By Phil Power - January 21, 2010
Within the next few weeks, Michigan's three top leaders: Speaker of House Andy Dillon, Senate Majority Leader Mike Bishop and Governor Jennifer Granholm – have a last-chance opportunity to redeem their roles as leaders of this state.
During their years in power, they have tolerated the fierce and rigid partisanship that has stymied our ability to get our financial house in order.
For seven years now, the state’s financial position has been a steadily worsening mess.
This year – surprise! – the situation is no different: Consensus estimates released last week in Lansing show that for the year starting next Oct. 1, Michigan will face at least a $1.725 billion shortfall, most of it in the General Fund, which funds programs including higher education, prisons and Medicaid.
The rest of the projected deficit is a $425 million hole in the School Aid Fund. If that trend continues — and it is more likely to get worse than better — this means a $268 per pupil cut in school funding. That‘s on top of the $165 per-pupil-cut per Michigan pupil that’s scheduled to take effect year.
Balancing the budget this year will be much tougher than it was last year, when the politicians were able to use more than $1 billion in federal stimulus money to plug the hole. Now, there’s no more than $200 million in stimulus funds remaining.
Something clearly has to be done to address the root of the problem. That means trying to solve the chronic structural state budget deficit that has been at the heart of our annual financial crises, year after year. There are two things that need to be done to make that happen: 1) Adopting reforms in the size, workings and cost of government at all levels. 2) Reforming our crazy-quilt tax system.
The stage is set – and has been for years – for what is needed, what Gov. Granholm rightly calls "a grand bargain." Namely, a mix of structural reforms and wholesale tax reform. The governor's Emergency Financial Advisory Panel (EFAP) – certainly one of the most distinguished advisory groups in recent history – called for this three years ago. Other groups including Business Leaders for Michigan and The Center for Michigan have called for similar steps.
But their proposals have been routinely ignored. By whom?
Disgracefully, by Governor Granholm, who convened the panel. But their sound advice has also been ignored by Speaker Dillon, a Democrat, and Senate Majority Leader Bishop, a Republican.
Over the years, Democrats, including Granholm and Dillon, have argued that the state needs more revenue, now. Reforms, although they might be useful, would have to come afterwards.
Senator Bishop and his Republican chums have argued the reverse: spending cuts first (i.e. reforms), followed (maybe) by taxes.
So we've had stalemate. Yet, it shouldn't take a master's degree to see that the blindingly obvious solution to this standoff is to link structural government to an overhaul of our tax system.
In the sound of silence that so often substitutes for rational thought in Lansing, many Republican and Democratic lawmakers privately say this makes sense. But nobody has been prepared to step forward to say so. Feeling confident they won the budget fight with the Governor and the House last time around by sticking to a cuts-only budget, Republicans clam up when asked about what’s next.
And Democrats, uneasy that this election year seems to be shaping up favoring the GOP, are trying to whistle as they walk by the graveyard. Neither approach is a worthy substitute for leadership.
Granholm, Dillon and Bishop are all smart people. They know perfectly well that making a Grand Bargain is the only way out of Michigan’s repeated financial crises.
But, astonishingly, they have yet to do anything about it.
All three also are well aware that their behavior while in office calls into serious question whether they will be seen as leaving any positive legacy for the time when they were running the state.
Both Dillon and Bishop are running for higher office this year — Dillon for governor; Bishop for attorney general. At some point both are going to have to explain how their records in their current offices should give us any confidence they deserve promotion. They are going to have to do acrobatics to duck taking the blame.
Meanwhile, Granholm faces the risk that her two terms will go down as among the most disappointing in state history.
Ironically, all three say they ran for their present offices because they wanted to help Michigan. Well, now is the time to demonstrate that they remember that, as public officials, their first responsibility lies with helping our state and our citizens.
Too often, they appear to have preferred to follow – or defer to – meaner partisan instincts. They should have been dealing with our state’s long-term problems during all their years in office.
But instead, they – and far too many lawmakers from both parties – have spent their time in office ducking, weaving, kicking the can down the road, spinning, dissembling, blaming others. That is embarrassingly unacceptable, especially at a time like this.
We have no more than two months for them to find their way to a grand bargain before the partisanship-above-all instinct that accompanies an election year completely takes over in Lansing.
Rabbi Hillel, the famous theologian once asked two questions that should be central to any person’s moral code: "If not me, who? If not now, when?" Here's hoping Granholm, Dillon and Bishop will remember that when they look at themselves in the mirror.
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 bipartisan centrist think-and-do tank which is sponsoring Michigan's Defining Moment, a public engagement outreach campaign for citizens. The opinions expressed here are Power's own and do not represent the official views of The Center. He welcomes your comments at ppower@thecenterformichigan.net.
9 Comments
Phil,
Let's face it. We need more than "good smart people" in Lansing. We need sincere and courageous, unselfish, dedicated Leaders who actually care about the People of Michigan. We need some politicians with the GUTS to step up to the plate and do "the right thing for the right reasons."
Who knows, maybe after this election, we'll find more than a handful who appreciate the fact that it's the People they serve, not the political Parties or Special Interest groups.
Good article…..thanks for all you do!
Well said Mr. Power. We haven't had any one in control in Lansing for so long that hasn't put this state ahead of their personal wants and party politics. We need statemen not politicans.
I have been truly disgusted by all three of these people in their leadership position. I have never seen such a group of morons in my life. Bishop's plan to cut everybody's salary in the state by 5%, freeze their salaries for three years, make the state workers and school personnel pay 20% of their premiums and decimate health care for Medicaid clients is the usual Republican mantra. All the while he is cutting pay for everyone in the state, Mike will not take any kind of pay cut and, will enjoy his Cadillac health plan now and all through his retirement, is the usual out of touch position by our leaders in Lansing today. All of these clown need to be voted out and clean house. This is the sorriest group of politicians I have ever worked with in my entire time in the state of Michigan.
I agree with Bishop's plan for a 5% compensation cut and 20% contribution for health benefits. The problem is when something like this is suggested it's slammed by the opposite party. My question is what have Granholm and Dillion offered as a fix ? Besides increased taxes !
Phil,
Your continued attempts to be a centrist continually cause you to compromise on the truth. The idea that Governor Granholm (yes, my wife) has "disgracefully" ignored the committee she set up is flat out wrong. Have you read the report lately? Or followed Lansing politics? Start with the latter:
Senator Bishop as you well know has been 100% ideologically opposed to any tax changes and remains so. That is indisputable. The report you reference documents in huge, long detail how Michigan's tax revenue has declined year over year (even without the recession). Senator Bishop seems to want no part of understanding this.
Governor Granholm proposed a tax shift – one much like the Business Leaders for Michigan are today talking about, and which she and Dillon are meeting on – about 4 years ago. It was quite consistent with the report you say she "disgracefully" ignored. She continues to call for a shift to services that will be more tenable and fair. Am I wrong?
The report you laud also calls for corrections reform which she has been doing consistently for years, balancing safety with budget issues. Who fights this year after year? It's not Dems in the legislature, Phil. Is she afraid to take a stand? Against the soon-to-be-fear-mongering opponents? NO. Against correction workers who do very hard jobs? No. So how about a little of that truth here?
Jennifer has made numerous cuts to the state budget. There are about 10,000 less employees since 2000. So, Phil, maybe a little truth. I think your opinion is the real disgrace here. You're smarter than that.
Why are you so afraid to admit what is so obvious: that it takes two to tango, and Senator Bishop has steadfastly refused to take any position than the one described above by T. Allen? Do public workers need to sacrifice – as they have with furloughs and pay freezes? Yes, everyone needs to pay a price. But it's not like they're not, Phil.
You may have noticed that auto sales went from 17 million a year to about 9. Perhaps you also noticed that GM and Chrysler and Delphi and Lear? and….went bankrupt. So, revenues have gone down and will be a long time returning. Suggesting that we're back in the situation we're in SOLELY or even primarily because of Lansing – as opposed to a Great Recession is also just a bit misleading, no?
My wife has never been an ideologue, but has been a pragamatist. She appointed that bi-partisan group. She works well with many many republicans. Ask Hillegonds. Oh, for the days of Sikkema. Ask most in the business community.
Bring on the reforms. Put the heat where it belongs . . . on those who refuse to approach the table or dance floor.
Your admiring and disappointed friend (in all honesty),
Dan
Another Rabbi is worth quoting: Abraham Heschel, co-marcher with Rev. King, said the "opposite of good is not evil, it is indifference." It's time to act.
I remember one thing that a lady said on one of defineing moments meeting. I want it all I want it now and I don't what to pay for it. That is what happened in the past but this is the future. I am sure if we work for it we can have all we need and some of what we want but we need to start paying for it.
Dan, I realize your wife inherited a set of circumstances that were not caused by Governor Granholm’s agenda. While she seemed to think a socially progressive environment would make our state an attractive place to live and create jobs, she got thrown a curve ball.
The national economy tanked. The manufacturing industry exited Michigan in mass. The unfunded legacy costs for retired public employees continued to pyramid. The state’s portion of Medicaid continued to rise at rates substantially above inflation. We put too many people in prison….
You could go on and on listing the things that have roots to previous administrations.
But the facts are that these circumstances did occur while your wife was governor. As governor, it was her duty to deal with situation she was confronted with. Instead, she dug her heals in, and protected the base, which were the public employee unions. And she avoided any new proposals to cut the cost of Medicaid, prisons, or public employee retirements.
She will leave her term limited office with the state nearly bankrupt, and in need of massive budget cuts. She kicked the can down to the next administration, and as a result history will probably judge her as a bad governor.
And what of Governor Engler? What was his legacy? Taking a surplus and turning it in to a deficit by the time he left office, slashing anything that remotely helped people in the State and protected big business at all cost, took away people's rights to fair settlements when seriously injured so that insurance companies were protected at all costs, took away people's right to sue drug companies when someone died at the hands of a tainted product to save big business pharmaceutical companies, became involved in more environmental disasters by appointing the DEQ to over ride any environmental interests to protect big developers (Our Bay Harbor mess is a prime example as our leachate problem is an environmental disaster meant to last centuries), etc. The beer tax has not been touched in 40 years all the while the costs for treating alcoholism have continued to soar though treatment was never a priority. Instead John Engler left a legacy of building prisons in record numbers so that our costs for incarceration exceed our costs to educate people in Michigan. Don't worry Michigan; if we turn them in to idiots by not investing in education we can always lock 'em up. This state is a disgrace and we get what we pay for. It's obvious by our tax policies that we are not willing to pay for much. Except the lawmakers cushy benefits and retirement packages complete with health care for life. Wake up Michigan as we are in a race to the bottom with Mississippi and I think we are winning.
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