Really? Someone get DeVos on the phone. He needs to hear this.
Michigan's recent economic funk is almost entirely a function of the poor health of General Motors Corp., Ford Motor Co. and large automotive suppliers closely linked to them.
Michigan's key tax rates are slightly below the national average.
And while the state Legislature's recent abolition of the Single Business Tax could provide a small economic boost, it would be a very small one, closing only one-ninth of the employment growth gap between Michigan and the U.S. economy as a whole.
These are the key conclusions of a study being released today. It was conducted by the W.E. Upjohn Institute for Employment Research and funded by the Michigan Economic Development Corp., the state's agency for business attraction and retention.
James Epolito, president of the development corporation, said he wanted an unbiased study of how competitive Michigan is against other states and he considered the Upjohn Institute a "middle-of-the-road" research outfit without a right- or left-leaning ideology. Bartik said the institute is nonpartisan, does not do proprietary research for clients and insists on publishing the results of all its work, even if the group funding the study disagrees with the outcome.
In this case, Gov. Jennifer Granholm probably will take satisfaction from the Upjohn study's conclusion that the Legislature's move to kill the Single Business Tax at the end of 2007 -- with no replacement tax identified yet for $1.9-billion in annual lost revenue -- won't help Michigan's economy much. "Businesses like good roads and education too," Bartik said, so the appeal the tax cut will hold for businesses would diminish if important services are gutted.
-snip-
But from 2000-05, Michigan employment fell nearly 1.3% a year on average, while the United States as a whole was enjoying modest job growth of 0.35% annually. The emergence of that gap between the Michigan and national economies coincided with the declining market shares of GM and Ford in a fiercely competitive U.S. market in which Toyota, Honda and Nissan expanded their truck and SUV offerings and Korea's Hyundai emerged as a major player.
The Upjohn study concluded that it's "unlikely that Michigan's recent slow growth is primarily due to allegedly excessive business taxes or inadequate job skills. The slow growth of autos in Michigan is probably due to national and international trends, not to the state of Michigan's policy choices.
I doubt a little thing like facts will get in the way of Dick and the Destroyers. I'm sure they will dismiss this study outright and continue telling us that eliminating the SBT will solve everything- after all, being devoid of any real ideas or plans, they have nothing else to say.