Engler Cuts Likely to be RejectedBy Jim
Jacobs
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Gov. John Engler's razor-thin election victory in November (his 19,000-vote victory was less than 1 percent of the votes cast), didn't dissuade him from applying his supply-side, free-market ideology to the state budget. In addition to cutting 9.2 percent from all departments across the board or a total of $536 million in the fiscal 1991 budget, Engler plans a second round of selective cuts totalling $475 million. One of those cuts would slash almost $32 million from the state's $49.7 million equity package, gutting Detroit's share of the package. The equity package is money the state pays cities to subsidize cultural institutions. Detroit's $38.3 million share goes toward such institutions as the Detroit Institute of Arts, the Detroit Symphony Orchestra and the Detroit Zoo. However, the state Department of Commerce was hit with the greatest percentage reduction &emdash; $69 million out of about $114 million, or more than 50 percent. The state House and Senate Appropriations Committees will have the final say about whether Engler's cuts will be accepted or rejected. Their deadline for doing either is Jan. 26. As a leader of the Detroit legislative delegation and chairman of the Regulatory Subcommittee of the House Appropriations Committee, state Rep. Morris Hood Jr., D-Detroit, will play a pivotal role in those decisions. As Hood sees it, Engler's cuts would come at the expense of the state's poor and working people. Hood vows to fight the proposed cuts. As important as that is, so is developing a strategy for Michigan's long-term recovery. For the last 15 years, the auto industry has faced intense international competition which has made job retention, let alone growth, very difficult. As a result, real wages in Michigan have not been rising, and plant closings have torn the fabric of many industrial communities like Flint and Detroit. The Blanchard administration gave some recognition to manufacturing's significance with the development of administrative programs, such as the Michigan Modernization Service &emdash; the largest state effort to provide technical assistance to small and medium-size manufacturing firms. But many progressive legislators believe that Engler's proposed budget cuts symbolize a new "low road" to economic growth. This recycled Reaganism &emdash; now rejected at the federal level &emdash; will stress cheap property taxes, low wages and no benefits as the means to promote capital investment for growth. Engler critics, such as Hood, claim this approach will create more poverty and hardship for people on the bottom, while doing little to move the state forward. METRO TIMES: If implemented, what would be the effect of Governor Engler's proposed selective budget cuts? REP. MORRIS HOOD: It would be disastrous to the entire state &emdash; not just urban areas. With budget cuts such as the new governor is proposing, complete chaos will occur in this state, from social services on upwards. There's no doubt that there's a deficit, and in these days of dwindling dollars, I think all departments will have to accept some reduction. ... We're into a different phase now from the first round of 9.2 percent, across-the-board cuts. This is for an additional $475 million. He's really in essence saying that he's pretty much going to wipe out the equity package to the city of Detroit. We estimate that Detroit's share of the cuts will come to approximately $43 million &emdash; that's money that goes to the Detroit Public Library, the Detroit Institute of Arts. Outstate, the cuts come to about $6.6 million. What we've been able to do is compile statistics from all the cuts to various departments &emdash; we figure Detroit is going to lose, from all departments including Social Services, we're talking about $104 million in all. We're talking about 9 percent of the city's budget. MT: How do you plan to fight the proposed cutbacks? HOOD: We have till Jan. 26 to act, but we're going to act on (Jan.) 23 ... at the House Appropriations meeting. We're going to reject the governor's executive order (proposing the second round of selective cuts). The Appropriations Committee of both the House and Senate have to accept the cuts or they're dead in the water. Which means he'll have to resubmit (a revised round of) proposed cuts to the Appropriations Committee &emdash; the full Legislature doesn't have to vote on this &emdash; within 30 days. The governor has to come back within 30 days with a new proposal; then we go through the same procedure. He said very clearly that he's willing to negotiate. ... The Republicans are in control of the Senate, so I think they'll be supportive of any proposal of the governor's. After (the House committee) rejects his proposal on the 23rd, that gives us 30 more days to negotiate. We're fully cognizant of the fact that these reductions have to take place. We don't question there's a $1.1 billion deficit. The question is how those cuts take place &emdash; they have to be fair and equitable. The governor has just gone in and slashed &emdash; he's really taking a meat-cleaver approach. ... The House Appropriate Committee will conduct public hearings on the proposed cuts throughout the state. (The first one is from 9 a.m.-noon, Jan. 23 at Wayne State University's McGregor Hall in Detroit.) There will be hearings over the next week and a half. MT: Engler's proposal is to refrain from cutting education directly. Do you think this is part of a strategy to divide education from other human service interests? HOOD: I couldn't say it more eloquently. He's playing with the fears &emdash; he's playing to the suburbanites by talking about a property tax reduction. He's going to have to find some (state) revenues to pay for the property taxes he reduces. We're going to have to find some way of paying for the property tax reduction, but not on the backs of poor, inner-city residents in Detroit. ... But progressive legislators &emdash; the word "liberal" is taboo &emdash; would have to explain to middle-class (voters) why they're helping the poor and working class in Detroit rather than giving them a property tax reduction. This was calculated on the part of Engler. But we have the deficit we have right now because the Blanchard administration didn't level with us. The Blanchard administration thought the economy would improve. He said he was leaving office with a surplus, and that's not true. I think all departments are responsible &emdash; we can't lay it all on Blanchard. The entire Michigan Legislature has to share the problems we're encountering. And then, also, the whole economy is on a downturn. There are a number of factors that play into this. MT: Many of us are puzzled by the political understanding of Governor Engler and his staff. Can you say something about his remark that appeared in the Jan. 17 Detroit Free Press, that those people on General Assistance "will have to look in the papers and elsewhere for jobs"? What is the thinking behind this? HOOD: That's Engler's mentality. It's just simply insensitivity to the working people in the Northeast and women. Look at Ronald Reagan &emdash; he was governor for eight, nine, 10 years, then he became president. He had the same philosophy. It's who you surround yourself with. Engler is bright &emdash; he's no dummy &emdash; but he has surrounded himself with people who don't understand the complexity of this nation they live in. MT: How do you think Engler perceives his responsibility to the citizens of Detroit and the black community? HOOD: I think John Engler has to recognize the fact that he's governor of the entire population of the state, instead of protecting the interests of the well-to-do. The property tax is an example &emdash; we certainly need property tax relief, but not on the backs, on the hides, of the poor and working class.
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