Gov. Jennifer Granholm finally moved toward real leadership last week, seven years and six weeks after taking office.
With state government facing its most dangerous financial crisis ever, she moved to try to save education, our hope for a better future, from being crippled or destroyed by the politics of inaction.
The bottom line is this: Michigan government faces a deficit of at least $2 billion for the year that starts next fall. The state has been cutting workers, programs, and spending for years. This time, either the state has to find new revenue — or make huge cuts to not only both elementary and high school education, which took a big hit last year, but to higher education as well.
That would mean huge tuition increases at every university in the state, which would mean fewer students, especially at places like Wayne State University, where I teach. Nearly all my students have to work. They are struggling to earn their degrees to make better lives for themselves and their families, and just making it as it is.
With fewer students, the schools would have to sock it even harder to those who are left ... which means more would leave. Incidentally, a budget without new revenue would mean an end to revenue sharing too. Meaning more trouble for our troubled cities, followed by cuts to Medicaid and other programs. Now the Republicans, led by the cynical, sneering careerist Mike Bishop, the Senate majority leader, are flatly against any new money for the state.
They want to bring the Democrats down, and couldn't care less if they take the state down with it. Bishop has proposed, for example, cutting pay and benefits for every state employee, including professors, which probably would have the effect of driving all the real university stars to take new high-prestige jobs out of state.
Here's what the governor is proposing instead. First, she did take out the hatchet, proposing more than $500 million in cuts, a burden that would fall heaviest on state workers. Many who have given long and faithful service would be virtually forced to retire.
But to protect education, she is proposing a reality check long overdue. Michigan has been becoming a service-based, not a manufacturing-based economy for years. She would lower our overall state sales tax rate from 6 percent to 5.5 percent — but extend it to most services. Right now, if you buy a tailpipe for your car, you pay sales tax on it. You pay Harry's Muffler Shoppe to stick it on, you pay no sales tax. That sounds sort of crazy, because it is.
Now you might ask — how do we know the money really would go to schools? Her bill would require it to be used to make up the shortfall. Once that's done, the sales tax money would then be shifted to phase out the stupid surcharge the Legislature slapped on the Michigan Business Tax in 2007. So by boosting the sales tax, we would help our future in two ways. First, by preserving education. Second, by helping make Michigan a place more attractive to businesses.
So, hats off to the governor. For years, I have been severely criticizing Granholm for failing to have the guts to take bold and necessary steps like this. Finally, she has done it. That doesn't redeem her largely squandered legacy. This would have been far easier to do three years ago. Nor did she do it perfectly this time.
The governor should have presented her plan in the State of the State speech, and explained to the citizens why it was necessary. But she used that mainly for happy talk and a mind-numbingly boring recitation of how a few people got new-economy jobs.
Yet in the end, on taxes, she did the right thing. But her plan is almost certainly going to fail in the Legislature, perhaps without a real hearing, unless a lot of people mobilize quickly to see that this doesn't happen. The Republicans slammed it, as expected.
But what is far more dismaying is that Speaker of the House Andy Dillon, himself an all-but-declared candidate for governor, appeared to be denouncing the plan too. According to the Gongwer news service, Dillon bizarrely said, "We've got to do everything we can to get this budget done within the dollars that we have and not do that just to find some new revenues now."
That makes no sense. Dillon himself told me in person two months ago that the state had to find new revenues this year, or education funding as we know it would be destroyed.
Playing politics is a fine sport, but this sort of thing has been destroying our state for years. Yes, income tax increases are in some ways better than sales tax increases, but bizarrely, many lawmakers would find it politically easier to enact a sales tax. Why?
Simple. They can say that a sales tax, even on services, is voluntary. Income taxes aren't. Now, progressives and others with a conscience hate the sales tax because it is "regressive," meaning it takes a higher percentage of income from the poor. They want to fix the state's finances with a graduated income tax instead.
Works for me. Unfortunately, the Michigan Constitution, written largely by Republicans, forbids any graduated income tax. We can and should rewrite or amend it, but we can't in time for this year.
What if the governor's plan is not approved? More gridlock and stalemate, followed by either crippling cuts, a government shutdown ... or both. Any of those things would do more damage; drive more young people away. All of us need to stand and fight for Michigan's future, and here's something all of us, and President Obama too, need to know: We're a hell of a lot more important than Afghanistan.
Get under the Dome: Ever feel helpless when it comes to trying to figure out what's going on in Lansing? State government really affects most people more than the local or the federal varieties. But trying to make sense of it isn't easy.
Who are the players? What are their real motivations? Why do they vote the way they do (i.e., to break their promise about the Michigan Promise grant, etc.) The "daily" newspapers barely cover Lansing anymore, certainly not in depth, and don't even get delivered daily. Well, the best, easiest and most painless way to follow this stuff is also the cheapest – absolutely free. Check out Tom Scott's impressive Dome Magazine online: domemagazine.com.
Scott, an elfin man with a puckish sense of humor, left so-called conventional reporting years ago to serve as press secretary for former Gov. Jim Blanchard. "But I never really got journalism out of my system," he says. So a little over two years ago, he founded Dome, for which he is both editor and publisher. The magazine has attractive graphics and excellent articles by some of the state's best political writers, Lansing's best columnists, and tons of insights. Check out, for example, Susan Demas' absolutely first-rate profile of Andy Dillon.
What it doesn't have is enough readers; like many first-rate journalists, Scott is lousy at marketing his own product. Dome, whose slogan is "covering the people, issues and events shaping Michigan politics and policy," ought to be checked out by anybody who cares about who these people are, and how we got into the mess we are in.
Besides, if we don't figure this stuff out, we won't have a prayer of avoiding getting screwed over even more, let alone fixing things.Jack Lessenberry opines weekly for Metro Times. Contact him at [email protected]