The Associated Press is reporting that a convicted embezzler
currently on parole has been approved for business tax credits under the
state's Michigan Economic Growth Authority program. The article also noted
that when the deal was announced, the embezzler, Richard A. Short, "shared the
stage" with Gov. Jennifer Granholm.
Had the program managers performed even a cursory background
check, they certainly would have discovered Short's past: Among other things,
he's listed on the State Police "offender tracking system," according to the
Google could have helped in the background check: The Flint
Journal mentioned Short in a February 2008 article — readily available on the
Internet — about how difficult it is for people convicted of a financial crime
to get credit, including credit cards.
According to the article:
The state parole board took away
Short's credit card privileges when he was released from prison in 2004
following a two-year stint after he pleaded no contest to embezzling $35,000
from a Muskegon battery manufacturer.
As a parole condition, Short was told
he could not have a checking account, a charge account or a credit card.
He later discovered those
prohibitions extended to debit cards and every other conceivable electronic
According to a 2001
AP story in the Ludington Daily News, Short had two prior fraud
convictions on his record before serving time for embezzlement.
Despite all this, he is apparently eligible to receive up to $9.1 million
in MEGA tax credits — and to do public relations work for Gov. Granholm.
What's more, these are probably "refundable" credits, meaning outright cash
subsidies, making them even more attractive to embezzlers. That this story
should break during "Sunshine Week" — a week devoted to calling for more open
government — adds to the irony.
As I told The Flint Journal, this is evidence that Michigan economic development programs need vastly more transparency.
MEGA is the same program that the Mackinac Center has twice
demonstrated (in 2005 and again in 2009) has not created net new jobs for
The Center has also exposed the agency's growing lack of
transparency during and after its deals are struck. A more open process might
prevent bad deals before they happen. However, the Mackinac Center's primary
concerns are tax breaks and subsidies handed out to individuals and firms who
are not convicted embezzlers. The program has offered up billions, yet it doesn't help the economy and has become aggressively less transparent over the years.
This may not be the last the public hears of state corporate
welfare deals involving questionable supplicants. There is so much money
sloshing around the Michigan film incentive subsidies, for instance, that
future scandals seem all but inevitable.
Permission to reprint this blog post in whole or in part is hereby granted, provided that the author (or authors) and the Mackinac Center for Public Policy are properly cited.