Things to watch for in Gov. Jennifer Granholm’s state budget message later today:
1. WHAT IS HER FUTURE-ORIENTED GOVERNMENT STRATEGY? Across-the-board cuts of all departments might suggest she doesn’t have one. Surgical cuts, or clear choices of winners and losers, will suggest the kind of budget backbone and leadership the state needs.
2. WILL THE GOVERNOR USE THE BUDGET AS AN INSTRUMENT OF REFORM? Rumors suggest major cuts and cost-saving reforms may be in store for the state prison system (as urged by a diverse coalition of business, education, nonprofit and local government groups.) How far will she go?
3. WILL PUBLIC EMPLOYEES GET A PASS? As unemployment rises and the private and nonprofit sectors absorb blow after blow, state employees have continued to earn raises and receive gold-plated health care coverage negotiated quietly in the last budget crisis nearly two years ago. The governor has suggested more sacrifices are on tap for state workers. What does she mean?
4. WILL EDUCATION AND GOVERNMENTS GET HAMMERED? If the budget cuts revenue sharing and per-pupil funding, will the cuts also come with reforms to costly state laws which require binding arbitration for labor contracts and put clamps on local government and school efforts to collaborate and share services across boundaries?
5. WILL SHE PROPOSE THE TOUGH CHOICES? The budget deficit this year is roughly $1.4 billion. The Center has listed more than that in possible budget savings from challenging, painful reforms and spending cuts in many areas. How many of these ideas will the governor take up? Or, will she and her team propose better approaches to close the budget gap?
6. WILL SHE SETTLE FOR SYMBOLISM? The proposal for a future 10 percent pay cut for many elected officials and judges is a hollow, symbolic, counter-productive gesture that saves a drop-in-the-bucket $10 million out of a more than $9 billion budget. Likewise, cuts to the current public arts funding of $7.9 million would cost local jobs in many communities, contradict the governor’s “cool cities” initiative, and do next to nothing to close the budget gap.
We’ll be back next week to sum up the reaction from pundits, interest groups, economists and the like. Stay tuned!
2 Comments
I would like to take issue with Mr. Bebow’s clearly biased view of the benefits and compensation earned by state employees. The implication of his comments suggest that state employees have not sacrificed over the years in Michigan’s many fiscal travails. Nothing could be further from the truth.
As noted in the Governor’s budget message, the state has 17 percent fewer employees than it did in 2001 and employees have twice agreed to make concessions, including increased health insurance premiums and unpaid days off. In 2008,
Michigan was one of only two states to provide no pay increases to its employees.
In most of the past difficult budget years, state employee pay raises were non-existent or were lower than the rate of inflation, resulting in a defacto pay reduction, while the Legislature had no problem allowing itself a 46% pay increase which they have never reduced. And in some years, like 2007, while state employees received a 3% raise, at the same time they absorbed a 7% pay reduction through unpaid work days and mandatory furlough days, with the end result being a 4% pay reduction.
Michigan has the 44th smallest state work force per capita in the nation and the pension multiplier, for the few employees still remaining in the old, being discontinued, defined benefit pension system is also the 44th lowest in the nation. Health insurance premiums have doubled, while deductables and copayments have increased, particualry within the prescription drug program.
I am not suggesting state employees should be imune from more sacrifice to address this serious fiscal time. But thoughtful observers should be less casual and more aware of the many sacrifices state employees have made over the years and continue to make while trying to provide quality service to Michigan citizens, always doing more with ever decreasing resources.
For an organization trying to encourage civil discourse in meeting the challenges of our state, I would expect a more moderate and thoughtful tone from your editorialization.
All these should be explored as well as any suggestion from the Mackinac Center or any other reasonable source. Sacred cows should all be slaughtered!
We should also engage a couple Six Sigma Black Belts to reform our processes to cut out waste.
Its time to get serious about reforming our governance system.