A Mackinac Center Analyst Offers Policy Ideas for Michigan (2:39)

Michael D. LaFaive's "2009 State of the State Address": A Video Summary

(Click here for "101 Recommendations to Revitalize Michigan")

Michigan Gov. Jennifer Granholm this week gives her annual State of the State Address. These addresses typically contain memorable phrases — in 2008, “a job for every Michigan worker”; in 2007, “going anywhere and doing anything to create jobs.”

But in recent years, policymakers’ sound bites have often been more memorable than their results.

That’s why Mackinac Center Fiscal Policy Director Michael LaFaive temporarily claimed a new role and gave his own “State of the State Address” Jan. 24, announcing, “It’s a year later, and I stand before you again.”

He told a crowd of nearly 300 at Macomb Community College that instead of making the state attractive to entrepreneurs, investors and job providers, Michigan lawmakers have been moving in the opposite direction.

“In 2008, against my wishes,” he said, “you [lawmakers] decreased competition in the electricity and natural gas markets by effectively regranting monopoly privileges to big incumbent utilities. You imposed expensive renewable energy mandates on utilities and authorized them to tack extra charges onto consumer bills to pay for it. … You passed new, complex groundwater withdrawal regulations on industrial and commercial users, diminishing one of the few comparative advantages that Michigan actually has with the rest of the nation. … You went from granting targeted tax breaks to privileged special interests and large corporations to handing out massive cash subsidies like candy on Halloween to the ‘sexy’ industries.”

LaFaive also expressed concern that truly representative government has been compromised in Michigan, telling the audience: “The result of this is to create a new class warfare, in my opinion. I call it ‘the people versus the political class.’ ”

LaFaive then outlined ways to return to the people some of the power and resources that have been assumed by the state, enumerating: “One: a ‘taxpayer bill of rights.’ This is the holy grail of state economic reform, in my view. … [Two:] Adopt a constitutional amendment requiring a supermajority in the Legislature or voter approval of any tax increase. … [Three:] a part-time legislature. … [Four:] Repeal the Michigan Business Tax and replace it with nothing.”

And while recognizing the challenges Michigan faces, LaFaive struck an optimistic note, saying, “Once pro-growth and freedom-friendly policies are in place, recovery is likely to occur far more quickly than people imagine.”