Fix Wayward State Spending Trends

March 3, 2008
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A study came off the presses last week to reconfirm Michigan’s woeful standing in setting priorities for state spending. Identifying the problem is a matter of routine. It’s time to go beyond documenting the troublesome numbers. To achieve solutions, the implementation of across-the-board outcomes-based budgeting must firmly take hold in the current round of legislative debate and negotiations.

Michigan is one of just four states to spend more money on prisons than higher education, according to the Pew Center on the States. Michigan spends $1.19 on corrections for every $1 spent on public universities and community colleges. Only Vermont’s ratio is higher. Forty-five states spend more on higher education than prisons. One state is spending the same amount.

Prison spending is driven by increasing inmate populations. Sentencing guidelines must be adjusted to bring Michigan in line with other states. That should be a relatively simple fix but nothing is easy in these politically charged times in Lansing. Excessive spending for other programs, including social services, also has impacted funding priorities.

The focus of state leaders must be on the budgetary impact of these out-of-whack spending trends on other crucial programs. Education support, for the K-12 level and beyond, will be a major area that will continue to suffer if these challenges are not dealt with effectively.

Currently, projected Michigan School Aid Fund revenues for the fiscal year 2008 would decline by $135.8 million. That will still leave a total of more than $11 billion in the fund. That money should be spent on programs, personnel and services that can justify their existence and performance with strict outcomes-based criteria.

It’s clear the state’s higher education system is a key component of economic strategy going forward. A solid financial base of support is crucial to support long-term stability. A report issued by Michigan Future Inc. noted West Michigan’s reliance on lower-paying jobs that don’t demand a college degree. This area ranked 51st among the 53 metropolitan areas studied for concentration of high-educational attainment jobs. Michigan Future indicates the top areas of growth will be information; finance and insurance; management of companies; professional and technical services; and health care and education.

The priority should be to hone the talent of today’s students to meet these burgeoning skill sets. That requires establishment of a pinpoint spending strategy from the public sector to support learning. Now is not the time to cut spending in these areas. It’s about time that realization strikes home and becomes a matter of routine. Without such an approach, the studies will keep on coming, documenting how far short this state is falling in the global pecking order.

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