[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.

MEDC Untruths Reveal Political Nature of 'Jobs' Department

The Mackinac Center's recent analysis of the Michigan Economic Development Corp. elicited some misleading or erroneous responses from MEDC officials. Although the MEDC is supposed to be about economic development, its true mission is political, and so its pronouncements should be viewed with the same skepticism as ones from politicians. … more

Dancing With the Government

When you "dance with government," be prepared to get stepped on. … more

MEGA Stories

Michigan Economic Development Corporation CEO Greg Main boasted that he "would invite (critics) to take a look at the results (of the MEGA targeted tax break program)." We did. Twice. In depth and detail. We found that - at best - MEGA creates no new jobs, and on balance it may even destroy them on a net basis. Further, only 29 percent of the direct jobs promised by its deals ever happened. To date, the MEDC has not refuted a single point of fact, or produced independent, systematic evidence that its approach does squat to create jobs, increase state incomes or expand our economy. … more

"Slashing" Economic Development Staff? Please Sir, Can We Have Some More?

The Michigan Economic Development Corporation — the lead agency in a statewide "economic development" empire — is arguably the most ineffective, least necessary department in state government. Shrinkage of the agency's staff is good news; staff levels reaching zero would be excellent news! Alas, declines reported by a recent Detroit News article aren't quite what they appear to be. … more

Jobs Braggadocio

The Granholm Administration wasted no time after the Michigan Economic Growth Authority monthly rubber-stamp board meeting on Tuesday to start pumping out press releases bragging that more than 2,800 new jobs were coming to Michigan as a result of selective tax break deals for the latest gaggle of "winner" firms and projects. The MEGA-related jobs claims should be discounted by 71 percent, based on a recent Mackinac Center study that found only 29 percent of the jobs promised by past MEGA deals actually happened. … more

How Big Is Michigan's Government, Really?

The Detroit News on Saturday published an article in which reporter Ron French compiled various indicators to suggest that Michigan state government is smaller now than at the start of this decade (“Michigan’s shrinking government”). Actually, gross state spending during this decade rose a modest 3.4 percent after adjusting for inflation, while the state's economy shrunk by 3.3 percent. … more

Is it The Wall Street Journal or The Onion?

This week, The Wall Street Journal published another critical examination of Michigan's political leadership, economy and budget. In a delicious irony, the online version posted a Michigan Economic Development Corp. advertisement featuring actor Jeff Daniels alongside the piece. … more

Mississippi Not Burning

Gov. Jennifer Granholm took a gratuitous swipe at the state of Mississippi. The Mackinac Center takes a nuanced look at the Magnolia State's fortunes. … more

How to Fix Michigan? Cut Cost of Living, Working and Investing Here

On Oct. 9, 2009, Michael LaFaive, director of the Mackinac Center's Morey Fiscal Policy Initiative, spoke at the invitation of Rep. Justin Amash, R-Kentwood, at an "Economic Town Hall" meeting convened by the representative. Here's what he told the participants: When I was first asked to participate here I was a bit taken back by the specificity of Representative Amash's request. He said, "Mike, my constituents have endured nearly a decade of bad news. I want you to tell them what we're doing right. Give them the good news." So, in conclusion let me say ...Obviously, I am joking but at the same time, I am not joking. … more

Come Fly With Me: Will Detroit City Airport Get Dose of Fiscal Sanity?

Detroit Mayor Dave Bing has recommended outsourcing the management of the Coleman A. Young International Airport to save money, as recommended by the Mackinac Center back in 1998. When we did so the city had recently provided the airport with a $1.9 million subsidy. In 2007 (the latest year for which data is available), the subsidy was down to $900,000, but the city's ability to afford any subsidy has collapsed altogether. At this point, the city should investigate just completely unloading the airport with an outright sale. … more

A Rebuttal to the MEDC's Wall Street Journal Letter Part III

Yesterday, I published the second part of this essay, which uses an MEDC letter-to-the-editor in the Wall Street Journal to illustrate the agency's pattern of using illegitimate rhetorical devices in response to serious critiques, including distractions, irrelevancies and non sequiturs. Part I was published Wednesday. Here's third and final part: … more

The Coming $50 Billion Budget Battle

The state is currently wrestling with how to close a $2.8 billion budget deficit for fiscal year 2010. Some of the proposed cuts to state spending are significant and debate over them may be holding up completion of the budget, which must be passed by midnight Sept. 30 to avoid a government shutdown. … more

Tourism Subsidy Beneficiaries Chant on Capitol Steps: "Gimme! Gimme! Gimme!"

Actually we don't know what they chanted, but MIRS News reported that that tourism-related business officials did demonstrate in front of the Capitol yesteray, protesting a proposed cut to the state's "Pure Michigan" advertising campaign.Here's a concept for them: If ad campaigns like Pure Michigan are really such a success, why don't the hotels that benefit from this taxpayer largesse pay for it themselves? That the tourist industry's members refuse to do so speaks volumes about the program's real value. … more

A Rebuttal to the MEDC's Wall Street Journal Letter Part II

Yesterday, I published the first part of this essay illustrating how an MEDC letter-to-the-editor responding to a critical Wall Street Journal editorial illustrates the agency's pattern of using illegitimate rhetorical devices to avoid responding to the substance of serious critiques, including distractions, irrelevancies and non sequiturs. Here is the second part of the essay, deconstructing other statements in MEDC CEO Greg Main's letter. … more

A Rebuttal to MEDC Letter in The Wall Street Journal

On Sept. 4, The Wall Street Journal published an editorial titled “The Michigan Example,” excoriating the state’s reliance on government central planning to “create” jobs, rather than undertake genuine overall business climate reform. The editorial was based in part on research published a few days earlier by myself and James Hohman. … more

Michigan Sets Another Dubious Record

Data released last Friday by the federal Bureau of Labor Statistics showed that for the second month this year, Michigan was burdened with an unemployment rate exceeding that of Puerto Rico. Michigan’s rate was 15.2 percent while Puerto Rico’s stood at 15.1 percent. … more

Green Jobs Fad Means More Government Intervention

The Michigan Economic Development Corp., state Legislature, governor and other supporters of government “jobs” programs have adopted an almost pop-culture idolatry for all things environmental by showering taxpayer subsidies upon corporations claiming to bring purportedly “earth friendly” products to market. It has a shiny, new green paint job, but in fact this is just the latest in a long line of failed state economic development program fads. … more

Trick, or Treat

The Michigan Legislature is this morning taking up House Bill 5275, a bill that authorizes a Michigan Economic Growth Authority business tax credit deal for a battery cell manufacturing facility. … more