I hate to tell you this, but as of now, resolving the state’s budget deficit looks as though it’s going to be just as much of a mess as it was back in 2007, when Michigan was shut down for a few hours and our legislative leaders were reduced to attempting to tax the bronzing of baby shoes, and negotiating by text messaging.
The problem lies in the fiscal year that starts October 1, when Michigan will be facing a $1.5 billion deficit in the $9 billion general fund, (give or take a few hundred million.)
Whatever anyone tells you, nobody yet knows in detail what all the Obamabucks from Washington will really mean for Michigan, although some lawmakers are hoping the stimulus plan will give them a way to wriggle out of some tough decisions.
But our state constitution says we have to have a balanced budget, so the fat’s in the fire, no matter what. And things are, if anything, grimmer today than they were 18 months ago. The nation’s worsening economy is beginning to look like the 1930s.
Michigan’s unemployment rate just broke into double digits and likely to go higher. Auto sales are as weak they have been in a generation, getting weaker, and Chrysler and General Motors are on life support and facing possible bankruptcy filings.
With all this as backdrop, Gov. Jennifer Granholm last week proposed her own 2010 budget , which includes, among other grim statistics, cuts of $670 million, laying off 1,500 state employees and a $59 per pupil cut in the state school foundation grant.
Nobody was particularly enthused. “We applaud Gov. Granholm’s recommendations that address several of the budget reform principles we have previously called for,” said Detroit Renaissance President Doug Rothwell. “But this budget still relies too heavily on one-time budget cuts versus structural reforms.”
Actually, his remarks were more restrained than most.
Universities howled at their proposed 3 percent cut — especially since the governor openly asked them to freeze tuition. The public schools worried about losing $50 million in earmarks, plus the reduction in state per pupil support. State workers grumbled at the layoffs and the $28 million in unspecified employee concessions.
Prison guards, naturally, were unhappy about the $120 million reduction in corrections spending.
What everyone did agree on is that repeating the budget fiasco of 2007 would be awful beyond belief. Yet the iceberg is approaching, closer and closer each day. Still, it doesn’t have to be that way
All our state leaders need to do is just remember some lessons from that horrible mess. Most important: Don’t start by haggling over the details of budget cuts and tax changes without spending time on developing a shared vision of where the state needs to go.
Without a common ground vision for the state’s future, nobody can possibly develop a set of policy initiatives that help get us there. And without that, it’s simply impossible to come up with a focused and disciplined set of tax and spending practices that fit the vision.
What should be fundamentally clear is that if you don’t have a clear vision, you don’t have any way of weighing what’s important against what’s less important. That means you’re reduced to the mud wrestling over contending details and the reflexive partisan finger-pointing that were so embarrassing to everyone back in 2007.
The Michigan’s Defining Moment campaign over the last couple of years has held hundreds of community conversations throughout Michigan, where small groups of citizens worked out a common vision for what kind of state they wanted to have.
What they came up with was pretty straightforward:
* A talented and globally competitive workforce.
* A vibrant economy and great quality of life.
* Effective, efficient and accountable government.
Our lawmakers should consider working with these thoroughly non-partisan principles, developed from the bottom-up by hundreds of Michigan citizens. That might well offer lawmakers and the governor a useful framework for digging us out of our budgetary hole.
The future of our state is now clearly hanging in the balance, and it’s a terrible – because so deeply irresponsible – thing to fall back into easy habits of ideologically-driven partisan bickering.
Governor Granholm recognized in her budget message that things are so serious that things can never be the same.
She acknowledged that the very structure of government needs to change, and that we can no longer put beginning the transformation of our state that we all know must come.
One good place to start would be to bring together around the big table in the governor’s office on the second floor of the Capitol the Speaker and Minority Leader in the House of Representatives and Majority and Minority Leaders in the State Senate.
There, everyone should talk about developing a shared vision for Michigan’s future. They should make that vision the guidepost for organizing work on the budget. That doesn’t mean there wouldn’t be plenty left to legitimately argue over. But it would do something:
Give them, and us, a much better chance of avoiding the nationally embarrassing and politically and financially damaging mess that they put us all through, less than two short years ago.
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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. He welcomes your comments at ppower@thecenterformichigan.net
