For Immediate Release
Thursday, Dec. 13, 2007
Contact: Michael D. LaFaive
Fiscal Policy Director
MIDLAND — Mackinac
Center Fiscal Policy Director Michael D. LaFaive today called on Michigan
policymakers to make transformational, market-friendly policy changes their top
New Year’s Resolution for 2008, warning that to do otherwise would all but
guarantee continued loss of jobs and population.
"We were already at or
near the bottom of many important economic rankings before the Legislature piled
on $1.4 billion in new taxes," said LaFaive. "Does anyone really believe this
hike will make Michigan more attractive to people and business?"
Indiana does not think
so. The state has posted billboards along interstates near the border
encouraging passers-by to come to Indiana if they’re tired of high taxes, and
high business and housing costs. Indiana is also running radio ads in Michigan
and Illinois with the same message — and may have a compelling reason to do so.
A new study by economists Arthur Laffer and Stephen Moore shows that record
numbers of Americans moved last year and they tended to move south and west — to
states with generally favorable tax and labor climates, among other things.
"People are everything
to economic growth," noted Center adjunct scholar Michael Hicks. "They produce,
they consume and they invest. As people move, they take their talents and energy
with them. Every time people move they reveal their relative preference for
In a new essay titled,
"Michigan’s Diaspora: A Revealed Preference for Leaving," LaFaive and Hicks
argue that state policy must change to make Michigan relatively more attractive.
If changes are not made, they wrote, the state may need to change its motto from
"If you seek a pleasant peninsula look about you," to "If you seek a pleasant
peninsula, move to Florida," which is where many Michigan residents are in fact
The authors cite the
latest United Van Lines data showing that through October, 66.4 percent of the
company’s 2007 Michigan client traffic was outbound. The all-time record was set
in 1981 at 66.9 percent, a year when the state averaged 12.5 percent
unemployment rate of 7.7 percent is highest in the nation, but that figure is
actually masked by our ability to export job seekers to states with greater
economic opportunity," said LaFaive.
The authors recommend
that Michigan become a right-to-work state, lower the regulatory burden and cut
taxes as ways to stem the flow of jobs, people and opportunities to other
The essay can be found