As I stated in my weekly podcast, I’m not crazy about Governor Whitmer’s 45-cent tax increase either. Like my guest, Democratic state Rep. Laurie Pohutsky correctly described it, the proposed tax is regressive. The tax really won’t hurt rich Michiganders, but it will affect the rest of us in a negative way.
Which is why it was brilliant for the governor to include a rise in the Earned Income Tax Credit, and why it’s equally brilliant for Democrats to propose a bill to raise the EITC even higher than Whitmer’s proposal.
They’re trying to find ways to help offset the cost, and that’s smart.
What’s not smart is to ignore the situation, or to keep dealing with our bad roads right now.
Former Republican and his Republican legislature raised the gas tax a few years ago, but it only served to put a band aid on the wound. More must be done.
So, Governor Whitmer’s trying to do that in order to save Michigan.
But as I also asked on the podcast, what’s the alternative?
There is a reason governors — and not just Democrats — keep returning to gas taxes as the way to finance public infrastructure. Those who use the roads should pay for them, rather than relying on the general taxpayer to subsidize their driving. This is the principle on which the nation’s roads and rails were funded for decades until an increasing aversion to hiking gas taxes led to budget gaps — and potholes.
Michigan conservatives are up in arms over the proposal, of course, because they want Whitmer to fail. So, they’re going to block her from enacting this proposal.
Which means they will only allow her to pass a modest tax increase that won’t begin to fix the problem.
Naturally, Republicans are also opposing Whitmer’s proposal to slightly raise business taxes. But some business groups are actually opposing the Republicans, such as Business Leaders for Michigan.
That group supports the tax proposal because it’s a “user fee” tax, which means those who most use the roads will pay more. Which is why I’ve pressed that business taxes must rise a bit, too. The burden shouldn’t be felt just by hardworking Michiganders. Businesses also benefit from a solid infrastructure. They ought to have some skin in the game.
As the Tax Foundation highlights, Michigan has the lowest corporate tax rate per capita compared with the rest of the Great Lakes states. Ohio is the exception since it doesn’t have a corporate tax rate, which didn’t help keep GM from shuttering its doors in Lordstown, did it?
(Hat tip to Crain’s Detroit Business’ Chad Livengood)
It’s almost like the radical right wing agenda in Michigan worked exactly as planned: Slash taxes on corporations which would lead to a privatization boon. Slash public school funding, schools falter, shutter them, and drive students to for-profit charter schools which undergo little-to-no oversight. Gut environmental regulations, leading to contaminated water throughout the state. And finally, roads deteriorate to the point where the only solution is to cut other programs to provide a little funding to nominally improve the roads.
For years, progressives asked the question, “What’s The Matter With Kansas?”
For me, I wondered, “What’s The Matter With Michigan?”
It appears Michiganders eventually caught-up to the game. That’s why they voted for change in 2018. We watched how the DeVos-backed GOP’s laissez-faire experiment failed all of us.
So, progressive candidates won state-wide races, and younger progressives won seats in the state legislature despite the GOP’s iron-clad gerrymandering.
And major progressive causes earned huge victories in ballot initiatives, such as minimum wage hikes, early voting rights, and yes, ending the GOP gerrymandering game.
You’d think the Michigan GOP would take notice, but they’re hoping you’ll blame Governor Whitmer’s plan to save Michigan rather than how they ruined Michigan.
Let’s hope we keep our eye on the ball.