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November 13, 2008 – 2:12 pm
Almost a year ago, a statewide poll told us that more than eight in ten state residents viewed bipartisan cooperation in Lansing as very important. Yet only 5 percent saw solid evidence of Republicans and Democrats working together.
Well, dozens of new state representatives are heading to Lansing in January. We met with more than three dozen of representatives-elect in the past four months. They've already taken a near-unanimous vote to work in a bipartisan fashion.
"The future of Michigan is not a partisan issue, you have to be able to work with everyone for positive change," Dan Scripps told Center for Michigan outreach coordinator Nancy Short way back in July when they met at an ice cream parlor in Ludington. Scripps, a Democrat from Northport, is heading to Lansing.
John Walsh, a Republican from Livonia, is a new state representative, too. A self-proclaimed "MDM poster child," Walsh ran on a message of business attraction and retention, inveting in education, smart budgeting and bipartisan cooperation.
The following people who participated in Michigan's Defining Moment forums, meetings, and televised debates during the campaign will occupy seats in the state capitol come January. We wish them well. And, on behalf of the thousands of people across Michigan who are part of the Michigan's Defining Moment Campaign, we want them to know we're watching to see if campaign words are matched by legislative deeds....
Timothy Bledsoe, Democrat, Grosse Pointe
Fred Durhal, Democrat, Detroit
John Walsh, Republican, Livonia
Marc Corriveau, Democrat, Northville
Dian Slavens, Democrat, Canton
Doug Geiss, Democrat, Taylor
Deb Kennedy, Democrat, Flat Rock & downriver
Sarah Roberts, Democrat, St. Clair Shores
John Switalski, Democrat, Warren
Marie Donigan, Democrat, Royal Oak
Ellen Cogen Lipton, Democrat, Ferndale
Lesia Liss, Democrat, Warren
Vincent Gregory, Democrat, Southfield
Vicki Barnett, Democrat, Farmington Hills
Hugh Crawford, Republican, Novi
Lisa Brown, Democrat, Commerce Township
Harold Haugh, Democrat, Eastpointe
Gail Haines, Republican, Waterford
Cindy Denby, Republican, Howell
Richard Hammel, Democrat, Flushing
Lee Gonzales, Democrat, Flint
Larry DeShazor, Republican, Portage
Kate Segal, Democrat, Battle Creek
Jase Bolger, Republican, Marshall
Martin Griffin, Democrat, Jackson
Mike Simpson, Democrat, Eaton Rapids
Bill Rogers, Republican, Brighton
Mike Huckleberry, Democrat, Greenville
Justin Amash, Republican, Kentwood
Robert Dean, Democrat, Grand Rapids
Sharon Tyler, Republican, Berrien County
Bob Genetski, Republican, Allegan
Joe Haveman, Republican, Holland
Mary Valentine, Democrat, Muskegon
Jim Stamas, Republican, Midland
Wayne Schmidt, Republican, Traverse City
Andy Neumann, Democrat, Alpena
November 13, 2008 – 1:25 pm
Michigan faces "dire" consequences -- including a loss of 17,000 more jobs, billions in federal matching funds, and lost global competitiveness -- if it doesn not double its investment in infrastructure, a bipartisan Transportation Funding Task Force reported this week.
The dozen and a half possible fixes include the first general increase in fuel taxes in more than two decades or a new price percentage tax rather than the flat, per-gallon tax used now.
At the same time, another bipartisan coalition called Get Michigan Moving is actively pushing for numerous mass transit bills to clear the Legislature.
November 13, 2008 – 12:48 pm
Well, maybe with Washington taking an ownership stake the Big Three will stay afloat. Maybe not.
Either way, in the shadow of those wobbling silos, a diversified, entrepreneurial economy is sprouting.
Check out these Michigan trends from the Edward Lowe Foundation's youreconomy.org...
Between 2005 and 2007, Michigan:
Gained 30,000 new business establishments (a net increase of 5.7 percent).
Lost 2,167 business operations that were not headquartered in Michigan (a net loss of 8 percent)
Gained 49,429 small, and often entrepreneurial, businesses with nine or fewer employees. Those businesses resulted in a net small business employment gain of 144,316 new jobs.
"Expanding companies are the linchpin for job growth," said Mark Lange, executive director of the Edward Lowe Foundation. "This is especially true when compared to the jobs gained from opened or relocated companies. "We're not saying that recruitment is wrong, but there has been an overemphasis on these activities due, in part, to competitive and political pressures."
Consider, too, the still-robust tech sector in Southeast Michigan, as documented this week by Automation Alley's technology report showing recent gains in advanced manufacturing and life sciences...
"In spite of the fact the entire automotive industry has declined, Southeast Michigan still has one of the highest concentration of technology jobs in America," Ken Rogers, executive director of Automation Alley, told Metromode. "Our workforce makes us incredibly unique, and it will lead the region and state out of these difficult times. Talent, I believe, is the next economic development arena over infrastructure - and we've got the talent required to take the region into a new economy."
Finally, take a gander at this....
It may not feel like it, but, even in the tough economy of the past three years, total personal income is up more than 10 percent (or, basically keeping general pace with inflation).
But... And it's a big but... That income growth is the slowest in the nation, according to federal figures....
November 13, 2008 – 9:55 am
Remember the near government shutdown in Michigan last year, which came after several years of budget cuts and strong calls to rewrite the state's business tax code?
So many other state's now know our pain, as the National Council of State Legislatures reports:
Previous NCSL reports indicate states closed a $40 billion budget gap in 31 states during legislative sessions earlier this year. Arizona, California and Nevada faced the biggest gaps. Preliminary figures now suggest a new fiscal year 2009 budget gap of $30 billion. "We think it's only going to get worse," NCSL fiscal affairs director Corina Eckl said. A December NCSL report will identify the full amount as it stands before state legislatures go into session in 2009.
NCSL Executive Director William Pound noted some states already have implemented hiring freezes, fund transfers and project delays. Several states, Eckl said, already are looking at budget reductions, with Nevada considering a 14 percent budget cut for the 2010 fiscal period. Many states already are tapping into their "rainy day" funds to help balance budgets.
Michigan Gov. Jennifer Granholm also warns of shortfalls just around the corner.
But the real whiplash this week came in a head-spinning revenue report from the House Fiscal Agency. Despite Michigan's economic doldrums, state budget revenues are up 8.2 percent this year.
Income tax revenues are up 12.7 percent thanks to the hike approved by legislators last fall.
Oddly, sales taxes (a measure of consumer consumption) are up 2.2 percent despite the economy.
But the real quake is business taxes. Total business tax collections are up 42.1 percent this year, thanks to the rewrite from the old SBT to the new MBT and a hefty surcharge passed by the legislature to balance last year's budget. Altogether, businesses are paying $834.5 million more in taxes this year than last.
And if you think business groups are going to take that sitting down, I have some bundled mortgages I'd like to sell you.
It might be time for the Granholm Administration and the legislature to dust off the many cost saving and structural reforms recommended almost two years ago by a bipartisan panel of state budget experts. To date, those reforms have been pretty much ignored in Lansing.
One of the nation's leading business strategists, Harvard guru Micheal Porter, just called for a greater business strategy in Washington. Perhaps his ideas are worth thinking about in Lansing, too. A snippet of Porter's thoughts...
We need a strategy supported by the majority to secure America's economic future. Yet Americans hear the same old divisive arguments. Republicans keep repeating simplistic free-market thinking, even though the absence of all regulation makes no sense. Self-reliance is preached as if no transitional safety net is needed. Some Republicans even argue passionately that the country should have no strategy because that would be "industrial policy." Yet the real issue is not picking industry winners and losers but improving the business environment for all American companies, something we cannot do without identifying our top priorities. Overall, Republicans seem to think business can thrive without healthy social conditions.
Democrats, meanwhile, keep talking as if they want to penalize investment and economic success. They defend unions obstructing change in areas like education, cling to cumbersome regulatory approaches, and resist ways to get litigation costs for business in line with other countries. Democrats equivocate on trade in an irreversibly global economy. They seem to think social progress can be achieved only at the expense of business.
To make America competitive, we have to get beyond this thinking. Political leaders, business leaders, and civil society must begin a respectful, fact-based dialogue about our challenges. We need to focus on competitive reality, not defending past policies.
November 13, 2008 – 9:18 am
So, in Michigan we passed medical marijuana use and allowed wider freedoms in stem cell research.
Nationwide, voters decided 153 ballot measures, including several with clear reverberation here in the Great Lakes State.
In 2010, Michigan voters will decide whether to try to rewrite the state Constitution for the first time in a half-century. Interest groups of many stripes would like a crack at rewriting all kinds of provisions. For example, in 2006, a bipartisan, volunteer group of distinguished citizens led by Grosse Pointe Attorney John Axe recommended 63 changes to the state constitution, including lengthening term limits for legislators and prohibiting non-residents from gathering signatures for petition drives.
Three constitutional questions failed miserably this year, as the National Conference of State Legislatures explained:
Fourteen states have automatic constitutional convention referenda in which voters periodically decide whether or not a constitutional convention should be called. Three states had automatic constitutional convention referenda on the ballot yesterday, and all three went down to defeat by wide margins. "Yes" votes were only 41 percent in Connecticut, 41 percent in Connecticut and 32 percent in Illinois. These results suggest that voters are not anxious to undertake wholesale rewrites of their constitutions and institutional structures.
Likewise, a proposal to repeal term limits in South Dakota went down in flames. The arguments for the proposal were almost exactly the same as what the Center for Michigan has heard regularly in Community Conversations across the state, as CNN reported:
Term limits "have decimated the legislative process," South Dakota state Sen. William Napoli said in fighting to remove the term limits ban after having helped institute it in the early 1990s. "I wanted to get the old guys out of there and get some fresh blood in. I wanted term limits worse than anybody... We've seen the results of term limits, and they have decimated the legislative process. They put too much power in the hands of the government, bureaucrats and lobbyists, and they've neutered the third branch."
Like many opponents of term limits, Napoli said they destroy the legislature's institutional memory by replacing experienced lawmakers with untested rookies.
"I've seen my legislative body turned into a circus, and I'm so sick of it. My heart is broken," Napoli said.
October 31, 2008 – 11:31 am
Quick links as you head to the polls next week...
1. QUESTIONS WE'VE ASKED STATE HOUSE CANDIDATES ALL FALL.
2. ANSWERS FROM DOZENS OF CANDIDATES IN OUR VIDEO FORUMS.
3. A QUICK ROUNDUP OF NEWS COVERAGE FROM OUR STATEWIDE CANDIDATE FORUMS
Battle Creek Enquirer
Crain’s Detroit Business
Detroit Free Press (Oakland Co. Exec. race)
Farmington
Grand Rapids Press
Greenville Daily News
Interlochen Public Radio
Michigan Daily
Michigan Public Radio
Michigan Youth Political Alliance
Northville -- http://www.journalgroup.com/Northville/8461/debate-set-for-20th-house-candidate
Traverse City Record-Eagle
WWJ Great Debates page --
October 31, 2008 – 11:13 am
Somewhere out there in Michigan's vast, $2 billion-a-year prison system, there is a guard who last year worked 2,390 hours of overtime and more than likely made more than $130,000 for the year.
That's 46 hours of overtime per week!!!
Another 120 guards averaged 20 hours of overtime per week.
Altogether, the Department of Corrections could save millions of dollars each year by effectively managing overtime costs, according to a state audit released last week.
Other savings could come from eliminating unusual prison guard perks like a $575 allowance for dry cleaning.
That's the level of detail it's getting to as a growing coalition of interest groups demand an end to the ever-growing prison budget trend in Michigan.
As we told you last week, prison overtime costs have doubled in the past five years.
In response to the new audit, the Corrections Department said its really doesn't control its own overtime decisions because those are governed by labor contracts negotiated and approved by the governor's administration.
"DOC informed us that its facilities monitor the amount of overtime worked by individual custody officers, but under current contract language, DOC cannot prohibit employees from working any given number of overtime hours, consecutive days, or double shifts unless they are determined medically unfit to do so," auditors wrote. "DOC informed us it will continue to recommend changes to the collective bargaining agreement between the Michigan Corrections Organization and the State of Michigan to provide DOC with greater control and flexibility in the scheduling of overtime and staffing of assignments."
October 31, 2008 – 10:35 am
Did you feel the economic tremor in Battle Creek this week?
There's growing buzz in Michigan over the state's long and storied labor history (we should, indeed, thank unions for bringing us paid vacations and the concept of a weekend). Does the state's strong labor climate drive away potential new business? Or, is that a straw-man argument from anti-labor types who chafe at unions' dogged protection of the average worker's ability to make a decent living in a dog-eat-dog world? Do private sector union workers have it tougher than public sector union workers? Should Michigan be a Right to Work state?
Rarely has all that debate morphed into the kind of clear choice faced this week by the the Battle Creek City Commission. They had an either-or proposition...
Waive the city's prevailing wage law and anger a strong contingent of local union workers.
Or...
Lose a new manufacturing plant and its promise of 350 new jobs.
The commissioners chose the jobs.
The path to that decision ilustrates the nuanced and changing economic development relationships as Michigan seeks to diversify beyond its traditional Big Three auto culture.
For starters, the Granholm Administration, always backed by Big Labor, pushed the deal for Battle Creek's new United Solar Ovonics solar energy manufacturing plant. The state granted a 20-year, $17.3 million tax break to keep United Solar Ovonics from building the plant in competing states. "We look forward to a continuing partnership with them as we work to diversify our economy and create new energy jobs," Granholm said in announcing the deal. Michigan Economic Development Corp President Jim Epolito added that the deal "validates our aggressive economic strategy and sends a clear signal to the rest of the world that Michigan is a great state to do business in."
When the deal got to Battle Creek City Hall, the company got more local tax breaks but the concern was that United Solar Ovonic would pay almost, but not quite, the full prevailing wage of $16 per hour. Union leaders wanted the commission to hold tight to its prevailing wage law and require United Solar to pay workers more and protect union contractors from losing plant construction work to outsiders.
Dave Adams, a retired union worker, confronted United Solar officials at a packed city commission meeting, as reported in the Battle Creek Enquirer. "When is enough enough?" Adams asked. "The city has bent over backwards to give you breaks. When is enough, enough?
Some sought a compromise or a delay in the vote. United Solar Vice President John Morgan promised a swift retreat right back out of Battle Creek to a more hospitable location. So, the commission approved the tax breaks and prevailing wage waiver. "We are the only true U.S.-based solar company in the world and it was important to us to invest in Michigan," Morgan told the Enquirer. "Four years ago, we grew from $23 million to $500 million in sales and we have added 1,800 jobs in Michigan. But we have to be fiercely competitive in a global market."
Both the Granholm Administration and Battle Creek commissioners chose the promise of new jobs over the pleas of labor for higher paying jobs.
October 31, 2008 – 9:37 am
Grand Valley State University has just published its second annual Accountability Report. As we first said a year ago, it's an excellent example for other public institutions to follow. The report holds GVSU administration responsible for annual measures like graduation rates, pass rates on professional licensing exams, and percentage of graduates retained in Michigan.
Michigan's universities make clear and compelling arguments that the state is falling behind in the national arms race that is higher ed funding. State taxpayers spend more on prisons than they do on universities. But the universities' case would be more compelling if each campus could publish the same kinds of transparency and results aimed for in the GVSU accountability report.
As unpleasant as recent years' funding has been on campuses, the situation could easily grow worse. And future legislators could very well move to new and tougher lines of inquiry in their budget talks with university presidents.
October 31, 2008 – 8:45 am
... the United Auto Workers are spending 45 percent less than two years years ago and the Michigan Realtors are spending 21 percent less than two years ago to influence Michigan elections.
This year's Top 150 Michigan PACs report from watchdog extraordinaire Rich Robinson offers other interesting glimpses of an economy in flux...
Comerica is pulling up stakes and moving the HQ to Texas, but the company's PAC fundraising in Michigan is up 3.6 percent over two years ago, to $439,000.
Teachers are feeling the pinch... The MEA's PAC fundraising is down 16.8 percent, to $945,000.
Folks must be drowning their sorrows because there's no sweat yet for the Beer & Wine Wholesalers, who've raised $716,000 -- 5.7 percent more than two years ago.
Others must be watching plenty of cable television. Comcast's PAC is up 83.7 percent, to $366,000.
It's been a good couple years for agriculture, and the Farm Bureau's PAC is up 60 percent, to $336,000.
A year ago, in the midst of the state budget meltdown, state workers got a three-year contract with modest wage increases and slight increases to health care co-pays. The AFSCME PAC suggests they're grateful -- it's up 59 percent to $220,000.
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