Sunday, October 7, 2007

It ain't over...Michigan's fiscal future

Non-partisan experts, the Governor, and legislators willing to be honest all agree that Monday's budget deal does not fix our state's structural deficit. Did anyone think a last minute deal hammered out by sleep-deprived, adversarial, policy newbies would eliminate a problem as vast as this structural deficit?

In order to be willing to make the necessary changes, a legislator would have to fully understand a range of factors changing our economy -- an aging population, a shrinking workforce, rising health care costs, an over-sized corrections system. But fundamentally you'd have to comprehend how the deficit relates to the seismic shift in Michigan's economy away from heavy manufacturing.

Still disproportionately dependent on a "resizing" auto industry, our tax structure has not changed to reflect the auto industry's shrinkage. Heavy manufacturing used to be our bread and butter, but not any more. A growing portion of Michigan's economic activity consists of services. You may not believe it and you may not like it, but that's how it is. To ignore that fact imperils Michigan's future.

So, when Gov. Granholm asked for a 2 percent across the board service tax earlier this year, it was actually a sound public policy idea. And it was based on non-partisan research and bi-partisan recommendations from veterans of government, who wanted nothing more than to help our state survive.

But if you were a legislator new to the process of governing, and you won your election by casting yourself as "anti-tax," you simply had to oppose this idea. In fact, if you hadn't done your homework to understand the wisdom of the idea, you might have even perceived it as a "Democrat" idea -- a hair-brained, tax and spend, liberal Democrat idea. Then you had no choice, but to oppose it.

In fact, you did have a choice -- to do your homework.

A week ago, an incomplete, inferior budget "compromise" was reached by exhausted legislators ready to scream "uncle."

Granholm continues to graciously thank legislators for working together, but she is being too generous. They didn't work together in a constructive way. They managed to cobble together a half measure and leave more tough questions for the rest of the month -- and -- for the months to come.

Citizens along the entire political spectrum -- from progressives to the Michigan Chamber -- are calling for changes to Michigan's term limit law. It "institutionalizes inexperience" says the Chamber. Watching the legislature for the last eight months, you could easily concur, even if you are a liberal.

Although Republicans postured and functioned as obstructionist, you could argue that was a basic play, like running the ball up the middle. It seemed effective and at the heart of the dysfunction, but Democrats lacked a sufficient counter move. And moderates in neither party were able to come together to talk sense to more extreme members of each party to move them to the center, where things actually happen.

Bill Rustem summed it up by saying lots of legislators were unwilling to move out of their comfort zone. True. That would have taken work and been uncomfortable.

Tom Clay said party leaders were having to "herd cats." Almost true, but with term limits it was more a matter of herding kittens. Even harder.

Can the legislature now do what they were unable to do over the last eight months? For the sake of Michigan, one surely hopes they can.