When policymakers want to paper over problems and avoid difficult issues, they will often pull out a distraction. That’s what we’re seeing with a new advertising campaign from the state of Michigan.
The media portray this campaign as a pitch for people with so-called blue state preferences, with Michigan advertising new policies from its Democratic-controlled Legislature. “The message from MEDC is clear,” one media outlet wrote. “If you value diversity and reproductive freedom, Michigan may be the state for you.”
The ad campaign vaguely highlights some social policy differences between Michigan and six targeted states: South Carolina, Florida, Indiana, Texas, Georgia and Tennessee. It is true that public policies can have an impact on population growth. But there is no evidence that the policies Michigan put in place this year can by themselves make a difference to something as complex as state-level population growth.
Michigan has long struggled with population, with only minor growth for most of the past 50 years. Since 2010, there has been very slight growth, about 1.6%, and that’s an improvement over the population decline of the early 2000s. More recently, the state has lost population the past two years. The other states have seen substantial growth: South Carolina (+14%), Florida (+18%), Indiana (+5%), Texas (+19%), Georgia (+12%) and Tennessee (+11%).
There’s something audacious about Michigan advertising its virtues to people in states with robust population growth. It’s like being behind on the scoreboard but insisting you’re winning because of how well you're playing.
If the state is interested in attracting more people, it should be learning from the very states it is trying to lure people from. What areas, then, should Michigan try to replicate?
Five of the six states have better land use laws than Michigan (with the other essentially the same), such as less strict zoning rules. Allowing people to develop land and put it to productive use will lead to more options for housing and lower costs. It also lowers the costs of starting and expanding a business.
Three of the states Michigan is advertising in (Florida, Texas and Tennessee) have no income tax, while its own rate is more than 4%, with the governor trying to increase it for next year. Indiana and Florida have lower property tax rates than Michigan. In fact, Michigan has higher property taxes than the three states that share a land border with it. All of them have competitive tax rates across the board.
Electricity costs are less expensive in the six states where Michigan is advertising. They fall between 9.14 to 10.67 cents per kilowatt-hour. Michigan’s average price is at least 20% higher, at 12.93 cents/kWh. And it isn’t just because of the weather; Michigan has 25% higher electricity prices than neighboring Indiana. There’s little sign Michigan lawmakers have even considered breaking up the energy monopoly and letting residents choose their own supplier.
If government spending helps attract people to a state, you sure can’t see it in the data. Michigan spends $6,800 per person, more than any of the six states. Georgia, with 10.9 million residents, is the closest of the six to Michigan in size, with 10 million people. Yet Michigan’s total state budget ($80.5 billion) is $25 billion more than Georgia’s ($55.4 billion). It is unlikely that Michigan residents are seeing government services nearly 50% better than those provided to Georgia residents.
Family, weather and natural resources are big determinants of where people live and move, and there isn’t much policymakers can do about that. Social policies may influence some people, but economic factors like job availability and cost of living are the key factors that state policymakers have a say over.
If Michigan wants to compete with fast-growth states, it needs a growth mindset. Most growth states have lower taxes, cheaper energy costs, better housing supply and less government spending. Lawmakers should focus more on those things than on wishful advertising campaigns.
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