We’ve had long-standing opposition to the state taking money from everyone to give to select businesses. It’s unfair, inappropriate and it doesn’t grow the economy. Lawmakers, on the other hand, buy the excuses that it is necessary and important to continue subsidizing select businesses. After researching and tracking these developments for decades, we can now show just how much every lawmaker who has served since 2001 has approved in business subsidies.
Lawmakers have to pass public acts before the state can take money from some taxpayers and give it to others through business subsidy programs. So we assembled all the laws that did so since we began MichiganVotes.org, which provides plain language descriptions of every bill and amendment that goes through the state Legislature and shows how every legislator voted.
There were 71 laws that authorized $16 billion in subsidies since 2001, more than the value of the Lions, Tigers, Pistons and Red Wings combined. Some of those votes got to be messy, however, with authorizations for new subsidies wrapped up in bills that enacted major changes. A 2007 law, for instance, changed the structure of the state’s business tax, but it also extended a number of business subsidy programs. To get a clear sense of where each lawmaker stood on subsidies, we stripped the list down to just 37 bills that approved $6 billion in subsidies.
We found that support for subsidies was a bipartisan affair. The average Republican voted to approve $1.47 billion, while the average Democrat approved $1.62 billion. There was little opposition, as 43 percent of all lawmakers supported every subsidy that came up for a vote. Only 4 percent opposed every subsidy that was approved during their tenure.
Opposition to business handouts tends to be a recent phenomenon. That 4 percent is made of 22 lawmakers — 21 Republicans and one Democrat — and all of them were elected in 2008 or later.
Lawmakers are under immense pressure from the people who get the subsidies to pass these laws. Stories about job losses or businesses threatening to leave the state make headlines — and not favorable ones. A story about a promise of new jobs, by contrast, can be a feather in a lawmaker’s cap. But real growth doesn’t come from the handful of companies that are given taxpayer cash by state politicians. The bulk of job growth happens without subsidies.
The ineffectiveness of the subsidies, however, does not negate the political benefits from approving them. We hope this scorecard will help hold policymakers more accountable to their constituents when it comes to subsidizing favored businesses.
We’ve seen some evidence that it is having an effect. Lawmakers who have clean records on this scorecard are pointing it out, while lawmakers that don’t are being defensive about it.
That’s a good indicator our scorecard has some consequences, but it is not enough, by itself, to change lawmakers’ incentives. There has to be something that resonates with their constituents.
And that’s the point. Business subsidies have, unfortunately, been popular enough to get broad bipartisan support. But if we expose their problems, if we can change people’s minds about the issue and if we show them how their own representatives vote on this issue, there’s a chance that we can also change the policy.