Oh Michigan!

From the First Tuesday newsletter
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‘O’ stands for October — and it also stands for Opportunity.

With just a few short weeks before the Nov. 4 election, now is your best chance as a concerned Michigan citizen to make a difference.

You can do this by:

1. Informing candidates for public office about policies you support.
2. Asking candidates about those issues so you can vote for the person who best reflects your priorities.

There’s a lot at stake in this election. In state elections, all 110 members of the House of Representatives and 38 Senate members will be elected in addition to the governor.

To help sort through this monumental task, the League has identified 15 public policy areas.

One of the biggest is what to do about our crumbling roads. Solutions offered are increasing the sales tax, creating a wholesale tax on gas, raising vehicle registration fees or diverting sales tax revenue. Creating or increasing taxes, especially the sales tax, will disproportionately affect those earning low wages.

Here’s the question to ask your candidates:

“Do you support increased or new revenue to address Michigan’s crumbling roads and infrastructure? Would you support increasing the Earned Income Tax Credit or other tax credit to help offset the burden on people earning low wages?”

Beware of the candidate who has a simple solution. If the answer is to just make roads a priority for funding, what happens to the other services such as health and education that now must make do with a smaller funding pot? Those who would simply increase the sales tax risk ignoring the realities of our economy — that families with low incomes pay a much bigger share of their income in sales tax than wealthier families.

Another question for candidates focuses on child poverty, which has escalated by 40% over the last 25 years with nearly one in every four Michigan kids now living in poverty. That’s $19,000 a year or less for a family of three and $24,000 for a family of four. The question for candidates:

“Several policy initiatives to alleviate child poverty have been suggested, such as raising the minimum wage to $10.10 — closer to its value in the 1960s and indexing it to inflation, reinstating the state Earned income Tax Credit to 20% of the federal EITC, and raising the child care subsidy and easing eligibility requirements, parents earning low wages can access child care. Would you support any of these initiatives?”

A newer policy area of work for the League looks at clean energy and health-related costs of coal-fired electricity generating units that more deeply affect people of color and those who are economically vulnerable. To explore this, ask your candidate:

“Would you support transitioning from coal to clean energy sources, such as wind and solar power to reduce pollution and improve the health of Michiganians?”

For more help and background, see the League’s full set of questions, candidate fact sheets by district and advocacy basics.

When policies, debates and energy are focused on reducing child poverty, improving tax policy and making our air clean, we will be able to celebrate another ‘O.’

That would be for Outstanding!

– By Gilda Z. Jacobs

Holy smoke Batman! We can reduce poverty

Like Batman and Robin, raising the state Earned Income Tax Credit and minimum wage are best when working together, a new report concludes.

The two strategies are better than one, according to State Income Taxes and Minimum Wages Work Best Together, by the Center on Budget and Policy Priorities. (more…)

Flood waters: a taxing problem

From the League’s First Tuesday newsletter
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My family and I were unfortunate enough to experience the recent flooding in Southeast Michigan. Despite the fact that we lost appliances, some precious photos and an assortment of stuff we had accumulated over the past 37 years, we will be OK. We had insurance and were able to get a company to clean and sanitize our basement very quickly. And we will not need to go into our retirement funds to make our losses whole. (more…)

A stronger Michigan economy is within reach

Yes we can grow Michigan’s economy, create good jobs and expand opportunities for all Michiganians with the right public policy decisions. A new report by Erica Williams at the Center on Budget and Policy Priorities outlines how policymakers can make that happen.

Williams explains that states need to invest adequately in education, healthcare, transportation and workforce development. And in order to do that, they need to make decisions about how to raise and spend revenues with an eye toward the future. (more…)

Camp’s costly change of heart

U.S. House Ways and Means Committee Chairman Dave Camp, R-Mich., is having a very expensive change of heart in seeking to make a corporate tax cut called ‘bonus depreciation’ permanent.

Camp’s previous plan for tax reform recommended ending bonus depreciation. A recently released report by the Center on Budget and Policy Priorities details Chairman Camp’s policy reversal.

Bonus depreciation lets businesses take tax deductions for certain new purchases such as machinery and equipment upfront. The goal is to spur investment and economic growth during recessionary cycles. (more…)

State budget must offer economic opportunity

Join us in urging state lawmakers to support the investments in children and families that are needed to reduce poverty, help low-wage workers, restore funding for public schools and universities, and ensure that communities have the revenues needed to provide the basic services that residents and employers need to thrive and help the economy grow.

Joint House/Senate conference committees are beginning to meet today to resolve differences between the House and Senate versions of the Fiscal Year 2015 budget. After conferees sign a negotiated conference report, the budgets are sent to the full House and Senate, where they can be approved or rejected, but not amended. (more…)

State budget balancing act

As Michigan lawmakers head off to Mackinac Island for the annual Detroit Regional Chamber of Commerce policy conference, they are scrambling to resolve several big ticket issues that have slowed down the budget process and could reduce the amount of money available for services critical to our state’s economic development.

First is how best to fund much-needed improvements in Michigan roads, bridges and public transit. The governor wants at least $1.3 billion a year for improvements while some think that isn’t enough. There is little controversy that something needs to be done, but much disagreement on how to pay for it. (more…)

Feel-good proposal is bad public policy

A new proposal to create so-called sales tax holidays here in Michigan may sound appealing, but it’s poor public policy.

Sen. Mark Jansen’s proposal (Senate Bill 943) exempts certain items from the sales tax for several days prior to camping season, the beginning of school and hunting season. The idea is that eliminating the sales tax during certain times of the year will help low-income taxpayers, spur spending and cost the state little in revenue, but the facts show otherwise.

And because of that, it’s not surprising that in recent years a number of states have ended their sales tax holidays. (more…)

Mich.’s working families pay $247 million more

The numbers are in and they show that the reduction in the Michigan Earned Income Tax Credit from 20% of the federal credit to 6% has resulted in a $247 million tax increase on low-income working families.

Recently released data on the Michigan EITC for tax year 2012 from the Brookings Institution and the Michigan Department of Treasury reveal the actual EITC dollars lost for hardworking Michigan families. (more…)

Tax cuts do not lead to prosperity

Two new studies out this week should help drive a stake through the heart of the argument that cutting taxes will lead to prosperity.

For far too long tax cuts have been the tool of choice for Michigan policymakers. And guess what? Tax cuts don’t work as promised. (more…)

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