Essay: Budget Deal? - 10/1/07

Barely twelve hours before Michigan government was scheduled to shut down, here’s what a special House-Senate conference committee was trying to decide:

Should they extend the state sales tax to . . . bronzing baby shoes? How about palm reading? Astrology? Singing telegrams?

Fees for playing golf? In the end, they did indeed extend the sales tax to all those things . . . except golf.

I’ll leave it to you to decide whether that has anything to do with the fact that legislators and their lobbyist friends play a lot of golf.

Today, there are people in Lansing congratulating themselves because the government shutdown only lasted four and a half hours.

I think that is crazy. I don’t think the fact that it could be worse is reason for anyone to feel especially proud or happy about anything having to do with state government.

First of all what you saw happen this weekend amounted to proof that what we had was a near-total failure of the system.

This day has been coming since Gov. John Engler’s troops enacted tax cuts without reducing spending or raising other revenue to replace the lost money. Ever since Memorial Day, we knew that today was the precise day financial disaster would hit Michigan.

Yet for month after month, nothing happened, nothing got done. Last night a legislator told me that I should not be too critical of this, that everyone knew nothing would happen till the last minute.

Well, I disagree. We’ll never know how many businesses decided recently not to move to Michigan. Actually, you could argue that during the last few months, anybody would have been nuts to think about starting a business here.

Let’s see. Until four-thirty this morning, nobody knew what the income tax rate would be next year. We didn’t know whether the sales tax would be applied to services and if so, what services.

Nor did we know at what rate they’d set any sales tax on services. This is not a way to run anything.

Matter of fact, we didn’t even know at this time yesterday if we were going to have a functioning state government today. And for four hours, we didn’t. That doesn’t mean there weren’t some heroes and some courageous people. Four Republican state senators risked their political futures to support the tax increase.

Some of them are now being threatened with recall elections, for doing what they thought was right. But if anyone is hot to remove somebody, I want to throw a new name out there for consideration.

State Rep. David Agema, a Republican from Grandville, didn’t vote for the tax increase. Nor did he vote against it. That’s because during Michigan’s biggest fiscal crisis ever, he chose to go to Russia.

He is on vacation hunting sheep, and didn’t think the present crisis was important enough for him to cancel his vacation.

I don’t know what you think about that, but here’s my reaction. You just can’t make this stuff up.

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Comments

[Travis Stoliker]

Jack,
Great post. I just started reading your blog and so far I'm very impressed. Thank you for the quality content.

I think today's decision to raise the income tax is a very bad direction. I personally feel that we should be moving to taxes on consumption not on income. (Similar to Florida, Texas, yada yada)

[Michael Fultz]

The thing that impressed me the most about this whole fiasco is the total lack of maturity our "leaders" have demonstrated. This irked me enough that I had to write something on my blog about it.