Guess who’s not running for election in 2018? Me. That’s not news, really, but it does provide some insight into the stance that we’ve taken against the Legislature’s push for tax cuts through an increase in the state personal exemption. Though the cuts were supported by leaders on both sides of the aisle, we at the League looked beyond the aisle at the people in our state. The real people.
When the state Legislature came up with its tax plans, which were at odds with Governor Rick Snyder’s more responsible plan, I sat with our staff to take a look. They’re experts in this. When they examined the data they saw a nominal tax cut that would barely create enough annual savings for families to get an oil change or an afternoon of child care.
But “We cut your taxes” sounds pretty good in a campaign ad.
What does “We cut your taxes” look like in a practical sense, though? Well, I’ve already addressed the paltry savings it would bring to Michigan families. But what about how it would impact our state as a whole?
For starters, the tax plans could create up to a $200 million hole in the state budget. Where will that money come from? If history is any indication, we suppose it will come from programs that support things like roads, bridges, police, our kids’ education and our families’ basic needs.
And this isn’t an ordinary tax cut. It comes at a most tumultuous and uncertain time, as the federal tax plan leaves so many unanswered questions. Federal funding makes up 40% of our state budget, and cuts in Washington mean cuts to services and programs that help millions of Michiganders thrive. To make reckless cuts like this during such turbulent times is myopic at best.
When companies like Amazon take a look at our state’s landscape and decide to pass, Michigan should probably start listening to them. When the governor calls for fiscal responsibility to maintain the state’s positive trajectory, Michigan should listen. When the state treasurer, arguably the sharpest financial mind in the state, urges caution, Michigan should listen. When the conservative-leaning Detroit News editorial board writes that investments are better than tax cuts right now, Michigan should listen. When economic experts continue pushing for careful budgeting, Michigan should listen. When the people of our state place tax cuts low on their list of priorities, Michigan should listen.
More importantly, when young, talented people are leaving our state, we all must start listening to them. They aren’t in search of tax cuts. They’re in search of the things we should be investing in: strong infrastructure, mass transit, safe housing, great educational systems and a quality standard of living.
If the best plan legislators can come up with for Michiganders is a tax cut, then the Legislature needs to start listening.
Now is a time for fiscal responsibility. We know that doesn’t sound like something that will make Michigan a more vibrant and attractive state, but it is. Carefully budgeting our money allows the state to invest in the things we need to gain and retain a talented workforce.
Lawmakers must use restraint when looking at the budget. It may seem counter-intuitive for an organization like ours to oppose credits for child care or for senior populations, but we can’t examine issues in silos. Tax cuts and the budget go hand-in-hand, and we cannot risk losing funding for programs that help those who are most in need. These credits and tax cuts look might look good on campaign materials, but we know our state doesn’t have the revenue to implement them properly.
I’m not running for election and neither is the League. Instead, we’re hoping to be the voice of reason in this already-hectic election year. Right now, the people of Michigan deserve investment in the things that matter, not symbolic tax cuts designed for a political campaign.
— Gilda Z. Jacobs