Legislation currently before the West Virginia House would raise cigarette excise taxes by a dollar per pack and with it the amount of illicit smuggling of cigarettes to the Mountain State.
We have been estimating the degree to which cigarettes are smuggled from state to state since 2008, working in recent years with the Tax Foundation of Washington, D.C. Typically cigarettes are moved by individuals and organized crime units from low-tax states to higher-taxed states. Some states permit a small amount of legal cross-border cigarette shopping, so not all cross-border activity counts as illicit smuggling, though those transactions are swept up into our model.
By Jack McHugh
House Bill 5105, Extend Medicaid health insurance claims tax: Passed 21 to 17 in the Senate
To extend until 2020 the 2017 sunset on a 0.75 percent tax on health insurance claims, which is designed to game the federal Medicaid program in ways that result in higher federal payments to Michigan’s medical welfare establishment.
Mackinac Center Vice President for Legal Affairs and Director of the Mackinac Center Legal Foundation Patrick Wright joined the Let it Rip show on Fox 2 last week to discuss the death of Justice Antonin Scalia and the process of appointing a replacement.
By Ben DeGrow
The National Cherry Festival in Traverse City is more than four months away, but when it comes to the record of charter schools, Education Trust-Midwest has started picking early.
Ed Trust tried to stake a claim in the debate about Michigan's lackluster educational performance by aiming squarely at a small sector of public education: charter schools. It's appropriate to have a discussion about what more charter schools could do to help drive improvements. And reasonable observers can express frustration that charters haven't raised the bar high enough.
Mackinac Center research was used to inform two Wall Street Journal articles in as many weeks.
The first article, announcing West Virginia’s move to become the nation’s 26th right-to-work state, cites Mackinac Center research showing that worker freedom has a positive impact on jobs and income.
Michigan’s economy performed poorly during the 2000s, only to be hit hard by the recession near the end of the decade. While growth in the current decade has been tepid in Southeast Michigan, the Grand Rapids area is a boomtown. The region fully recovered from the recession and has grown beyond its peak in 2000.
The Michigan Public Elementary and Middle School Context and Performance Report Card released by the Mackinac Center last week garnered media attention across the state of Michigan.
Ben DeGrow, education policy director at the Center, explained to The Times Herald that the CAP report card is unlike many other school rankings because it adjusts for student poverty level to provide the most accurate assessment of performance.
Every month, the Mackinac Center publishes three essays on timely public policy issues. Find out more about February's selections below:
Michigan Worker's Compensation Reforms Have Succeeded by Gerald M. Marcinkoski
Reforms made in 2011 to Michigan’s workers’ compensation law have been successful, reducing premiums and establishing a solid legal framework for everyone.
By Jack McHugh
Senate Bill 599, Revise, increase register of deeds fees: Passed 31 to 7 in the Senate
To authorize a flat $30 fee for recording a document with a register of deeds regardless of how many pages, instead of the current charge of $8 plus $3 for each additional page. The bill also increases related fees, and would index the fees to inflation.
Michael LaFaive, director of the Morey Fiscal Policy Initiative at the Mackinac Center, was recently quoted in a Detroit Free Press article regarding a possible conflict of interest.
The article explores the possibility of “a ‘revolving door’ between the public and private sectors” in the construction of the new Red Wings arena in Detroit. Recently, the developers of the arena hired the consulting firm started by George Jackson, who was a lead negotiator for the city on the arena deal when he served as a Detroit economic development chief.
An op-ed by the Mackinac Center’s Director of the Morey Fiscal Policy Initiative Michael LaFaive and Board of Scholars member Todd Nesbit was published this weekend by the Lincoln Journal Star in Nebraska.
The piece explained the unintended consequences that would come from raising cigarette taxes by more than 234 percent in The Cornhusker State, a proposal introduced by Sen. Mike Gloor. While Nebraska’s smuggling rate is quite low — 2.8 percent in 2013 — raising per-pack taxes from 64 cents to $2.14 would increase the smuggling rate to 32.3 percent, according to the analysis provided by LaFaive and Nesbit.
By Jack McHugh
Senate Bill 302, Impose ban on nude entertainment in bars: Passed 27 to 10 in the Senate
To ban fully nude performers at topless bars, or bars showing videos that depict this. This relates to a 2007 federal appeals court ruling that struck down Michigan’s previous law banning fully nude performers in bars, holding it was a violation of the First Amendment. The bill would specifically ban a performance that “exposes to public view the pubic region, anus, or genitals.”
The largest proposed change in Gov. Rick Snyder’s executive budget is to use money freed up by a tax hike for roads to pay for the state’s Medicaid expansion.
Normally, roads are paid by vehicle registration and fuel taxes. While waiting to agree on a long-term funding plan for the roads, policymakers devoted more of the state’s general tax revenues to road repair. They found $400 million for the current year’s spending.
Gov. Rick Snyder recommends spending $61 million more than last year on Michigan’s 15 state universities — a 4.3 percent increase. If the Legislature wants to do a favor for taxpayers as well as keep a handle on tuition increases, it should not approve this hike in spending.
Yesterday saw the early death of the Mackinac Center’s former senior fellow in education policy, Andrew Coulson. Andrew was the victim of brain cancer — a malignancy that he fought with all of the energy, intelligence, grace and good humor that characterized his life and work.
Mackinac Center’s Director of Labor Policy F. Vincent Vernuccio joined the Wall Street Journal to discuss his recent work in West Virginia, which is on track to become the nation’s 26th right-to-work state.
Friday, hours after the West Virginia Senate signed off on a bill that would give workers in the state the freedom to decide whether or not to join a union, Vernuccio spoke about the growing trend toward worker freedom and how right-to-work improves lives and can make unions stronger.
By Jack McHugh
Senate Bill 136, Flint water contamination response - rebate water bills: Passed 37 to 0 in the Senate
To appropriate $30 million from state revenue (not federal) to provide water bill refunds to Flint households that were paying for contaminated water.
By Ben DeGrow
Finding solutions to help Detroit students not only requires recognizing the problem. It also requires a clear picture of the facts and understanding how the current system works.
In a recent MLive column, Ann Arbor attorney Eli Savit offers a well-intentioned but misdiagnosed policy proposal to address the genuinely disturbing images of mold and vermin found in some Detroit Public Schools buildings. He calls on Lansing leaders to fix the state’s “regressive school-finance system and earmark state funds for school building projects in poorer districts.”
People expect the impossible from state politicians on economic matters: “Create jobs.” The demand on politicians to create jobs leads them to throw taxpayer money at business projects, though the effort is counterproductive.
To show that they’ve listened to the call to create more jobs, politicians need examples of businesses that have opened or hired more people. But business owners and managers are not required to report every change in employment to their local politicians, let alone tell them whether the politician’s favored policies have anything to do with it.
The Tax Foundation's annual study of state and local tax burdens compares one factor relevant to state economies, and recently ranked Michigan 25th among the states. Interestingly, Michigan also gets mediocre grades on indexes that look at other measures of states' economic competitiveness and performance.
We’ve all seen a bumper sticker that make us shake our head, and it’s hard to know the intentions of the person who put it on their car, and whether they were misinformed or simply uninformed. The one I spotted the other day, however, jumped out at me as particularly ignorant.
Mackinac Center research was recently featured in the national School Transportation News magazine.
In January, the magazine wrote about a new study by Michael LaFaive and James Hohman that compares the rates of privatization of noninstructional services in schools across five states. The survey examined the use of contractors for services including busing in Pennsylvania, Michigan, Ohio, Georgia and Texas.
By Jack McHugh
Update: On Feb. 3 the House Elections Committee voted to advance the problematic provisions described in this article to the full House for consideration. They pasted nearly identical provisions into House Bill 5219, which modifies but does not repeal the current 60 day pre-election ban on tax-funded electioneering communications. The committee then reported the revised text of HB 5219 to the full House.
Some argue that Michigan needs to become a more attractive place for college graduates in order to grow the state economy. But the past decade suggests that simply targeting people with college degrees is an ineffective strategy. The reason is that people move to places where there are employment opportunities, regardless of whether they have a college degree or not.
The Tax Foundation recently published its latest ranking of state and local tax burdens. The report placed Michigan in 25th place as of 2012.
This is a substantial improvement, but to make this state a growth and opportunity leader the Michigan Legislature needs to go further by rolling back the personal income tax rate, as was promised when it was increased in 2007.
