equipment.
When the state taxes a business based on how much income it earns, state administrators have to figure out how the business should account for its expenses when it calculates its tax obligation. A business only has income if it earns a profit, and profits are what a business earns above its costs. So if a restaurant sells a $10 sandwich that costs it $7 to make, then it pays taxes on the $3 of profit.
Gov. Gretchen Whitmer announced a $5.6 billion pandemic recovery plan for Michigan on Tuesday, and she included in her proposal a call for more corporate handouts. Chief among her ideas is renewing the so-called Good Jobs for Michigan program.
That the governor said she wants to expand corporate handout programs should not be a surprise given her legislative history. What would be a surprise is if these handouts worked this time around. Research shows that they are not effective and come at great taxpayer expense. Lawmakers should reject her call to renew GJFM, along with other corporate and industrial welfare programs.
Editor's Note: This article first appeared in The Hill on December 28, 2020.
In the spring, many families were willing to give schools the benefit of the doubt as they adjusted to distance-learning programs, but it looks like time has run out on that goodwill. Part of the frustration is tied to students’ learning losses in key subjects such as math. Even more significant, perhaps, are concerns about mental health and child care.
Michigan Gov. Gretchen Whitmer called on lawmakers to spend more on a business subsidy program because the Pfizer plant in Michigan that produces a COVID-19 vaccine received taxpayer money. This is a weak justification, as the relationships between state subsidies and vaccines are unclear. And policymakers should be careful not to leverage the pandemic for unrelated policy preferences.
