Tuesday, October 2, 2007

The New Floor for Big Government

On Sunday night, the legislature gave Governor Granholm most of the new revenues she asked for, about $1.5 billion. Argue if you like whether she needed the money to balance the budget, or to "protect the vulnerable" or to keep government running. Believe what you like about the reasons for the big increase in revenue, the fact is we have raised the floor for the minimum budgetary expenditure for next year.

Government grows; no matter how hard we try to shrink it, the best we can hope for is to minimize its growth. Under Craig DeRoche's leadership as Speaker of the House in 2005 and 2006, government did something it has not done in years: it grew at LESS than the rate of inflation. But this year, we went back to government business as usual. The budget is not final, but when it is at the end of October, you will find that once again state government is growing at above the rate of inflation, even though the economy is contracting and state population is shrinking.

Bad as all that is, early projections are that the budget for 2008-09, will be $500 million in the RED. Anyone care to wager that number will be larger when the annual revenue estimating conference takes place next January?

We conservatives have said it ad nauseum, Michigan does not have a revenue problem, it has a spending problem. The halls of the Capitol have been clogged with good people called lobbyists. They work hard and earn their money well. They are paid to make the case for any number of agencies and organizations, all of whom are tax-eaters. When they see a fresh supply of revenue, they descend on the black and white tiles of the Capitol like a plague of locusts. They are every bit as effective; when they are done, there is nothing left.

We just increased taxes by $1.5 billion; we do not yet have a budget for the new year. This means opportunity. Every beneficiary of the government largesse will be there, making the case for why they need just a little more money.

1 comment:

Michigan Mom2three said...

As a Michigan family, we feel so helpless. It's been a horrendous two years for our family, economically, as we are not living on less than 1/4 of my husband's previous income (from the job that moved us to Michigan in the first place!) We have cut all the fat from our own budget, doing without tv, extras, eating out, new clothing, etc. We have tightened our belts and cut our spending drastically so that we can live within our means without going into debt. How does the state of Michigan "help" us in this endeavor? By raising our taxes and taxing things that used to not be taxed. We take home less and spend MORE. It boggles my mind how ANYONE can think this is going to "help" the economy. I may not know much about economics - but this doesn't make sense. I can only see that living in Michigan just became more burdensome, and we are powerless to change it. We just have to endure more hardship. The Governor said we'd be blown away in 5 years - and I believe it..... I see many families and citizens "blowing away" to other states to make a living in, that don't cripple their taxpayers!