(Also available in green at Blogging For Michigan.)
This is the kind of story that never seems to make its way to the major media outlets here in Michigan, the kind of story that cuts the heart right out of one of the MI GOP's main talking points. First of all, listen to DeRoche wail about the budget surplus-
"The governor and House Democrats have repeatedly papered over the true budget situation. They failed to report $70 million in overspending, inflated budget proposals to increase the deficit, and then shut down the government to force a tax increase."
Knocked down easy enough, even by the Detroit News-
But the theory that a potential surplus was hidden from lawmakers to support tax hikes is weakened when it is noted that the state used nearly $360 million from other, specialized funds to balance the General Fund in the last budget.
And that the governor issued an executive order cutting appropriations during the year by $274 million.
Despite new taxes adopted by lawmakers, the current fiscal year would have been out of balance without the surplus.
Once again, DeRoche is proven to be erroneous in his assessment of the situation, which is probably an everyday occurrence in the Wacked World of Craig, right? No big deal, really- but notice how that one key word gets out there once again.
Overspending. And if you listen closely, you will hear just about every Michigan Republican that gets that attention of the media trying to convince the public that the state government is overspending, when in fact, we aren't even keeping up with inflation.
One lonely story in the Lansing State Journal tells us the truth, and then you have to dig from there.
The idea that state taxes and spending are out of control is a myth and an impediment to getting Michigan's economy back on track, a group representing universities, cities and nonprofit agencies said Thursday.
Rather, personal income has outpaced state spending, and investments in programs critical to the state's welfare have been slashed, the group said. Cuts to colleges have meant students pay more for tuition and cuts to cities have resulted in fewer police patrolling the streets.
Total spending from state resources has risen 10 percent since fiscal 2001, while personal income is up 19 percent, according to the report by the Michigan Fiscal Responsibility Project.
The Michigan Fiscal Responsibility Project runs the site Michigan Tax Truth, and they were kind enough to print articles from both MIRS and Gongwer that have some interesting facts that help put everything into perspective.
The more you know. Looking at the tax rate, the state takes less out of you today than it did under Engler. From MIRS-
Michigan's personal income has increased nearly twice as fast as spending from state taxes and fees since 2000, a new analysis of Michigan's budget shows, even after including the 2007 tax increases. And the state's bite out of the average family's paycheck today is about 15 percent less than in 2000.
State spending from state taxes and fees has increased by only 10 percent since 2000. Meanwhile, state personal income has increased during that period by 19.3 percent and inflation has increased by 17.4 percent.
Even after passage of the 2007 tax increases, data from the Senate Fiscal Agency (SFA) shows state taxes are taking about 16 percent less of Michigan paychecks than in 2000. Today state government takes about 8 cents from every dollar earned in Michigan; in 2000, it took, 9.49 cents.
Which leads to the consequences of the tax cuts. It's not that we are "overspending"- we have slashed the revenue to the point where it only appears that we are overspending.
"Michigan's budget reality is far different than some special interest groups and many lawmakers are portraying," said MML Executive Director Dan GILMARTIN. "Michigan isn't living beyond its means. What is happening is that decision makers from both parties are cutting the means regularly, planting the seeds for the budget chaos that is destroying our state's ability to invest for the future."
Adjusted for inflation, revenue sharing has gone down 31 percent in Michigan since 2000, which is MML's major issue. State funding for Michigan universities has been cut 10.5 percent in that same period, resulting in universities raising tuition.
The MFRP analysis shows how those cuts have not been required by the state's economic doldrums, but are the result primarily of tax cuts imposed in the late 1990s and during this decade, including major reductions in state income tax rates, increases in state income tax deductions, elimination of estate taxes on the very wealthy, and business tax reductions.
Republicans don't believe in "adjusting for inflation" when they try to convince everyone that spending is out of control, of course. Better to take those big round numbers and deceive the public, because that is the only way that they can make those talking points fly.
Watch Matt Marsden shake his head, close his eyes, and stick his fingers in his ears and go, "la la la la, I can't hear you!" as tries to make reality go away once again.
Matt Marsden, spokesperson for Senate Majority Leader Mike Bishop (R-Rochester) said the group's premise is wrong. "We've seen a steady increase in state spending over the past number of years," he said. "To suggest that we don't have a budget challenge and we don't have to live within our means is complete nonsense."
He admitted that revenue sharing and universities have seen cuts, but he said it was because other areas of the budget had exceeded their share of the growth. "It ignores those areas that have had massive increases like state employee pay and benefits and corrections," he said. "These other areas have been squeezing out (areas of the budget that have been cut)."
Yes, of course, it's the state employees again. All their fault. Matt won't rest until their pay and benefits are cut, and chances are that what he really wants is to destroy that darn union and make those employees join the race to the bottom.
Say, how is that legislative pay/benefit cut idea coming along, Matt? Haven't heard anything about that since the House passed it in December. Seems like you might want to lead by example.
Actually, all of that is chump change and a diversion from the issues of tax exemptions and the real spending growth areas such as corrections and Medicaid.
The group is urging that any future tax cuts be accompanied by the program cuts that would pay for them. They argued that the budget deficit was caused not by economic losses, but by overly aggressive tax cuts.
The state also should review all of the tax credits and exemptions it offers to determine which are still truly warranted. The report noted that such tax expenditures increased $1.2 billion last fiscal year.
But the group also argued the Legislature and the administration did not address sufficient substantive reforms to state spending. Mr. Boulus and Mr. Weinfeld argued there were still efficiencies to be gained in Medicaid and Corrections, pointing specifically to the sentencing changes Governor Jennifer Granholm had proposed.
Will the Republicans act on the reforms that will truly save us money, such as sentencing guidelines and health care? Or will they spend this year insisting that the state "overspends" and we need cut revenue even further?
Bet you know the answer to that one, and I bet the media won't go out of its way to tell you the truth on the claims the Republicans make during their campaigns.
(Yes, I am working on doing more cross-posting to this blog, but blogging itself has been pretty difficult with a broken arm. Give me time...)