Tax and spend government squashes business opportunity

October 26, 2009
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Here we are again: Down to the time wire to approve a new fiscal year state budget even after voting to extend the deadline mandated by law for an extra 30 days. It’s the time we expect major mistakes in the rush for agreement. The agreement becomes the issue, not the facts that make budget decisions difficult.

Few people allow themselves to be bothered by the facts anymore, most especially Gov. Jennifer Granholm and House Majority Leader Andy Dillon. Some things don’t change — and that’s the problem — especially because the world of economic realities has changed.

Last week The Wall Street Journal made note, offering Michigan as an example to the nation of what not to do. The editorial flat out advised other states working through similar budget difficulties, “Steer clear of the Michigan model.” That’s not good for business in a state already “redlined” for business and banking investment. The nation’s business newspaper reiterated many of the same facts that have over and again been noted in this space, far before the timeline became the issue.

What is terribly troubling, however, is Wall Street Journal’s count of jobs. It noted that “there are now 637,000 public employees in Michigan compared to fewer than 500,000 workers left in manufacturing. Government is the largest employer in the state …”

Even as this horrifying statistic exemplifies another nail in Michigan’s coffin, the governor insists on new business taxes. She still doesn’t understand that she has taxed business out of this state, and upon whom would or could she cast another blow? The service sector, including doctors, has to date been the fastest (perhaps only) growing employment sector in Michigan. But not for long, because the service sector cannot survive without a manufacturing base to service.

Granholm signed the biggest tax increase in Michigan history on the back of businesses in the state, including the acknowledged “mistake” of the 22 percent surcharge levied as part of the Michigan Business Tax. Legislators have ignorantly refused to even discuss repeal of the MBT or the surcharge (until the deadline became the issue).

Even while surviving businesses are forced to further cut pay and benefits to those who still have jobs, the gall of public employees is to preserve them on the backs of a jobless population. That can only be accomplished through public sector consolidations, a move that should have been wholly considered before wiping out the private sector upon which they depend.

Once again we offer here the quote from Polish leader Lech Walesa, who upon speaking to a World Affairs Council audience in Grand Rapids, answered the question of a local union leader: “Even a leech knows when to leave the body.”

There is nothing left for the legislature to do except consider fundamental change, and even now it may be too late.

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