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Today, the voters in Michigan are going to the polls. A few of them, that is – for no one is on the ballot, and in no one’s front yard will you find a sign. There was no one ahead of me this morning when I stopped by the Hillsdale County Library to cast my ballot, and the parking lot was close to empty. This is, you see, a stealth election – deliberately scheduled at a time when next to no one is paying any attention – and its aim is to raise the sales tax rate throughout the state.
If this were the work of the Democrats, I would not much mind. I do not expect better of them. They are the party of high taxation, of well-funded public-sector unions, and of poor service. Raising taxes and redistributing the fruits of our labors to free-loaders is their raison d’être.
What burns me is that this dirty trick is the work of our Republican Governor Rick Snyder and of the go-along-to-get-along Republicans we elected as state representatives and state senators in 2010 and 2014.
Michigan is not a high-tax state on the model of Taxachusetts, California, or Hawaii. But our state and local taxes are high nonetheless. When you put the sales tax together with the property tax and the state and local income taxes, we pay plenty – and what we get in return for our hard-earned money is a disgrace.
Let me explain.
When I was a child back in the 1950s and 1960s, my parents took a trip with me in tow every summer, and we nearly always drove. We went to Tulsa, where my mother’s family lived. We went to Madison, Indiana to visit my father’s brother or attend a landman’s convention. We drove to Westchester county in New York to see my brother, and we went elsewhere to see my parent’s friends. One year, when I was about 10, we took three or four glorious weeks and drove to California via South Dakota, Wyoming, and Montana and then came back via Nevada, Arizona, and New Mexico. Another year, we drove to Calgary in Alberta and on to Banff for a convention. By the time that I was 18, I had been in every state in the union – apart from Alaska, Hawaii, North Dakota, Vermont, New Hampshire, and Maine.
These days, my wife and I travel with our four children in much the same fashion. We take a week in March to drive south in search of sunshine (which is in short supply in Michigan during the winter). We drive to Maine to see my wife’s parents at some point in the summer. And, yes, we have driven to California by the northern route and back through the southwest.
In the course of these wanderings, I came to judge state governments by the quality of their roads. When, for example, my parents drove from Denver to Tulsa in the late 1950s and early 1960s, crossing the border between Colorado and Oklahoma was an eye-opener. And the same could be said when my wife and I drove in the early years of this millennium with our eldest from Tulsa to Santa Fe via Amarillo and crossed from Oklahoma to Texas.
I mention this because, eight years ago, when we moved from Tulsa to Hillsdale, I took it for granted that Michigan was better-governed than Oklahoma. The latter had long been a one-party state run by Democrats with a populist bent. Politics in Oklahoma was about patronage; the state was not especially prosperous; and the state government seemed incapable of doing anything well. What I did not know was that Michigan was worse – far worse.
The state had once been prosperous. In 1950, Detroit was per capita the wealthiest city in the United States. In the interim, however, Michigan stagnated. For a long time, it lived off the automobile industry – as did the United Auto Workers – and in time the left-liberal state and the unions it fostered killed the goose that laid the golden eggs.
The decline was gradual – visible, at first, mainly in Detroit, which became a nightmare. Then, it became precipitous and impossible to ignore. It quickly became obvious to me, however, when I arrived here in the summer of 2007 that something was terribly, terribly wrong. The first time I flew out of the Detroit airport I discovered that the roads were in disrepair on a scale I had never seen – outside West Virginia in the 1950s – in the course of my travels by road.
Rick Snyder became Governor after the crash. He and the Republicans were swept into office in November 2010 by the fury to which Obamacare gave rise, and he and they brought to the challenge all of the virtues and vices of the businessman. Those virtues are considerable. Businessmen can add and subtract. They are used to deal-making, and they are skilled in keeping enterprises going. The vices of the businessman are, however, considerable as well. When it comes to scruples, they tend to come up short. Pragmatism nearly always trumps principle.
If you find what I say annoying or even insulting, pause for a moment and ask yourself this. In 2009, when Barack Obama was pushing what his party named the Affordable Care Act, which side did the executives of the healthcare industry take? Did they warn us of the dangers involved? Did they take their stand with the patients they served? Or did they consult the bottom line – their bottom line – and sell us out? Put more bluntly, were they bought by Obama and the Democrats?
Do not tell me that they did not know what they were doing. This is a sphere in which they have far greater expertise than anyone else. They knew which way the wind was blowing, and they chose profit over principle. Individuals may sacrifice profit for principle. Soldiers often sacrifice their lives in such a manner. But businessmen in their guise as businessmen very rarely prefer the common good to the good of their enterprise; and, when businessmen go into politics, they tend to exhibit the habits they learned in private enterprise.
Think about it this way. When was the last time that you heard a Republican speak about justice? The Democrats do so all the time. They speak with great frequency about “social justice,” and Republicans rarely challenge them on the basic principles. Consider what is called “affirmative action.” The phrase is a euphemism for politically enforced racial and sexual discrimination. It is a sign in the window that says, “White men need not apply.” You know that, and I know that. When was the last time that you heard a Republican candidate say as much? When was the last time you heard a Republican denounce “affirmative action” as unjust. When it comes to principled argument, the Republicans – who are owned lock, stock, and barrel by the Chamber of Commerce – generally fall silent. In the face of evil, they temporize.
You see, they are afraid of conflict. It is bad for business. The thing to do is to make a compromise. The Democrats are not similarly timid. They thrive on conflict. They seek it. They stir things up. They know where they want to go, and they seize on every opportunity to press their agenda. And when they push, they are apt to push very, very hard.
And how do the Republicans respond? For the most part, they cower and head for the exits. Then, they seek a compromise. The Democrats are the party of motion; they Republicans, at best, drag their feet.
That is the story in Michigan. Rick Snyder and the Republicans took office early in 2011. The state was in dire straits. It had one of the highest unemployment rates in the nation (for a time, it was number one), and the automobile industry was not going to make a dramatic comeback – not in Michigan, at least. So Snyder, who is a capable businessman, moved to cut the exceptionally high corporation taxes here. They had been imposed on the presumption that the automobile industry had nowhere else to go; and, as Snyder understood, they had helped strangle it and to keep other businesses from relocating here.
The Republicans could have taken this as an opportunity to trim state government. But this Snyder did not want to do – for that would have required a fight. So, instead, to make up for the shortfall, he and his minions extended the state income tax to the pensions of those bringing in more than $60,000 a year. This was a truly stupid move. The winters in Michigan are cold and long. Everyone here who can afford it has an incentive to retire elsewhere, and the tax on pensions gave those Michiganders who had scrimped and saved for their old age an added incentive to head south – which means that this tax, as a source of income for the state, will gradually dry up. And it means that sales tax receipts will be less than they would otherwise be. This is the sort of measure that will work in the short term and do harm in the long term. But, of course, Rick Snyder and the Republicans in the legislature who backed him are not apt to be in office when the bill comes due.
Now these same Republicans want to raise the sales tax rate. They have an argument. The roads in Michigan are a disaster – and this arguably has something to do with state expenditures. As my colleague John J. Miller pointed out yesterday in The Wall Street Journal, Indiana spends $339 per capita on roads; Ohio spends $258; Wisconsin spends $295; and Michigan spends $126. But that is not because Michigan does not spend. Our taxes – when you add the state (and local) income taxes, the property taxes, and the sales taxes – are considerably higher than those in Indiana.
Our difficulties do not arise from a lack of funding. Nor do they stem from the fact that Rick Snyder and the Republicans are skinflints. Since 2011, when Rick Snyder and the Republicans took over, the state budget has increased by 14% from $26.3 billion to $30 billion.
Our problems arise not from a lack of funds, but from a misallocation of funds. Last year, Michael LaFaive of the Mackinac Center for Public Policy produced a report suggesting $2.1 billion in budget cuts that would free up more money for roads than the sales tax increase is apt to raise. As John points out in his article,
He recommend repealing a prevailing-wage law that pushes construction costs up by about $250 million a year; ending a $40 million Amtrak subsidy; and wiping out a program for moviemakers that recently lavished $35 million on the forthcoming film “Batman v. Superman.”
To make matters worse, only $1.2 billion of the $2 billion that the sales tax increase is supposed to raise is slated for improving transportation, and some of that $1.2 billion is supposed to be used for light rail, bike paths, and downtown improvements. The other $800 million is a bribe aimed at attracting the support of the Left.
Those who are familiar with Michigan politics doubt that this tax increase will pass. If they are wrong and it does pass, I am confident that, in the next statewide elections, the Republicans will be voted out. I do not mean to say that the Republicans of Michigan are not preferable. They are certainly less bad than the Democrats. But they are not good. They are not good at all. The Democrats fight and the businessmen-turned-politicians who run the Republican Party give ground. We are on the road to perdition. The only question is whether we will be conducted to our destination gradually or quickly. It is hard to be enthusiastic about a political party that is always intent on selling us out.
But what is this to those of you from outside Michigan? It is, I would suggest, a straw in the wind. The national party is not much better than the Michigan party. When Harry Reid controlled the U. S. Senate, he pressed home the Democrats’ advantage. Now that Mitch McConnell is in charge, he seeks compromise.
Is there a candidate out there running for the Republican presidential nomination who is a person of principle, who would turn the Republican Party from a party of compromise into a party of motion, who would lead us away from the destination towards which the country is now tending? Is there someone who understands the manner in which our national security has been compromised and who has the courage to speak the truth? And is there someone who is also not afraid to raise the question of justice?
I would like to think so. But I harbor grave doubts.