Similar to the Chamber poll results, MDM participants are deeply concerned about such issues as partisanship among state political leaders, the need to greatly intensify workforce preparation, and simplifying state business taxes.

The Center next week will release the full findings from more than 175 "Community Conversations" in every corner of the state. Center President Phil Power will also discuss the public engagement campaign in the opening session of this year's policy conference on Mackinac Island.

Check out next week's newsletter for the full report, called "Michigan's Defining Moment: A Common Ground Agenda for Michigan's Transformation."

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Action in Lansing continues to illustrate just how difficult that compromise can be.

The Michigan Legislature took a great step this week in passing the Great Lakes Compact. But the two chambers continue to spar over implementing legislation. In a classic business-versus- environment fight, the Senate has voted to allow more lenient water withdrawals than a competing version in the House.

Environmentalists are outraged, as evidenced by this press release from the Michgian Environmental Council:

"The Senate bills, as an example, allow up to 25 percent of stream flow in some parts of some rivers to be taken by water pumpers with no permit or oversight," said Cyndi Roper of Clean Water Action. "They also allow excessive mortality of trout in coldwater streams and shut out meaningful public input on big withdrawal proposals. And water users would need to pump 2 million gallons per day to even require a permit – a threshold that would apply to no one except power plants and large municipal water systems."

In contrast with the Michigan Senate's 2 million gallon permit threshold, Minnesota has a permit threshold of 10,000 gallons.

"Why is Michigan – located smack in the middle of the Great Lakes – failing to care for its water resources better than states with much less to gain?" asked Rusty Gates, president of Anglers of the AuSable.

Farm and manafacturing groups argue the stricter rules proposed by the House keep most of northern Michigan off-limits to water-related development

The Farm Bureau and Manufacturers Association particularly oppose the House's public trust language and stringent limits on damage permitted to cold-water fish. They maintain the strictures would virtually padlock development in areas with cold-water streams, much of the economically depressed Upper Peninsula, northern Lower Peninsula and western Lower Peninsula.

"We can't support a bill that results in a no-growth policy for half of the state and we can't support a bill that gives the governor control over private property," Michael Johnson, regulatory affairs director for the Michigan Manufacturers Association told the Detroit News.

Despite the ongoing controversy, water law expert and Wayne State law professor Noah Hall was upbeat this week in assessing the progress for the Compact, which may be the Great Lakes Region's best prospect for keeping those water resources in the basin.

"We've had great news out of Wisconsin, a potential breakthrough in Ohio, and a clear bipartisan consensus supporting the compact in Michigan. In Wisconsin, the legislature came back for a special session to approve the Great Lakes compact as part of a major overhaul of the state’s water law. (See www.greatlakeslaw.org/blog/2008/05/wisconsin-legis.html"). In Ohio, a proposed constitutional amendment to protect property rights in water should address concerns that the compact may lead to the “taking” of such rights. (See www.greatlakeslaw.org/blog/2008/05/constitutional.html). In Michigan, Republican state senator Patricia Birkholz and Democratic state representative Rebekah Warren have lead the bipartisan push for the compact, even as the legislature works towards a compromise on the details of how to implement the compact with state regulation of water use.

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With rare bipartisan cooperation, legislators enacted a huge tax break in March to draw film companies to Michigan and two months later more than a dozen projects have been approved for the tax breaks, Crain's reported last week.

"It's difficult for other states to beat this incentive package because it's so aggressive," Chris Baum, senior vice president of sales and marketing for the Detroit Metro Convention & Visitors Bureau told Crains.

It also appears it may be painful for Michigan taxpayers to underwrite the tax breaks for the movie deals. Incoming sales and other taxes as a result of the new film work won't even come close to making up for the lost film tax revenue due to the tax breaks. New estimates from the Michigan Senate Fiscal Agency estimate a net loss to the state general fund budget next year of more than $100 million in 2008-09.

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That creates opportunity for Center for Michigan volunteers to begin the long and steady process of educating the next generation of leaders in Lansing about the common ground, transformational agenda that more than 1,800 of you across the state have helped create.

The Center will unveil that agenda on Thursday, May 22, with a celebration in Lansing for the one-year anniversary of the Michigan's Defining Moment Public Engagement Campaign. Next week's newsletter will exclusively focus on the report we're releasing on the 22nd.

Soon thereafter, it's time we'll begin to organize volunteer meetings with many of those who seek seats this fall in the Michigan House of Representatives. Email us if you'd like to get involved.

To get a sense for the competitive nature of some of the open seats, take a peek into the candidates in 37th District centered in Farmington Hills. Former Oakland County Republican Party Chair Paul Welday is one of three GOP members seeking to square off against former Farmington Hills Mayor Vicki Barnett.

Across the state, in Grand Rapids, the backlash over last fall's budget gridlock and tax increase can be seen in the 75th District race where incumbent Democrat Robert Dean, a first-termer, faces three GOP challengers running largely anti-tax, anti-Lansing campaigns.

To get familiar with the candidates in your area, peruse the list of all statewide candidates from the Secretary of State Elections Division

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Posted by taterfalls.

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First, a quick recap: Last year, faced with a billion-dollar deficit and threat of a state government shutdown, the legislature passed and Governor Jennifer Granholm signed a new Michigan Business Tax.

The tax won initial. But weeks later, the deficit-fighting legislature tacked on an incomprehensible, inexplicable and unenforceable tax on a bizarre assortment of services, such as fortune-tellers and baby-shoe bronzers. The business community rose in wrath. What they most worried about was that once there was a tax on any services, there soon might be a tax on all services. So at the last minute, thanks to business pressure, the service tax was repealed.

To make up the lost revenue, a 20 percent surcharge was then hastily tacked on top of the Michigan Business Tax, which took effect Jan. 1, 2008. Now tax bills are finally going out, and there's lots of howling going on -- much of it legitimate. Some businesses are bitterly complaining their tax bills are double or triple what they used to be under the old Single Business Tax.

How did this train wreck happen?

A few days ago, I received a lengthy e-mail from a Republican lawmaker (who wishes to remain anonymous) but who offers some valuable insights. Bottom line: "The service tax was the direct result of the brinksmanship of the GOP leadership in negotiations and (the) lack of GOP members (in) responding to the requests of their traditional supporters in the business community."

That’s pretty stunning -- and here's my attempt to put this all into context: Leading up to the critical votes, both the Michigan Chamber of Commerce and the Detroit Regional Chamber tried to persuade legislators to pass an income tax increase big enough to cover the entire deficit.

Why? Simple: To avoid additional business taxes. The House of Representative figured it out. There, Speaker Andy Dillon and other leaders tried repeatedly to pass a 4.7 percent income tax that would have resolved the budget crisis without resorting to the service tax.

But neither Senate Majority Leader Mike Bishop nor House Minority Leader Craig DeRoche was willing to step forward. They urged their members to hold back and let the Democrats take the political hit for a vote for more taxes. At one point, it looked as though there were as many as 10 Republican representatives ready to vote for an adequate income tax hike, but DeRoche wouldn’t budge.

That was too bad for all concerned. In the end, the attempt to construct only one difficult vote for legislators – an income tax increase sufficient to resolve the budget crisis – failed. Instead, it left lawmakers with three tough votes: One for a smaller increase in the income tax; one for a service tax (that was repealed before it took effect): and one for a 20 percent surcharge on the new business tax.

Since no lawmaker wants to cast difficult and risky votes, it's hard to see how forcing three tough votes was better than one. But that was the political "new math" calculus in Lansing at the time.

And it produced a bitter brew.

My legislative source concludes, "The brinkmanship game of the leaders led to a much worse result for the state. … Republicans need to know that the negotiation and political games led to higher taxes and more revenue to grow state government. Pretty high price."

High indeed. At the end of the day, everybody wound up worse off. Lawmakers, both Republicans and Democrats, had to make three tough tax votes when one would have sufficed.

Businesses are now struggling with a 20 percent surcharge on the new MBT. And the state still faces chronic structural budget deficits – deficits the present tax structure make virtually inevitable.

And the anti-tax fringe, namely the folks who are now trying to recall Speaker of the House Andy Dillon (D-Redford) got a new lease on life. Remember, they started out by going after any lawmakers who supported any tax increase, whether Republican or Democrat. Once they discovered there was limited support for recalls, they dropped all the other efforts and only went after Dillon.

The bottom line: Basing a policy for governing on political expediency turned out to be the worst possible outcome. Worst, not only for legislators who are now regarded as nincompoops by their constituents and the news media but also for the state as a whole.

This sorry tale illustrates all too well one of the worst aspects of our dysfunctional political system, Namely, a wholesale preference by both parties for scoring political points instead of concentrating on rational, long-term government for the state.

If we're going to dig ourselves out of the jam we’re in, this has got to stop. And we all need to find ways to express that -- and to get the word to those we elect and pay to represent us.

***
Editor's Note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics, and a former chairman of the Michigan chapter of the Nature Conservancy. He is also the founder and president of The Center for Michigan, a centrist think-and-do tank which publishes the Michigan Scorecard. The opinions expressed here are Power's own and do not represent the official views of The Center. Power welcomes your comments at ppower@thecenterformichigan.net.

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If that's true, then the dryly titled "State University Summary Data" published by the Michigan House and Senate Fiscal Agencies is a quick look at what’s happening along that new assembly line.

The bottom line: lean state budgets have been very unkind to state universities in recent years.

And, students are bearing the brunt of the pain.

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Public Act 99 of 2007 called for the creation of a "Legislative Commission on Government Efficiency."

The commission is charged with looking into the deepest, darkest corners of state government bureaucracy and finding ways to make it "more efficient" while evaluation the need for each state agency's "functions and services."

Six months later, the panel is getting down to business. The Center for Michigan is among the interest groups that the new panel has called to testify at the panels next meeting on Monday, May 19.

"The objective to to come up with out of the box recommendations on how to move the state forward," Senate Majority Leader Mike Bishop, who collaborated with House Speaker Andy Dillon to form the new panel, told the Center last week. "It began as a bipartisan idea and it will continue as a bipartisan idea. the people involved are really apolitical."

Don't expect quick solutions -- the group has until end of 2009 to issue recommendations and there is already some muttering in Lansing that the panel lacks the muscle and focus to bring forth big changes. But Bishop insists he's asked the group to not wait for 2009. "We're looking for immediate turnover" of reform ideas, he told us.

The Legislative Commission on Government Efficiency includes:

More than six months later, that new panel is getting down to

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Those are the things that hip knowledge economy workers with money in their pockets are looking for in places to live.

Those findings come from a team of MBA students at the University of Michigan Ross School of Business. The student team probed the attitudes of millennial workers, studied happenin' neighborhoods in Chicago and considered Detroit's opportunities for attacting such talent in the near future.

For Detroit, the biz school students said, talent attraction boils down to basics (like keeping the street lights on and delivering other basic public service) and more complex tasks like improving neighborhood retail outlets and better managing Motown's media image.

"Detroit offers a unique opportunity which cities like Boston, New York and Chicago cannot match -- the chance to be a person who has the power to make a difference right away," the biz school students concluded. "To be on the ground floor of the turn around of a city, a city which was thought to be doomed to be a ghost city, is an opportunity which many young professionals will find appealing."

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Key findings of the survey:

The survey also showed that Michigan's nonprofit sector (which includes some 43,000 organizations and nearly 400,000 workers) is viewed as "honest and ethical" by almost four out of five people surveyed.

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Click here for more details.

Email us today at info@thecenterformichigan.net to grab one of the last seats.

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Spring Willow Sunset was posted by ColleenM.

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This photo was posted by Doug Langham on our Michigan Photo Group.

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Check out the 2008 Michigan 50 Companies to Watch as named this week by the Small Business Association of Michigan and the Edward Lowe Foundation.

Together, these firms contribute $464 million in total revenue (with a combined 25 percent growth rate), more than 1,800 employees, and more than 345 new jobs to the Michigan economy.

They are firms like:

ADAMS BUILDING CONTRACTORS in Jackson, which is defying the recessionary economy by gaining work in wastewater treatment plants, ethanol plants, and other projects with an agricultural component.

BAABAAZUZU in Lake Leelanau, which manufactures women's outerwear and accessories from recycled fabrics. The firm has 15 full-time employees and expects to add eight more this year.

iDASHBOARDS in Troy. The firm creates customized business intelligence/tracking software for customers as large as the Navy Federal Credit Union. iDashboards expects to double its full-time staff to 30 employees this year.

The Michigan 50 show what it takes to compete in the global economy.

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The news this week sounded like something out of the Southwest, or Boston, or Texas, or North Carolina. Instead, word of a huge new economy expansion project came out of Kalamazoo

Click here for the web site for MPI Research and a glimpse at the kind of knowledge work experts predict can steadily diversify the Michigan economy.

William Johnston, one of Kalamazoo's top business and civic leaders, explained the deal in terms that can inspire the rest of Michigan:

"What differentiates us in our refusal to let our destiny be controlled by events," Johnston told the Kalamazoo Gazette. "We didn't whine, we didn't complain. We brought the community together to amplify our strengths... In essence, a recession was created and we refused to participate... The wind is still in our face, but now we have some momentum at our back."

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Welcome to ePrize, a small firm with a big ambition: To be the Google of the interactive marketing and promotion industry. Location is key, and ePrize is just a jammed parking lot away from the Walker Wire Company. Walker makes heavy-duty industrial strength wire for industrial uses. ePrize manages customer marketing and affiliation programs for an amazing range of Fortune 500 companies and hundreds of thousands of their customers.

The contrast could not be more abrupt.

Inside ePrize – at $60 million in sales and growing at a 40 percent annual rate, according to founder and CEO Josh Linkner – hundreds of staffers sit at the 21st Century version of the assembly line. But instead of a dimly lit factory floor with automobile chassis muscled into place by burly assembly workers, ePrize is filled with bright colors, ergonomic chairs, high-powered computers and free pop and bottled water in every room. Employees are in their late 20's to early 30's, dressed in dazzling variety and "questioning everything," Linkner says.

Henry Ford's great innovation was to invent the way to assemble perfectly machined parts into an automobile – countless identical steps, repeated endlessly during the day with no room for innovation or variation. Old photographs of the assembly line of that era mostly show seemingly middle-aged men, all dressed alike, all performing their assigned functions with no variation.

By contrast, ePrize's employee handbook runs like this: "Many companies use words like 'passion' and 'creativity.' But when we use those words, it's different. These are not merely buzzwords, they are core philosophies that embody who we are. We take things to the edge ... to extremes … to the ultimate level.

"To the power of 'e'."

Josh Linkner, the man behind the virtual curtain, earned a BS in advertising from the University of Florida, then served as Senior Vice President for Rare Medium Group, a web-consulting and venture capital firm before founding ePrize in 1999. After two rounds of financing – and a total of $43 million in investment – ePrize now has offices in New York, Chicago, Los Angeles, Dallas and London.

Linkner’s ePrize relies on the Internet, which can be everywhere and anywhere. That means he could locate it anywhere on earth.

So why is ePrize in Pleasant Ridge? Linkner explains. He was born in Southfield and now lives in Bloomfield Hills, so it's near home. But there’s much more. "There are great opportunities to build a technology company here," Linkner explains. "There is a rich talent base in Michigan, a great work ethic and deep and solid entrepreneurial roots. The cost structure, if anything, is lower than elsewhere." ePrize got some help, as well, from the Michigan Economic Development Corporation’s job creation program. In fact, the firm is featured in one of the MEDC's TV ads promoting the advantages of locating in Michigan.

Ilya Snider, one of the firm’s 350 employees, puts it this way: "I like it here. Why leave if you have it all? Climate, family, lots of things to do, downtown Detroit. Everything I want is right here."

Linkner says his biggest management problem is keeping a firm hold on galloping growth. "We’re a lot like what the great car companies were like, a century ago," he explains. "We're just entering our greatest period of growth."

That's exactly the attitude a lot more of us need. Among our other ailments, Michigan is suffering from a bad case of low self-esteem. We can't seem to get it through our collective heads that we have – right here at home – a set of distinctive, world-competitive assets: A hard-driving work force with boundless skills and talents. Great research universities. A wonderful quality of life at an affordable cost. Driven and capable entrepreneurs.

Walking through the hum of ePrize’s 21st century assembly line, I was struck by the thought that here before my eyes was today's version of the Ford Motor Company, of the Dow Chemical Company, of Kellogg's and Upjohn.

Entrepreneurship runs deep in our collective DNA. Linkner and his colleagues at ePrize recognize it; they are the latest generation.

The task at hand for our state is to help others do so, too.

***
Editor's Note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics, and a former chairman of the Michigan chapter of the Nature Conservancy. He is also the founder and president of The Center for Michigan, a centrist think-and-do tank which publishes the Michigan Scorecard. The opinions expressed here are Power’s own and do not represent the official views of The Center. Power welcomes your comments at ppower@thecenterformichigan.net.

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The West Michigan Strategic Alliance offered its "State of the Region" report this week with plenty of good economic news:

But the Strategic Alliance didn't blink in also assessing the region's ongoing challenges, including regional school populations with 40 percent of the students receiving free and reduced lunches due to poverty, rising housing cost burdens, and a widening income disparity between racial groups.

Another new report by The Right Place economic development group in Grand Rapids offers bittersweet news in a new survey of regional employers. More than a third of the businesses responding to the survey said they planned to hire more than 100 workers in the next years. Two-thirds of the businesses said they'd hire more than 100 workers over the next five years. Yet despite the tough economy and relatively high unemployment rate, 40 percent of the responding businesses also described their access to talented workes as "moderately scarce" or "very scarce."

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Population in the region will also outpace growth in the rest of the state and nation, according to the Traverse City Area Chamber of Commerce 2008 Economic Forecast.

While there is growing opportunity Up North, the story is similar to downstate for northern workers who fail to gain new skills to compete in the 21st Century global economy.

"Our new economy will demand a significantly higher level of academic preparation and achievement," according to the TC Chamber's report. "During 2008, we expect to see continued layoffs of low-skilled production workers in the manufacturing sector due to declines in the auto industry. However, the regional economy is growing jobs in other sectors, especially healthcare, human services, and business services. Unemployment should remain at approximately its current rate, with difficult transitions for individuals who require retraining for new employment."

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The folks at the Michgian business journals are on to this concept, too. Their ongoing series of reports -- naturally called "Rebranding Michigan" -- offers insights on Michigan entrepreneurs and new ways of doing business.

Check out Rebranding Michigan to find venture capitalists and organizations in Michigan seeking to grow entrepreneurs rather than employees.

If patents are any indication, the state is, indeed, growing more entrepreneurial. As Rebranding Michigan explains, patents in Michigan are on the rise and are pushing 4,000 per year.

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A package of bills almost ready for the governor's signature would create the Michigan Promotion Program and more than double Michigan tourism promotion funding from state coffers.

Under the plan, which relies on savings gained through state bond refinancing, Michigan tourism spending would reach $30 million this year and hold at $25 million over the next two years. That's a delighful contrast from just three years ago when Michigan spent a meager $5.7 million promoting our woods, waters, and bountiful recreational and cultural assets.

As noted in the Michigan Scorecard, the Great Lakes State has ranked way below leading states in tourism spending in recent years.

State budget analysts explained in a recent report why boosting tourism promotion is a no-brainer...

"... Tourism promotion expenditures by the state ove the last three years resulted in estimated increased tax revenue at an average rate of $2.76 of additional state tax revenue for every dollar spent on advertising. It is likely that the additional tourism expenditures would result in a positive return to the economy at large and to state revenue in particular."

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What recession?

Take one look at the construction cranes dominating the skyline of west Michigan's hub city and you get the hint that things seem to be going just fine there.

Now comes a brand-new stack of data from the Right Place economic development agency showing just how well Grand Rapids and west Michigan are adapting to the 21st Century global economy:

Of metros above one million people, west Michigan's 21-minute average commute time is lowest in the

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Center for Michigan Steering Committee member Craig Ruff bemoans our star status in the "National Laughlight."

Internationally acclaimed author and Milford funeral director Thomas Lynch samples the great talent residing here and proclaims that "maybe we are worthy of our better dreams."

Likewise, the EnvisionMichigan Story Contest is bubbling over with the better dreams of our people. Consider these thoughts culled from among the more than 180 entrants...

"I see Michigan filled with thriving communities. These communities are locally-based; that is, people live and work and play largely right in their own community. Their community has been planned to be locally sufficient. The hour-plus long commutes have become unthinkable for many, because people can walk or bike to work. Other people drive Michigan-produced electric cars or use light rail. There are many manufacturing facilities supplying the alternative energy, automotive, and diverse industries located right here in Michigan. These facilities, in turn, rely on renewable energy. We still have some wonderful big cities with strong neighborhoods, but the state is more integrated."
– Nancy Angellotti

"My vision for the State is for an economic comeback by investing in our natural resources, technology, neighborhoods and a better school system with smaller classrooms." – Jason Senior

"When I see people leaving Michigan because they believe there is no future here for them, I wonder if they know Michigan is sitting on a resource more valuable than all the oil in Saudi Arabia? Water shortages are not just a distant problem… Atlanta for example, is in the grip of a long and sustained drought. There is not enough fresh water in Florida to sustain the levels of population growth Miami is experiencing. The same is true in Arizona, and the list goes on. Lack of water will soon negatively impact the ability of these areas to grow and prosper. As our loss has been their gain, so shall their loss be ours…Of course this is all long term, and does little to blunt the pain many feel today. Still, it should give those of us with the determination and the opportunity to remain in Michigan a reason to hang on. Besides, this is a wonderful place, a natural paradise, the envy of the world, and our hope for the future. A future, I might add, we need not fear. Economies change. Industries rise and fall. But our bodies will always need plenty of H2O." – Clay Morgan

"My family recently purchased a 100+ year-old farmhouse… in the historic village of Grass Lake, a small railside town where the county offices have lakefront property and the grocery store has hillside lakeview. Three-hundred-sixty-five days in one year, and we will be enjoying them all at 365 Lake Street. Most people miss the opportunity to breathe slowly and watch three-hundred-sixty-five consecutive orbs sink into the giant sparkling mirror known as Grass Lake. More than just a building, the aging farmhouse is a triumph of independence for my family." – Jimmy Tomczak

"For me, Michigan is an uneven mix of hidden natural beauty and gritty human struggle. Mostly, I see and feel the struggle. For the state to thrive, Michigan residents like myself will have to let go of the familiar, and either accept the challenge of a new identity or inhabit a museum. We're working with a Michigan history that's heavy in steel and wage security. It's a big endeavor ahead to create a new Michigan, but I see our residents grudgingly committed for the long haul. Vacations are great, but Michigan is home." – Jill Oviatt

"In the eyes of many, our state is doomed for absolute collapse. I am looking at the dawn of a new Michigan, one that relies on its most valuable resource: its citizens. Education has taken the assembly line's place as our state’s most vital tool. When I finish my education, I hope to be one of these great entrepreneurs that jump-starts our economy. I will not cling to the idea that I cannot create my own destiny. The tools and environment for the future are here, waiting to be utilized by those who share my ambition." – Rob Schwartz

"I was born and raised in Michigan, and like many young people, I thought that my future lay somewhere else. I thought there wasn't enough for me in Michigan, and that I needed something...more. So I moved to Miami and then New York City searching for that distant place to call home. On September 11, 2001 while living in New York City I learned an important lesson: the place you call home is where your hope resides. Your future is not what happens to you, but what you create. I moved home, to my Michigan, to Grand Rapids where I could start a family and create the life I always hoped for. Michigan is my hope because it offers my children the things I find important: access to culture and nature. Within a half hour drive, we're on the beach of Lake Michigan, or hiking trails, or in the heart of Grand Rapids visiting a museum. Michigan offers variety in which a family can thrive." – Tonya Sirois

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Readers of "Fresh Thoughts" already knew many of the details of a Detroit News special report this week on Michigan's failure to bring prison spending under control. Just last week we raised concern over new state projections showing Michigan is on pace to reach 55,000 prison inmates by 2012 - a 77% increase since 1991.

But the Detroit News series is an excellent resource for any engaged citizen interested in spreading the word about Lansing's mixed up budget priorities. The series found that:

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Our picture of the week was posted by tgrabb.

Post your photo on our Michigan Photo Group.

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If so, you might want to take a look at what’s going on in the 17th State Representative District. It consists of a corridor of land that is mostly shaped like the northern part of Idaho, and includes Redford Township, part of southeastern Livonia and northern Dearborn Heights. That’s the turf that the current Speaker of the House, Andy Dillon, calls home. But it also the site of an increasingly ugly campaign to recall the 46-year-old Democrat from his seat.

Words like “thug,” “liar,” and “criminal” are flying around freely, and wads of money are being spent. The recall, one of several mounted by the Michigan Taxpayers Alliance, is supposedly in response to Dillon’s vote last fall to increase the state income tax to overcome a billion-dollar-plus deficit in the state’s budget.

Initially, six representatives and four senators, including both Republicans and Democrats, were targeted for removal.

But it now looks as though Dillon is the main focus of the recall movement. That, in turn, raises the prospect that the right of recall is being manipulated for purely partisan purposes. The Michigan Constitution says that valid signatures of 25 percent of registered voters who voted in the last election for governor are enough to force recall of a sitting lawmaker.

In the case of the 17th district, that comes to around 8,720 signatures, due by May 1. Recall advocates are led by former State Rep. Leon Drolet, now a Macomb County commissioner, and Rose Bogaert, of Dearborn Heights. She is chairwoman of the Wayne County Taxpayers Association and Taxpayers to Recall Andy Dillon

Bogaert says her group wants to collect at least 10,000 signatures, to make sure they have a cushion; some names are always certain to be invalid or duplicates. According to three sources (who asked for anonymity for fear of harassment), the pro-recall people started out paying $2 for every signature. That went to $4 each, then $6. Now the going rate appears to be $10 per name.

That’s a lot of dough! If they’re aiming for 10,000 signatures, that’s going to cost a cool $100,000, not counting other expenses like postage (fliers have been mailed to all houses in the district) newspaper ads, office and legal expenses. That’s big money.

All things considered, I wouldn’t be surprised if total campaign costs come to more than $250,000.

So where’s all this money coming from? Democrats and Dillon supporters talk darkly about far right-wing, out-of-state moneybags. Lending credence to this suspicion is the fact that the national anti-tax guru, Washington-based Grover Norquist, President of Americans for Tax Reform, is a member of Drolet’s board.

Two long-term Lansing lobbyists, who wouldn’t go on the record, told me big GOP money is behind the effort, “because it will be a big feather in their hat if they knock off the Democratic Speaker of the House.” They also mention House Minority Leader, Republican Rep. Craig DeRoche (R-Novi), although he denies being involved.

When I asked Bogaert directly about the money, she wouldn’t tell me. “Companies, individuals,” she said, “you can’t increase business taxes by 22 percent and expect them to be happy about it.”
But why won’t she tell me who’s paying? “It would give our opponents a leg up on us.”

Drolet says his campaign has more than 300 donors, almost all of them from Michigan.

With the fog machines turned on full blast, I expect we’ll never know for sure where the real money is coming from.

I’m also told that petition circulators are being devious, asking voters if they “want to reduce their taxes” by signing, or even “cut gas prices.” One source claimed circulators said the petitions supported stem cell research and universal health care. For the record, Michigan election law (168.957) requires signatures not be obtained “through fraud, deceit, or misrepresentation.”

One man named Hugh H. Jordan III wrote a letter to the editor of the local paper, The Redford Observer, that said “One of the petition signature collectors came to my door a few days ago and said to me, ‘Sign this petition to lower your taxes.’ Thankfully, I knew that the petition was actually intended to recall Speaker of the House Andy Dillon, and I declined to sign.”

But even though there may be a bull’s eye pinned to his behind, Dillon is fighting back. He’s dispatched people to shadow petition circulators and to urge people not to sign. “I feel bad for the folks in my district,” Dillon told me. “If petitions were being gathered based on what I truly did, that would be fine. But they’re not.

“And there’s an election this November; if people don’t like what I’ve done in office, they can chuck me out then and there.” Without spending a pile on special elections, either.

(What he didn’t add is that even if he wins, he’ll be gone forever two years after that, thanks to the curse of term limits.)

Term limits are bad enough, but I’ve always thought that threatening to recall elected lawmakers because they cast a certain vote is awfully close to blackmail. Recalls, if they succeed, solve nothing; special elections cost thousands of dollars and newly elected legislators who come in as part of a recall have no idea what they’re up to before they face a regular election in November.

And it seems perverse that local voters, who made their preferences known last November, could be stampeded by a bunch of noisy activists into reversing course just 17 months later.

Recalls – perhaps especially the one now underway against Dillon – only fuel the kind of hyper-partisan warfare we all have come to hate . Elections fueled by shadowy, dogmatic interest groups with fat pocketbooks are hardly what Michigan needs.

Whether you agree with the way he votes or not, Speaker Dillon has been an able legislator. He fully deserves to remain in office at least until his term expires in January. And neither he, nor we, should have to put up with any of these silly and obvious recall games.

***

Editor’s Note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics, and a former president of the Michigan chapter of the Nature Conservancy. He is also the founder and president of The Center for Michigan, a centrist think-and-do tank which publishes the Michigan Scorecard. The opinions expressed here are Power’s own and do not represent the official views of The Center. Power welcomes your comments at ppower@thecenterformichigan.net.

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"Part of an initiative called Michigan's Defining Moment, it was an assembly of community leaders across my county: a local college president, a mayor, business leaders, a district judge, a school superintendent and local government officials. The meeting was facilitated by Rich Perlberg, general manager and executive editor of the Livingston County Daily Press & Argus, who invited me," Flanagan wrote. "Our task was to help devise action steps in a structured plan toward rebuilding Michigan's educational system, economy and government — a plan created by input from more than 1,500 Michigan citizens. The evening flew by in rich conversation. It's exciting to hang out with smart people, and talk about the huge issues and challenges facing a state we all love."

We're busily tallying the results from the Round Two statewide Community Conversations and will issue in May the common ground agenda, strategies and action steps arising from those deliberative gatherings of more than 1,500 deeply committed Michigan residents eager for change and transformation in our state.

Then we'll quickly appeal to all Michigan's Defining Moment participants to greatly expand the campaign in their own communities and take the citizens' agenda directly to elected leaders over the summer.

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Why, many ask, is our state so unwilling to try new things? Possibly, it's the result of an economy that for decades relied on massive industrial enterprises (the Big Three and their giant suppliers) that gave workers little incentive for innovation or risk-taking. Without any doubt, we've been infected by widespread feelings of dependency and belief in a sort of corporate welfare state.

Certainly, generations grew up believing that all they had to do in life was catch on with "Generous Motors" and they'd be set for life.

As a result, many now sadly believe that the spirit of innovative brilliance and entrepreneurial risk never settled in Michigan.

Ah, but how wrong they are!

This may come as a shock to many, but there was a time when Michigan was widely regarded as the Silicon Valley of America, a place where entrepreneurs seemed to spring up out of the ground and took on the risks of failure with a jaunty optimism.

It happened right around the beginning of the 20th century. Back then, a whole raft of entrepreneurs created entirely new companies that were on the cutting edge of what was then regarded as high technology. Many of them went on to establish firms that became giant players in today’s global economy.

The most famous example: Henry Ford, who in 1903 founded today's Ford Motor Company. Ford became successful thanks to his adaptation of the fundamental new technology of the assembly line. His innovation was to use interchangeable, identical parts to manufacture the automobile quickly and at an affordable price. When Mr. Ford dumped a bunch of identical parts on the floor of an exposition in Paris, the assembled crowd gasped in admiration.

And he had plenty of company:

Herbert Henry Dow, a Canadian chemist, heard about the salt seeps around Midland. He invented a new way of extracting Bromine from the quantities of brine in the area. And the company he started in 1897 to exploit this new technology – The Dow Chemical Co. – is today arguably the world’s leading firm of its kind.

Dr. John Harvey Kellogg was a physician who started a sanatorium in Battle Creek to experiment with his new fangled ideas about a good diet for sick patients. His brother, Keith Kellogg, had the idea that he could sell this stuff and make a profit. So he founded the Battle Creek Toasted Corn Flake Company in 1906. The resulting Kellogg Company made Battle Creek the cereal city.

Another physician, Dr. William Upjohn, of Kalamazoo, was aggravated by the problem of finding ways to give his patients just the right amount of medicine. The elixirs of the day varied in potency and the pills were so hard you had to bust them up with a hammer! So, in 1886 he and his brother, Henry Upjohn, founded the Upjohn Pill and Granule Co., later renamed the Upjohn Pharmaceutical Company. It went on to become a world leader for a century, until gradually disappearing into the Pfizer empire after 1995.

J. L. Hudson founded in 1881 the J. L. Hudson Company; by the 1930's it was the third largest retailer in the world. A serial entrepreneur, Mrs. Hudson also founded the Hudson Motor Company (1909-1954) which had a relatively short but glorious life.

Each of these entrepreneurs took advantage of the distinctive resources of Michigan at the time. As a result of the profitable logging operations that cut the great pines of northern Michigan and dug the ore from the mines, Michigan had a lot of start-up capital available to finance new ventures. Mr. Dow had only to look around at all the brine around Midland and figure out how best to take advantage of it.

The Kelloggs were lucky enough to be on the rail line that brought corn to the ovens of their toasted corn flake company and shipped boxes of cereal around the country.
But the point is, however, that both sets of men figured their natural advantage out, at a time when other men couldn’t see it.

Each of these took what they had to work with in what was, back then the Silicon Valley of America and added imagination, drive and quite a lot of luck and guts. They made great companies – and great fortunes – that still stand as monuments to the Michigan economy.

What we sometimes forget is that they weren’t always successful, either -- certainly not the first time. Henry Ford's first two automotive companies failed. Many of the other pioneers of the industrial age had their financial ups and downs as well.

But they endured and pressed on -- and did so without Starbucks, modern medicine or air conditioning. So: even in today's relatively dark days of high unemployment and widespread home foreclosures, there is no reason that men – and women – like them cannot do the same, or better today. In fact, given the lessons we’ve learned from the past, it would be a surprise if they didn't succeed.

***

Editor’s Note: Former newspaper publisher and University of Michigan Regent Phil Power is a longtime observer of Michigan politics and economics, and a former president of the Michigan chapter of the Nature Conservancy. He is also the founder and president of The Center for Michigan, a centrist think-and-do tank which publishes the Michigan Scorecard. The opinions expressed here are Power’s own and do not represent the official views of The Center. Power welcomes your comments at ppower@thecenterformichigan.net.

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That's the most troubling finding in new state projections of future prison populations.

At a cost of more than $30,000 per prisoner per year, that's another $150 million per year taxpayers would have to spend on prisons. That's enough money to provide full-ride, all-expenses-paid annual scholarships for 8,000 Michigan State University students.

State corrections officials say modest reforms designed to help parolees adjust to life back in society are beginning to help stem the growth of the prison population. But, officials say, long-term trends in felony convictions and Michigan's tough sentencing laws are putting prison population trends back on a steep growth curve.

The state is employing several stopgap measures, including:

But without sentencing reform (in other words, reduced sentences for various felony convictions), prison officials project they will be unable to reduce prison population growth over the long term.

So, what's the cost of justice, crime and punishment? What other public services must be cut, or taxes raised, to pay for the ever-rising prison populations? For the sake of other forms of public safety, including education, environmental protection, and human services for those not in prison, do we need to consider radical overhaul of prison operations?

More than 40 open seats in the Michigan House of Representatives will be contested this year. If candidates knock on your door this summer, ask them what they will do about the cost of Michigan's ever-growing prison population. If they answer your question with a blank stare, are they qualified to receive your vote?

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Henry is one of the leading advocates of a proposal to move from our current full-time legislature. While I admire and respect Henry's civic engagement, I worry the move to a part-time legislature could very likely make things worse, not better, in Lansing.

Here's our running dialogue:

FRESH THOUGHTS: Henry, if Michigan voters passed the proposal to create a part-time legislature, how would that proposal result in higher-quality representatives?

HENRY WOLOSON: I think we all share a genuine desire to try and improve the economic climate and quality of life here in Michigan. The part-time legislature proposal being advanced by Turn Michigan Around requires that a maximum of 100 regular legislative session days must be completed by May 31 each year. Special sessions can be up to an additional 15 days per year. Forty-two states have variations of this formula so that their regular sessions end on different dates but the concept is the same, hence the name "part-time" legislatures.

But our proposal does substantially more than just limit the number of regular session days and by when they must be concluded. Turn Michigan Around also proposes to eliminate term limits for our legislators. As you may know, Michigan currently is one of only 15 states with term limits. State Representatives can only serve three terms of two years each and State Senators can only serve two terms of four years each.

Taken together, our part-time legislature proposal should result in legislative service being more attractive to a wider group of qualified individuals. You mention "higher quality" which is difficult to define. Just because someone may have multiple graduate degrees, they may be less qualified for certain tasks than someone without a college degree with extensive manufacturing experience. Multiple types of skills will be needed by our legislators to design programs to enable Michigan to reinvent itself to be competitive when seeking businesses interested in locating and/or expanding in the United States.

The elimination of term limits should also improve overall legislative expertise. While term limits were passed on the premise that frequent turnover in our Legislature would be positive, most observers would have to conclude that inexperience has caused not only worse legislation but an increase in the influence of special interest lobbyists who frequently have a far better understanding of proposed laws simply because the lobbyists, unlike the members of the legislature, are not term-limited.

Even with legislative support staffs, understanding the ramifications of proposed laws is not an easy task and is made infinitely more difficult when being attempted without adequate experience. To the best of my knowledge, there is no training school for preparation and analysis of legislation. Eliminating term limits will improve the opportunity for people to acquire greater expertise through greater experience.

Plus, with term-limits, legislators are not always focused on lawmaking. For example, one current State Representative in his second term, said that his first term, he was learning on the job. Now in his second term, he feels that he is making major contributions. But he sees other State Representatives in their third and final term who are spending an inordinate amount of time seeking their next "job" since they are term-limited. Would not the elimination of term limits improve the focus of our lawmakers and hence improve the quality of their representation?

FRESH THOUGHTS: Beyond the need to press legislators to pass budgets in a timely manor, why would we need the mid-year session deadline? I can see the motivation for forcing legislators to pass all budget measures by May 31. Such a rule could have prevented last fall's budget debacle. But it's a complex time and complex issues tend to move through the legislature quite slowly. Examples: rewriting the business tax code, creating the new education standards, and compromise legislation on water withdrawals and the Great Lakes Compact (not yet done after months of discussion). Beyond the timeliness of the budget, what’s the motivation for limiting legislators' time on the job?

HENRY WOLOSON: The motivation for limiting legislators' time on the job is to improve productivity. Human nature causes us to work better with deadlines. Two former legislators once told me that the vast majority of legislative work is conducted "… in the last two weeks of the session." Not May 31, not September 30 but the last two weeks of the session, whenever that might be.

You mentioned how complex issues tend to move slowly. Good. Current State Representative Sheen recently spoke at a meeting I attended and he said that he has frequently been asked to vote on bills that were presented to him ten minutes before they called for a vote. This is under the present "full-time" legislature.

Also, by limiting the time of regular sessions, this enables the legislators to return to their home districts where they can spend more time learning the problems facing their constituents rather than associating with special interest group lobbyists.

FRESH THOUGHTS: Repealing term limits has discussed as a key need in many of the Center for Michigan’s more than 100 Community Conversations involving more than 1,500 citizens and community leaders across the state in recent months. The same sentiment is on the tips of tongues of many Lansing insiders who must deal with the Legislature on a regular basis. The lack of experience and trust in the Legislature is also decried by those who hold the seats! I worry, though, that the gains of ridding us of term limits could be wiped out by the unintended consequences of a part-time legislature. Back in the early 90s, term limits were widely seen as “the fix.” Is part-time just the reform fad du jour?

HENRY WOLOSON: By repealing term limits, we will increase the overall institutional experience of the legislators. They will be able to operate more efficiently and effectively since they will have seen similar problems in previous sessions. Until recently, our legislators worked part-time are were able to complete their work in a timely manner even though the issues confronting them were "complex" by the standards of the day.

You ask, "Is part-time just the reform fad du jour?" If that were true, then why have 42 states ( a whopping 84 percent ) limited the time their legislatures can be in session and therefore can be classified as "part-time?" Unlike the minority of states with term limits ( 30 percent ), the states with part-time legislatures are the vast majority. And when was the last time a state moved from part-time to full-time status? It is not a trend being reported anywhere that I can find.

You mention that repealing term limits was frequently cited as a "key need" during your Community Conversations. How important is it to your organization and to Michigan? Given the low regard the general public has (justifiably after the budget fiasco of 2007) for the Legislature, what are the legislators willing to give up in order to eliminate term limits? Surveys have shown that the voters will not repeal term limits without receiving some type of concessions.

FRESH THOUGHTS: Wouldn't the part-time restriction result in unnatural limitations on the candidate pool and cause inherent conflicts of interest? Every person must act in self interest for his/her own family. Can we really expect a broad cross-section of experienced, highly talented, community-oriented leaders to be attracted to a part-time job with a $40,000 salary? I can see where such a job might attract attorneys and doctors who could split time spent in practice with time spent in Lansing. And such a setup would surely be attractive to retirees. But what about working professionals? What about young professionals? Example… I have a college buddy who lives in Grand Rapids. Let's call him Shelby. He’s the vice president of a bank. He went to undergrad on an academic scholarship. He’s in grad school getting a master's in public administration with a specialty in health care policy. He’s the leader of his block club. He has three school-aged children. Shelby would like to run for the legislature. And, because he’s so grounded in so many ways, he has an amazing skillset with which to serve. But how could he do so on a $40,000 salary? Could he really expect his employer to let him disappear for five months a year? How would your proposal make room for people like Shelby in Lansing? If the bank did grant Shelby the time off, doesn't Shelby have a serious conflict of interest? What does Shelby owe the bank while he’s in the capitol? Conflict of interest is one of the biggest concerns I’ve heard expressed about the part-time proposal. The worry is that many seats will be tools of special interest – subsidized by specific interest groups, businesses, and the like who want a hired gun with a vote on the floor. How would the part-time proposal guard against this kind of abuse?

HENRY WOLOSON: I can provide some real examples. In my legislature district, a candidate for State Representative is running for office and is supportive of our part-time legislature petition even though the proposed compensation would be approximately one-half what is currently paid. This person is an attorney with extensive experience in municipal law and is presently a Trustee of Independence Township. How is that for "higher quality?" The part-time format enables him to bring his expertise to Lansing and return to his legal practice after May 31.

Another individual is also running for State Representative, supports our proposal and has extensive experience as a senior staff member for a member of Congress. Again, would this not be a high quality candidate?

We have people expressing interest in running who were previously in management positions at one of The Big Three auto makers. They have taken early retirement and want to use their experience and skills to try and improve the economic environment for their children. In many cases, these people have expressed regret that their children who were educated at Michigan schools had no choice but to leave our state to secure employment.

I can certainly appreciate the concern that by moving to a part-time format we could be losing people who cannot afford to serve at the reduced compensation level. But if higher compensation automatically results in better quality, why in 2007 did Michigan's second highest paid in the country legislators have so much trouble producing a state budget in a timely manner? Forty-nine other states, all but one with lesser paid legislators, managed to produce their state budgets on time.

According to the National Conference of State Legislators, Michigan is one of only eight states whose legislature meets throughout the year. All of the 42 states with part-time state legislatures are experiencing better job growth than Michigan. If a part-time legislature automatically attracts lesser quality (and qualified) individuals, would not at least one of these
42 states have worse economic conditions than Michigan? Are not the legislatures responsible for passing laws concerning taxation, education, worksite rules, etc. which have a direct impact on economic conditions?

We have no intention or desire to punish our legislators by requiring that they work the same number of hours for substantially less pay. If that were the case, we could have selected the compensation formula used by New Hampshire which pays their legislators $ 100 per year and no benefits. A current member of the New Hampshire Legislature told me that they frequently have to run against someone to win these high paying positions.

And how does the current full-time Legislature prevent conflicts of interest? You are concerned that a part-time legislator might favor his or her "other" employer. But what is to keep a current legislator from favoring the employer of his or her spouse, or child, or parent, or friend? Or the well-documented cases where elected officials support legislation that favor a particular industry and then are immediately employed in that industry after leaving "full-time" elected offices. The solution is better ethics and disclosure laws for all elected officials, full or part-time. This has already been stated as a future project for Reform Michigan Government. When drafting our part-time legislator petition, I personally contacted Common Cause of Michigan, the Michigan Campaign Finance Network, Oakland County Clerk Ruth Johnson and others about including provisions in our petition that would address campaign financing and disclosure provisions to expose conflicts of interest. Ultimately we had to abandon these provisions due to making the petition too complex and therefore increasing the likelihood that the general public would not understand the multiple provisions and subsequently not support the petition drive.

Members of Congress are considered full-time and receive compensation far above our legislators. But several have gone to jail recently due to being proven guilty of corruption. A past governor of Illinois, a well-paid, full-time position, is currently serving a six year prison term for corruption. Disclosure is the key. New Hampshire pays their lawmakers only $ 100 per year and no benefits and I do not recall any of their legislators recently being accused of conflicts of interest or corruption. They obviously have other jobs and are managing to conduct state business better than Michigan’s second highest paid in the nation legislators.

FRESH THOUGHTS: Why does pay even matter? Why not pay them more? How will lower pay result in higher legislator quality? Maybe we need executive-level legislators to deal with the executive-level decisions needed to help transform our state? If so, why not higher legislative pay? Either way, it’s not much of a financial impact, is it? Cutting legislator pay in half saves about $6 million. Raising pay by 50 percent costs $6 million. That’s less than one-tenth of one percent of the state general fund budget, or about six dollars for every $10,000 in the general fund.

HENRY WOLOSON: Michigan already has the second highest paid legislators in the nation and what has it gotten us? The highest unemployment rate in the country and the budget circus of 2007. I know of no supporter of the part-time legislature who has argued that lower pay will result in higher legislator quality. Certainly higher pay has not improved legislator quality. The issue is comparable pay to other states. California is the only state which pays their legislators more than Michigan but they have more than three times the population we have and they have 23 percent FEWER lawmakers. Our ratio of compensation per resident is far above the norm and what results have we received for this higher pay scale?

Why should we pay more than we can afford or need to pay? Michigan pays their legislators $ 79,650 per year plus $12,000 per year for expenses. The average salary paid to the legislators of the five states whose population is just larger than Michigan’s and the five states whose population is just smaller than ours is $ 45,700. Our legislators are already compensated well above the states closest to us in population. As I previously mention, New Hampshire pays their legislators $ 100 per year with no benefits. Texas, the second most populated state in the nation pays their lawmakers only $ 7,200 per year and that state had four of the fastest growing counties in the country last year. Clearly compensation was not an issue there.

The goal of a part-time legislature is not just to save money. It is to improve efficiency. Additional cost savings can be gained from reductions of staff that are no longer needed if the legislature is part-time. For example, Michigan is the eighth most populated state with approximately 10 million people. Our legislative budget is currently $115 million per year. Ohio, ranks seventh in population with 1.5 million more people but has a legislative budget less than half that of Michigan. Why? One reason is shared staffs rather than partisan individual staffs. By adopting similar staffing, we could possibility cut our legislative budget by $ 50 million per year. Even growing states are better managed. Georgia is number nine in population and experienced a 14 percent growth rate in residents between 2000 and 7/1/2006 and yet has a legislative budget that is less than 60 percent of Michigan’s. Cost savings can be achieved once the regular sessions are limited.

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I am recently being recruited by several Sun Belt institutions, and it has made me think about what it would take to make Michigan a really attractive place for me to live. Some thoughts your readers might find interesting.First some background. I am a professor at a university in Michigan.

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To date, more than 1,500 community leaders and engaged residents have taken part in some 150 community conversations in every region of the state. Collectively, they've spent more than 6000 hours developing a common ground agenda for a more prosperous Michigan future.

On May 22nd, we say thank you and celelebrate.

If you're among the 100 Founding Champions of this movement, or a convener or participant in a community conversation, or an EnvisionMichigan entrant, or simply a curious citizen, you're invited.

Please see the enclosed invitation/RSVP and join us aboard the Michigan Princess Riverboat. This complimentary evening will feature a running slideshow of hundreds of breathtaking Michigan photos from volunteer photographers from across the state, a Michigan-themed dinner, and a keynote address by national political strategist Matthew Dowd, author of "Applebee's America" and a commentator for ABCNews.com.

Seating is limited. Please reserve your space today!

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