Reinvention cant involve same old faulty approaches

November 8, 2010
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It’s a new day in Michigan … or is it?

Though voters last week saw fit to change the guard in the Michigan House and Senate, in West Michigan it’s more a story of mostly the same guys in different seats.

In fact the biggest change last week was in Grand Rapids, when City Manager Greg Sundstrom reported that the city’s $33 million deficit was now a $33,000 surplus after layoffs, merging 24 city departments into 17 — and a voter-approved temporary income tax increase. It is likely the state will take similar actions. The budget deficits in governmental units across the state, however, would be less severe if revenue sharing dollars were returned to local units of government, as is the state law and which is currently ignored by the legislature. This is particularly important as the state continues to make cuts that result in unfunded, additional financial burdens as municipalities are forced to cover what the state has not.

A Republican will become governor, but Rick Snyder’s transition team isn’t new, either. The trio was Republican Gov. John Engler’s economic architects who left deficits — and deteriorating roads. Former state treasurer and budget director Mark Murray and former economic development director Doug Rothwell both also served to create Business Leaders for Michigan, which actively campaigned to support Snyder.

Once again, the governor of the state has no legislative experience, but one could argue there is little of such experience with so many “freshmen” in either state Chamber. While Snyder was elusive in regard to exact plans to cut state deficits, his transition team members were authors of the Business Leaders for Michigan Turnaround Plan.

The Business Journal has supported many elements of that plan, but urges caution. Taking another page from Sundstrom’s notes, income tax receipts are beginning to stabilize. Those receipts were expected to drop another 8 percent this year (following a 9 percent drop in 2009), but through October of this year receipts are down just 1 percent. Draconian action may not be necessary as thought prior to the launch of candidate races in Michigan’s most dismal year in recent history. Responding to current conditions has not been government’s forte; it lags in real time and offers too little too late.

Another caution is this: Government does not create businesses or jobs; business owners do. Snyder knows this well, and his most important work will be to get out of the way and reduce the tax burden in a state that has been most crippled as manufacturing takes a back seat to a new economy. The best way to enhance the new economy is to provide an educated work force.

In truth, these changes were beginning to take place even during the Engler administration years, and the team knew of the sea change.

It is a new day in Michigan … or is it? Perhaps it can be, with hindsight and reinventing government to get out of the way of the progress of Michigan businesses. Newly elected leaders and especially Governor-elect Snyder must know: It’s no longer about you.

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