Author’s Note: This was originally published Friday, March 20, in the Post Bulletin (see Postbulletin.com).
The Post Bulletin’s recent op-ed arguing for maintenance of the state’s existing automatic tax increase on cigarettes (Our View: Cigarette tax should be left alone, March 12, 2015) is misleading and shortsighted on several fronts.
The Detroit News and WLNS 6 News have reported on the deal between the Michigan Education Association and Lansing School District where the district pays Steve Cook’s $201,613 salary and $51,976 pension contribution, which is then reimbursed by the Michigan Education Association.
The Detroit Free Press wrote a follow-up article on a December story broken by Senior Investigative Analyst Anne Schieber. The original story was about two men who had thousands of dollars’ worth of property seized in raids of their homes, without being charged with a crime. Since the publishing of the story, both men have been arrested.
The Wall Street Journal cites Mackinac Center research by James Hohman, assistant director of fiscal policy, and Jarrett Skorup, digital engagement manager, in an article on the potential end of the Michigan film producer subsidies. The film incentives program, in its current form, costs taxpayers $50 million per year, or 2.5 million potholes that could have been filled.
(Editor’s Note: This article was originally published on March 18, 2015 by Center of the American Experiment.)
Minnesota has a large smuggling problem and it is set to get worse. We estimate that the 130 percent excise tax increase on cigarettes in July 2013 raised Minnesota’s smuggling rate to 33.7 percent of the total market from a much lower 18 percent. This hike in tax evasion and avoidance is a direct function of high excise taxes — which will likely increase each year — and the ease with which consumers can acquire lower priced cigarettes places like North Dakota, Indian Reservations and the Internet.
Mitch Albom’s March 14 defense of subsidies for film makers should inspire lawmakers to end this public policy mistake. Corporate welfare programs rarely produce net new jobs, especially in light of superior alternatives.
In order to subsidize the jobs of a few “carpenters and drivers,” among others, which Albom says resulted from the program, money must first be taken from many others. The net effect is at best a wash, most likely a loss.
An article in The Detroit News on FOIA law reform highlighted a current Mackinac Center Legal Foundation case. The lawsuit against the Michigan Liquor Control Commission disputes a $1,500 fee being charged for an electronic transfer of an already prepared file.
By Jack McHugh
Now with one click you can approve or disapprove of key votes by your legislators using the VoteSpotter smart phone app. Visit votespotter.com and download VoteSpotter today!
Senate Bill 72, Let landlords refuse rental for smoking medical marijuana: Passed 34 to 3 in the Senate
A Washington Examiner article quotes Director of Labor Policy F. Vincent Vernuccio on the subject of agency fees. In February, Illinois Gov. Bruce Rauner signed an executive order stopping the collection of union fees from the paychecks of public employees who have chosen not to be members of the union. Gov. Rauner’s decision was based in part on the Supreme Court’s ruling in Harris v. Quinn, which ended a dues skim from home healthcare workers in Illinois.
By Jack McHugh
On March 11, 2015, the Michigan House of Representatives voted 58‑51 to pull the plug on an “incentive” program that since 2008 has distributed some $500 million in state tax dollars to film-production companies.
According to the federal Bureau of Labor Statistics, Michigan had 1,663 full-time film-industry jobs in 2008, and 1,561 in 2013 (the latest year information is available), a decline of 102 jobs.
The Michigan House recently passed House Bill 4122 which would end the state’s film incentive program. The legislation now moves on to the Senate.
But Senate Majority Leader Arlan Meekhof, R-West Olive, has raised concerns about ending the subsidy. And Gov. Rick Snyder, who previously proposed eliminating the subsidies, now says he doesn’t believe ending the program abruptly is an “appropriate answer.”
The Washington Legislature appears again poised to go to the cigarette excise tax well. A proposal to hike the state’s excise tax by another 50 cents — to $3.52 per pack — would exacerbate an already large smuggling problem and offer little in the way of gains to public health.
In 2011, left-wing filmmaker Michael Moore sat on the advisory council for the Michigan Film Office. The office is in charge of determining what productions will receive the hundreds of millions of dollars that have been sent from state taxpayers to mostly out-of-state moviemakers since 2008.
Director of Fiscal Policy Michael LaFaive is quoted in Los Angeles Times on the subject of foreclosure in Detroit. According to the article, 62,000 Detroit property owners are facing foreclosure due to falling behind on the city’s high property taxes.
A recent Washington Times opinion piece by Director of Labor Policy Vincent Vernuccio and Brett Healy, president of the John K. Maclver Institute in Wisconsin, is cited in Forbes for supporting evidence for the benefits enjoyed by right-to-work states. On Monday, Wisconsin became the nation’s 25th right-to-work state.
Starting today, Taylor teachers are no longer constrained by a 10‑year union “security” agreement, and may opt-out of financially supporting the union if they wish. A request by the Taylor Federation of Teachers and the Taylor School District to place a hold on the ruling, pending the ruling’s appeal in court, has been denied.
By Jack McHugh
Now with one click you can approve or disapprove of key votes by your legislators using the VoteSpotter smart phone app. Visit votespotter.com and download VoteSpotter today!
Senate Bill 86, Authorize more local pension debt: Passed 38 to 0 in the Senate
Research conducted by Assistant Director of Fiscal Policy James Hohman appeared in the Wall Street Journal this week. The article, titled "The Right-to-Work Advantage," discusses the economic advantages and freedom-based benefits that lead states to adopt right-to-work policies. Hohman’s research found that “right-to-work states have 4.1 percent higher per-capita personal incomes than non-right-to-work states” once cost of living is factored in.
The House Tax Policy Committee voted 8-3 to end Michigan’s $50 million per year film incentive program. The vote passed House Bill 4122 out of committee and it is on to the full House.
The bill was supported by Rep. Jeff Farrington (R-Utica), Rep. David Maturen (R-Brady Twp.), Rep. Patrick Sommerville (R-New Boston), Rep. Ken Yonker (R-Caledonia), Rep. Martin Howrylak (R-Troy), Rep. Lee Chatfield (R-Levering), Rep. Gary Glenn (R-Midland), and Rep. Brandt Iden (R-Portage). It was opposed by Rep. Jim Townsend (D-Royal Oak), Rep. Bill LaVoy (D-Monroe), and Rep. Wendell Byrd (D-Detroit).
Vice President for Legal Affairs Patrick Wright was a guest on the “The Frank Beckman Show” of WJR Radio to discuss the Mackinac Center’s investigation of the MEA President Steve Cook’s pension. Steve Cook appears to be earning a taxpayer-funded pension as an “employee” of the Lansing School District, despite not performing any duties under the school district.
Director of Labor Policy Vincent Vernuccio and Brett Healy, president of the John K. Maclver Institute in Wisconsin, coauthored an opinion piece that appeared in The Washington Times. The authors discuss the effects stemming from right-to-work passage in Michigan and Indiana.
By Jack McHugh
Senate Bill 71, Extend, expand job training subsidies to some employers: Passed 37 to 0 in the Senate
To eliminate the $50 million debt cap in a 2008 law that authorized state job training subsidies for particular employers, provided through community colleges. Other bills in the package would make this program permanent, and prohibit companies granted subsidies under a different program (see next bill) from “double dipping” by taking subsidies from both programs.
Assistant Director of Fiscal Policy James Hohman is quoted by the Detroit Free Press, Grand Rapids Press, Lansing State Journal, Livingston Daily, WLNS, and HometownLife.com on the ineffectiveness of Michigan’s film incentive program. The House Tax Policy committee continues to debate a bill that would repeal the film incentive program.
(The following is a transcript of the testimony given by Michael LaFaive, director of the Morey Fiscal Policy Initiative at the Mackinac Center for Public Policy, on February 26, 2015, in front of a Minnesota Senate Tax Committee.)
Good morning. My name is Michael LaFaive and I am director of fiscal policy for the Michigan-based think tank, Mackinac Center for Public Policy. I was invited to speak today by the Minnesota Wholesale Marketers, Grocers and Retailers Associations, respectively.
The Mercatus Center at George Mason University has a new working paper looking at the effects of occupational licensure in the area of opticians. The results show the problems of state licensing in a variety of areas.
From 1950 to today, it is estimated that the percent of occupations now requiring a license has risen from five percent to 30 percent. In other words, the percent of occupations which require people to pay a fee to the state or take mandated classes has risen six-fold. According to Dr. Morris Kleiner of the University of Minnesota, most of this licensing drives up costs for consumers but does not lead to better health and safety results.
