President Obama was in Michigan last week to sign a 10-year, $1 trillion farm bill. While much of the debate has centered around the spending on food stamps, buried in the 1,000-page plan are many other provisions that are indefensibly bad policy.
While some are praising, and others complaining, about slightly rolling back spending on food stamps and eliminating some of the direct payments to "farmers" (who did not actually farm), the bill goes far beyond that. This bill continues special subsidy deals to farmers in every area in the country — from corn and beans to rice and peanuts to sugar and catfish.
Senate Bill 475, Establish trampoline court regulations & immunities: Passed 25 to 12 in the Senate
To establish standards and regulations for recreational trampoline court facilities and operators, and grant these businesses limited immunity from lawsuits if the proposed regulations are followed.
Michigan's school employee pension system is underfunded by $23 billion and to return it to full funding, it is necessary to continue to pay the system's annual required contribution.
The annual required contribution is the amount necessary to pay for the pensions that employees earn and to catch up on unfunded liabilities under the state's assumptions. The state has not been paying the full amounts.
The Mackinac Center is pleased to announce that three new economics professors have agreed to join our Board of Scholars. Our Board of Scholars members assist us in our research, helping us produce studies that are of the highest quality.
Chris Douglas is an economics professor at UM-Flint. He authored a 2011 Mackinac Center study, and has published in Oxford Review of Economic Policy, Journal of Economics, and Journal of Applied Econometrics, among others. Douglas's research interests include gasoline markets, smoking externalities and the economics of sports.
Mark Schauer, Democratic candidate for governor, is railing against tax breaks for businesses.
In a recent ad Schauer alleges that Gov. Rick Snyder cut education spending and used the revenue "to give tax breaks to businesses even if they send jobs overseas." Schauer's spokesperson, Zack Pohl, reiterated the claim in a recent Detroit Free Press article: "Snyder chose not to find new revenue for education because he used that money to pay for his huge $1.8 billion corporate tax break." The media has recently given more scrutiny to this narrative.
(Editor’s note: This is an edited version of testimony provided by Mackinac Center Senior Economist David Littmann to the Senate Finance Committee regarding Senate Bill 402.)
While Michigan is doing better, it should have been capitalizing far more on the past two years of national economic expansion. After all, the unusually low financing rates that have served as a catalyst for impressive improvements in auto industry sales, employment and profitability are unlikely to remain this favorable for another full calendar year.
Paul Egan of the Detroit Free Press had a good story Sunday covering the argument about education funding in Michigan.
The story is worth reading in its entirety, but some parts in particular stick out and reiterate work done by Michigan Capitol Confidential and deserve to be reposted with comment.
Research Associate Jarrett Skorup was a guest recently on “West Michigan Week,” a public affairs show produced by Grand Valley State University public television, discussing the minimum wage.
Noted by the promo to the show:
“[Y]ou can decrease the money floating around from that standpoint and [people] lose their jobs which is one of the consequences,” explains Jarrett Skorup with the Mackinac Center for Public Policy whose concern is a jump in minimum wage would do more harm than good.
Senate Bill 273: Impose licensure on "psychological associates": Passed 34 to 3 in the Senate
To impose licensure and regulation on "psychological associates," with license fees, continuing education mandates, a mandate to have accumulated 6,000 hours of experience prior to being eligible for a license, and other requirements imposed on potential new entrants to this profession by a board of existing practitioners.
According to a news release from the Bureau of Labor Statistics, Michigan's economy lost 200,728 private-sector jobs between April and June 2013, a figure equal to 5.8 percent of the state's entire workforce.
On its face, this job loss rate would mean not a single private-sector job will be left in Michigan by 2019.
A recent USA Today article highlighted President Obama visiting a Costco store where he repeated his call for an increase in the minimum wage.
The president chose the location because the average wage for the wholesale warehouse chain is $21 per hour and reports indicate that most employees start around $17 per hour.
Labor Policy Director F. Vincent Vernuccio writes in the Springfield (Mo.) News-Leader about the benefits a right-to-work law would bring to Missouri. He testified on the same subject before a committee of the Missouri Legislature earlier this month.
Michael LaFaive, director of the Morey Fiscal Policy Initiative, writes in today’s Oakland Press that Detroit should look to Pontiac for examples of how to reduce its debt.
Under an emergency manager, Pontiac reduced spending by 43 percent between 2008 and 2013. The steps the city took included selling off unnecessary assets (such as a parking garage and a theater) and contracting for public safety services.
A Michigan Senate committee today approved Senate Bill 402, which would start to undo an 11.5 percent income tax hike enacted in 2007 under Gov. Jennifer Granholm that the Legislature promised to roll back by 0.1 percentage points a year but failed to begin doing so as promised in 2013.
Nearly 6,000 independently organized events are being held across the country to celebrate National School Choice Week. This week is not about one particular form of school choice, but rather about celebrating the fact that parents and students have more educational options than ever before.
Last month, I wrote an op-ed that argued against state subsidies for Amtrak. In that piece, I estimated that this year Michigan taxpayers will give Amtrak passengers at least $49.51 (and maybe as high as $98.11) per roundtrip. The Michigan Department of Transportation took issue with these figures, and claims that the real subsidy cost is only $29.94 per passenger.
In a presentation for the Institute For Public Policy and Social Research, Michigan State University Professor Charles Ballard argues that more state funding for higher education is a must.
But the main evidence presented does not show his case.
One of Ballard's points is that having a degree is more important than ever, given the decline in manufacturing jobs. Thus, Michigan policymakers should direct more tax money to universities, reversing the decline in direct appropriations in recent years.
Fiscal Policy Director Michael LaFaive explained in The Grand Rapids Press today that a hike in the minimum wage would do more harm than good.
“Economically, it’s a very harmful policy that hurts more people than it helps and particularly the poorest among the lowest income, because owners can’t just eat the cost of this increase in the mandated minimum, so they’re going to choose the most productive among their existing employees to keep,” he said.
By Jack McHugh
A Detroit News editorial weighs in with a favorable opinion of a proposed Detroit "Business Improvement Zone" tax, which it denies is a tax and reports will sustain an existing downtown cleanup campaign funded by some property owners.
But it's not hard to see why these so-called "BIZ assessments" are unfair and bad public policy.
Senate Bill 337: Revise business tax collection procedures and deadlines: Passed 36 to 0 in the Senate
To establish limits on the personal liability of a business owner or manager for taxes the firm collects from another person but then fails to pay to the state. Also, to require the Department of Treasury confirm a business's known tax liability for a purchaser within 60 days if the owner requests this, and establish limits on a buyer's liability for unpaid taxes. Also, to require the department to complete audits and "clear" a taxpayer within specified time limits. Finally, the bill would establish that if a tax overpayment refund claim is not approved within one year it can be considered denied, which lets the taxpayer appeal to the state tax tribunal or court of claims. Note: After Gov. Rick Snyder vetoed Senate Bill 64 due to department objections to some details, that bill's other provisions were folded into this one. Both measures respond to complaints from the business community that the department is being overly and unreasonably aggressive in enforcing various business-related tax provisions.
(Editor’s note: This commentary originally appeared at www.burtfolsom.com on Jan. 21. Folsom, a professor at Hillsdale College, is the Mackinac Center for Public Policy’s senior fellow in economic education.)
The subject of "equality" is the source of much political debate these days.
Gov. Rick Snyder insists that his proposal to pledge away $350 million of state revenue over 20 years and drop it into the Detroit bankruptcy pot is not a taxpayer bailout.
Call it what you will, but statewide taxpayers will foot the bill and Detroit will get the money.
Statewide and national media quickly turned to Mackinac Center experts for an analysis of why Gov. Rick Snyder’s $350 million bailout for Detroit is wrong.
Fiscal Policy Director Michael LaFiave was cited in both an article and editorial in The Detroit News, as well as in MLive and Crain’s Detroit Business. LaFaive also discussed the issue on "The Tony Conley Show" on WILS AM1320 in Lansing.
At a press conference Wednesday, Gov. Rick Snyder explained why he wants to give $350 million in state money — which he insists is not a bailout — to Detroit.
Details are lacking, but Gov. Snyder says he wants an "investment" from state tobacco revenue settlement funds to match a generous offer of support from private foundations. He says this would protect Detroit pensioners and the Detroit Institute of Arts collection.
Patrick Wright, director of the Mackinac Center Legal Foundation, was a guest on “The Frank Beckmann Show” on WJR AM760 this morning, discussing a case heard by the U.S. Supreme Court yesterday in which he and Mackinac Center Executive Vice President Michael Reitz filed an amicus brief. Both were present for oral arguments in Washington, D.C., Tuesday in Harris v. Quinn.
