[Photo of Michael D. LaFaive]

Michael D. LaFaive

Director of the Morey Fiscal Policy Initiative

Michael LaFaive is director of the Morey Fiscal Policy Initiative for the Mackinac Center for Public Policy, where he has worked since 1995.

He is the author or co-author of hundreds of essays, commentaries and blog posts and 12 studies on fiscal policy topics as varied as local and state privatization efforts, corporate welfare, school finance, state budgeting and cigarette taxes.

Among his studies is the Mackinac Center for Public Policy’s largest, a nearly 200-page state budget analysis that recommended more than 200 ideas for trimming some $2 billion from the state budget without cutting Medicaid or School Aid funding. Many ideas first presented by LaFaive in 2003 have been adopted or adapted by lawmakers in Lansing.

He is also the originator of the Center’s annual school privatization survey, which routinely garners a 100 percent response rates from districts. There is no database of competitive contracting like it in the United States. In addition to this product, LaFaive authored in 2001 a 26-page, full-color edition of Michigan Privatization Report specifically dedicated to fixing Detroit. The ideas in that publication are more relevant today than when it was published.

LaFaive is perhaps best known, however, for his cutting-edge, scholarly work examining state “economic development” programs. His studies and frequent commentaries on this topic have garnered him a national, if not international reputation as a respected government development critic and were probably influential in the decision to kill the Michigan Economic Growth Authority, the state’s high-profile corporate welfare program. 

LaFaive has been interviewed more than 1,300 times by the media in the last ten years. He is typically interviewed more than 125 times a year by members of the press seeking comment on fiscal issues and remains a popular public speaker.

He has undergraduate and graduate degrees in economics from Central Michigan University.

LaFaive is married and resides in Midland, MI.

Remembering Vincent Chin

Death at the hands of laid-off autoworkers 30 years ago today. … more

Legislature Should Be Bold on Tax Cuts

Difference should be made up with spending cuts only. … more

Million-Dollar Beer Babies

State Lawmakers Invite a Local Emergency Manager by Disregarding Michigan’s History

Retail Alcohol Density and Public Safety

Scholarly evidence shows no negative connection. … more

Lansing Builds a 'Scaffolding for Plunder'

House Bill 5667 has several flaws … more

The Longest Yard

Prison guards defeat taxpayers in privatization battle. … more

Alcohol Control Reform and Public Health and Safety

Michigan regulates the sale of beer, wine and “spirituous” (hard) liquor through state statute and rules promulgated by the Michigan Liquor Control Commission. As part of this system, state government intervenes in the spirituous liquor market as a monopoly wholesaler, a role it has filled since the end of Prohibition. The state also mandates that most suppliers of beer and wine grant exclusive sales territories to a select group of wholesalers. These and other restrictions artificially raise prices and reduce the availability of alcohol to Michigan’s consumers.

Last year, a state Liquor Control Advisory Rules Committee was charged with developing alcohol control reform proposals. Some critics, however, have cautioned that the state’s present alcohol laws are necessary to protect public health. This Policy Brief examines the health and safety effects of alcohol regulations like Michigan’s. … more

Flashy Projects Flash Back

It didn't have to come to this for Detroit. … more

Pontiac's Fiscal Revolution

Emegency manager taking steps to rescue city. … more

Breaking News!

Michigan advances to 17th on economic outlook index. … more

Time to Scotch Michigan’s Wholesale Alcohol Monopolies

Prohibition by Price

Research Shows Right-to-Work Laws the Right Way to Go

How Corporate Welfare Hurts People

If the Monopoly Title Fits, Wear It

Alcohol distribution territorial monopolies hurt consumers. … more

'Birthday Tax' Unveiled in Lansing

New taxes, fees for road maintenance. … more

Commentary: Right-to-Work Will Keep Michigan Competitive

Bay City Repeals Prevailing Wage Ordinance

Other cities, state should follow suit. … more

Taxpayers Fund Bureaucratic Back Slapping

Over-sized checks wasteful, opportunistic. … more

Bay City Amends Prevailing Wage Ordinance

State, cities should abandon "archaic practice." … more

State Alcohol Control Law Expensive, Unfair, Ineffective

Surplus, or Excess?

More state revenue could mean more spending. … more

Michigan's Migration Status Improves

United Van Lines 2011 study released. … more

Right-to-Work Legislation Possible in Indiana

"Significant economic consequences for Michigan." … more

Mich. 'Green Jobs' Subsidy Winner Evicted from Saginaw Headquarters

Happy 96th Birthday, Dr. McCracken!

Best wishes from the Mackinac Center to an economic supernova. … more

Breaking News: Michigan Loses Population Again

Michigan citizens fleeing the Great Lake State. … more

Hand Wringing Over Liquor Reforms

Claims don't mesh with scholarly literature. … more

Commentary: Meet the New MEDC, Same as the Old MEDC

Analysis: State Alcohol Control Law Expensive, Unfair, Ineffective

State of the State: How to Move Michigan Forward

Eight Ideas for Reforming Alcohol Control in Michigan

Gov. Snyder's Second State of the State

Some suggestions on what he should address. … more

Detroit Exhausts Its Options

City needs to take bold steps to avoid bankruptcy. … more

Commentary: Recommendations for Gov. Snyder’s Liquor Control Advisory Rules Committee

From the Department of You Can't Be Serious ...

MSU gets federal grant to study economic development subsidies. … more

Liquored Up: Michigan Government Should Exit Its Liquor Wholesale Business

Letter in Freep is Spurious, Misleading

Response on beer and wine wholesaler monopoly easily rebutted. … more

Alcohol Wholesalers Squeeze Consumers Dry

Migration and Tax Rates

More evidence for the relationship between high tax burdens and people showing their preference by voting with their feet. … more

Read All About It

State laws redistribute wealth to beer and wine distributors. … more

Taxes and the Life and Death of Great American Cities

Low-tax metropolitan areas experience much greater growth than high-tax ones. … more

State Regulations Suffocate Hospitality Industry

Rep. Doug Geiss (D-Taylor) wants to ease some of the regulatory burdens on Michigan’s hospitality industry. … more

Another MEGA Loser

In the latest government economic development failure in Michigan, Evergreen Solar files for bankruptcy. … more

Liquor Panel Formalized

Time to change liquor laws to finally favor consumers. … more

Five Questions for New Liquor Advisory Committee

Commentary: Rethink Michigan's Liquor Distribution System

Commentary: Michigan Liquor Control Code Too Controlling

Beer and Wine Wholesalers Deliver Themselves Regulatory Privileges

Run From the Border(s)

One of MEGA's first "winners" ends up a loser.  … more

State Pours Interference on Liquor Business

Commentary: Five Questions for New Liquor Advisory Committee

Michigan State Senator Offers Cigarette Tax Cut to Cut Smuggling

Lowering the cigarette tax would reduce smuggling and smuggling-related violence. … more

Distilling the Truth

Beer and wine monopoly "valiant" in fight against competition. … more

Commentary: State Pours Interference on Liquor Business

Pontiac Should Have Listened to Center Experts

Will Detroit pay attention to Pontiac's example? … more

Some Good GDP News for Michigan

Michigan’s 2009-2010 state GDP growth rate was 2.9 percent, its best since 2002. … more

Stage Doors and Broken Windows

The Benefits of Prison Spending Reform

Film Incentive Drama May Upset Reforms

Film Incentive Drama May Upset Reforms

The Good, Bad and Ugly of Gov. Snyder’s First Budget

Good, Bad and Ugly of Gov. Snyder's Budget

Gov. Rick Snyder’s first budget fell short of the “atomic bomb” promised by Lt. Gov. Brian Calley, in part due to the fact that a megaton of further spending and tax cuts were left on the table. Overall, the budget moves the state in a positive direction with greater tax simplicity, more transparency, less corporate welfare and fewer discriminatory tax policies.  … more

Eliminate the Michigan Business Tax

Cigarette Taxes Fuel Rampant Smuggling

Extending Exemptions

Michigan currently provides a 100 percent income tax exemption for government retirement benefits, but the exemption is capped for benefits earned by retirees who worked in the private sector. … more

Gov. Snyder to Break Michigan's MEGA Habit

Although details are not yet clear, according to early reports Gov. Rick Snyder’s proposed Michigan Business Tax replacement appears to be good news for advocates of sound economic policy. … more

'Book Him!': Michigan Film Subsidy Scandal Leads to More Charges

A scandal first exposed by the Mackinac Center last June has led to a second set of felony fraud charges. … more

Four Cheers for Gov. Snyder

The first three weeks of Gov. Snyder’s administration has provided plenty to cheer, especially on fiscal policy issues. … more

Gov. Granholm Leaves Michigan to Find Work

Today is the 5th anniversary of Gov. Jennifer Granholm’s promise that Michigan residents would be “blown away” by the gobs of jobs her latest economic development program would create. How ironic then that she of all people would flee the state to find work… more

Projection: Repealing MBT and Surcharge Creates 120,000-plus Jobs

The first bill introduced in the Michigan House this year would repeal the much-reviled Michigan Business Tax 22 percent “surcharge,” and the first Senate bill would repeal the MBT altogether. Gov. Rick Snyder has proposed replacing the tax with a 6 percent corporate income tax, a change that would mean a big net tax cut for job providers. … more

GR Press Editorial Correct on Muni Spending

Applause is in order for the Grand Rapids Press Jan. 5 editorial “How to save money for local governments,” which correctly concludes that removing barriers to freer association between local units of government can cut costs. … more

Past State of the State Speeches Show Wide Variation in Proposed Government Expansions/Contractions

The Mackinac Center has tallied proposed expansions and limitations in each Michigan State of the State address since 1969. While not perfectly scientific, the exercise may provide some insight into an administration’s mindset. What do the past speeches tell us? … more

Sympathy for Politicians, Staff

As significant and real reforms and spending cuts are being discussed in Lansing, it’s hard not to feel a touch of sympathy for the “constituent services” staffers employed by lawmakers, and even for some of their politician bosses. … more

MBT Surcharge Repeal Could Create 27,900 New Jobs Through 2016

It’s probably no coincidence that the first bill (HB 4001) introduced in Michigan’s new Legislature is to repeal the 21.99 percent surcharge slapped onto the Michigan Business Tax in 2007. The surcharge is despised by the business community, and is seen as a job killer by policy analysts and politicians alike.  … more

Are Corrections Costs a Mystery?

A story in the Jan. 10 edition of the MIRS Capitol Capsule reports that, according to the National Institute of Corrections, Michigan spends more than $5,200 more to lock up a prisoner for a year than the national average. Also, nearly 29 percent of the state workforce is employed by the Department of Corrections, and it will absorb 23.1 percent of the current year’s general fund budget. This is hardly new information.
Not surprisingly, Gov. Rick Snyder and others are looking to lower those costs. … more

Michigan's Budget Problems Bigger Than You Think

Early indications are that our new governor is acting boldly and wisely in his attempt to right size Michigan’s fiscal ship. That’s good news, and he should be applauded, in part due to the fact that he will need the moral support. Why? The budget is in worse shape than even he and members of the media have probably fathomed. I’m not the first budget analyst to notice this, but I may be the first to say it out loud.  … more

Motor City Finance: Then and Now

Ten years ago this month the Mackinac Center mailed a special, 28-page, full-color, Detroit-specific edition of Michigan Privatization Report to editors across Michigan. We had recently completed a comprehensive review of the city’s budget, and were deeply concerned by what it revealed.  … more

We're No. 2!

In still-bad-but-not-worst-possible news, for 2010 — the first time since 2005 — another state (New Jersey) has beat out Michigan in the annual United Van Lines ranking of state outbound migration. … more

State Should Reform Public Act 72 of 1990

State Should Reform PA 72 of 1990

Michigan’s local governments face fiscal challenges in 2011. The state already has a pretty good policy in dealing with its local units as their finances are stressed, but this policy should be improved in a few ways so that local governments continue to be solvent as taxable property values fall and spending pressures increase. … more

Saginaw Fails to Repeal Prevailing Wage

Saginaw County officials have quietly buried a previously scheduled vote to repeal its “prevailing wage” ordinance for construction projects costing more than $50,000. Prevailing wage laws prohibit granting a government contract to the lowest bidder unless the company pays above-market, “union-scale” wages. … more

Scheduled Saginaw Prevailing Wage Repeal Vote Quietly Killed

Gov. Snyder Should Adopt HSAs for Government Employees

Cigarette Taxes and Smuggling 2010

Fieldstone Golf Course Should Be Sold

In a time of increasing pressure on local budgets, municipal managers should reach first for the lowest hanging fruit on the savings-tree: government golf courses. Let the slicing begin. … more

Tear Down This 'Film Industry' Facade

Ending the handouts would send a signal that this state is done playing games with ephemeral and failed "economic development" programs, and instead will focus on a real economic growth agenda, including across-the-board tax relief, labor law changes and other regulatory reforms. … more

MEGA “GlobalWatt” Deal Raises Questions

Pontiac Contracts With Oakland County Sheriff for Police Services

By contracting with the county to provide police services, the city of Pontiac will get a step closer to fiscal solvency. … more

Analysis: State of Embarrassment