Some Michigan lawmakers pushed for more business subsidies at the end of 2025 but were unsuccessful. They are likely to try again in 2026. Lawmakers should start the debate with a healthy skepticism about their ability to drive economic outcomes. And there’s a way to focus the debate.

What lawmakers seem to have agreed upon is that they will not make deals for large cash payments as companies build their offices and factories and then hope that the buildings meet job expectations later. That was the structure of the SOAR program, which has paid out $720 million so far but has not created any jobs, according to the latest state report.

A Senate committee heard testimony on another proposal. The bills would let select companies receive checks from the state based on how much they withhold from employees’ paychecks for state income tax purposes.

This is the same setup as the Good Jobs for Michigan program, which operated from 2017 to 2019. It made only six deals to create 9,454 jobs, and only produced 511 jobs, according to the latest state report. So, if lawmakers want to bring it back under a new name, they must have some reason other than its record.

Bills introduced in the House would have different features than those offered by the Good Jobs program. They would create a by-right tax that credit companies could claim when they create jobs that pay well above regional averages. That is, employers would not have to seek out a contract with the state government; they could simply claim the credit when filing taxes with the Treasury Department.

Credits under the new House bills would be nonrefundable, meaning that recipients would not receive cash paid for by other taxpayers. Recipients would receive, at most, the privilege of not paying the business’s state income taxes.

There are big differences between the Senate and House proposals, but they both share a common trait. They call for economic development programs that are not required to develop the economy. That is, the proposals are intended to improve the state’s economic performance but are not tied to it. They lack measurable goals and accountability.

There are reasons to believe that the selective subsidies and tax credits for job creation will not improve the state’s economic performance. Many economists who use sophisticated methods to isolate the effects of the programs find that the policies regularly fail to deliver what lawmakers intend.

Lawmakers are sincere in their belief that tax capture programs (the Senate proposal) and tax credits (the House proposal) will improve Michigan’s economic outcomes. They should reexamine the evidence. And if they want to continue, they ought to at least include a goal for what they want to accomplish.

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