Articles of Interest 3-25-06
Last night, my last event of the day was at Michigan State University where over 50 students had gathered to make phone calls using our “roaming phone bank” of 60 cell phones. By 7:45pm last night, they were well on their way to completing some 4,500 surveys which could add almost 20,000 “ID’s” to Voter Vault!!!
State CR Chair Dan Carlson and the rest of the team from 12 different campuses came together to take on this project. Today, over 60 CRs will be going door-to-door in targeted precincts, knocking on specific doors and conducting our surveys in person!
Congratulations and thanks to the College Republicans from around the state who participated this weekend. I was talking to our Youth Chairman Matt Golden and MFCR Chair Dan Carlson on the way out and they plan on having a “working weekend” like this every month at a different college or university helping our local candidates and helping the State Party enhance their Voter Vault in targeted areas around the state!
The State Party provided the pizza and these CRs brought the enthusiasm and horse power to help make it work. Taking “pizza & politics” to the next level!!! What a great asset and part of our team…our College Republicans!
Congressman Thaddeus McCotter, member of the International Relations Committee, continues to lead the effort to help keep public attention on the freedom demonstrations in Belarus over the last week. Yesterday, the Belarus police/army finally broke up the main demonstration, but students, intellectuals and others continued their quest for freedom. Take a few minutes to read some of the articles of their struggle. It really puts our political battles into perspective…and makes you wonder how often we take the freedom this country has blessed us with for granted.
President Bush put out some great talking points about what the difference is between Republicans and Democrats on taxes. Please check this out and use these facts:
http://migop.blogs.com/blog/2006/03/taxes_there_is_.html
Our newest web ad and web site featuring Senator Debbie Stabenow is a huge hit. The first hour or so it was released, our T-1 Internet service was packed and temporarily slowed as folks lined up to download the ad and see how “Dangerously Incompetent” Debbie Stabenow voted on various issues. The ad has only four words: “danger”, “dangerous” and “dangerously incompetent”….you get the point. If you haven’t had a chance to see it, goto:
http://www.dangerousdebbie.com/
I have had several questions about forwarding my email….YES, please go ahead and do so. If you know of interested parties that you think might enjoy seeing my daily email, please feel free to email them. If anyone would like to be added to the list, just have them send me an email and I’ll add them to the list. As most of you are aware, an archive is posted on the web daily on my blog at: www.migop.blogs.com -- so you can also find all the earlier posts and commentaries there.
Empowering the grassroots with information, news and up to the minute political news you can use will help our activists around the state be better Republican warriors. We have a great opportunity to help turn Michigan around, you can help keep folks engaged by sharing this information. So feel free…the more the merrier!
Saul Anuzis
http://www.lsj.com/apps/pbcs.dll/article?AID=/20060325/OPINION02/603250323/1087/opinion
Atkins, Williams: Single Business Tax is dragging down Michigan's economy
Granholm & Co. are wrong about immediate action
Michigan's economy is a mess, and most lawmakers agree the Single Business Tax is a big reason why. Yet Gov. Jennifer Granholm is filibustering every effort to repeal the notorious tax, and her threatened veto of a new bill would again stall progress on the state's business tax climate.
The Michigan House of Representatives and Senate have passed a bill that would kill the SBT and give lawmakers a year to come up with replacement taxes. But Granholm insists on immediate replacement revenues.
http://www.mlive.com/news/kzgazette/index.ssf?/base/columns-2/114321909788970.xml&coll=7
A long, tense gubernatorial race
Just how tense will this year's gubernatorial race be?
Judging by the recent hostile exchange between Michigan Democratic Party Chairman Mark Brewer and John Truscott, spokesman for the Republican gubernatorial candidate Dick DeVos -- with one threatening to have the other arrested for trespassing and the other threatening to file an assault complaint -- it's going to get pretty darned tense.
http://www.theoaklandpress.com/stories/032406/bus_2006032412.shtml
Republicans get the hot button issue they sought
Well, they've gone and done it. The state Senate has passed the elimination of the dreaded Single Business Tax, sending it back to the House for final approval, which is expected next week.
http://www.dailypress.net/stories/articles.asp?articleID=1424
Editorial: Business tax debate: politics of change
In politics, especially in Michigan the last few years where efforts continue to revive the economy, life is seldom perfect.
That was the case, and then some, Wednesday when the state Senate followed suit with the House and voted to eliminate the state’s Single Business Tax.
http://www.mlive.com/news/grpress/index.ssf?/base/news-1/1143215367237530.xml&coll=6
Kent, Ottawa roads wait on Lansing
The light load of state road dollars headed to West Michigan this year won't go far for travelers on Northland Drive in Kent County and U.S. 31 in Ottawa County.
In each case, clear needs for expansion of the highway system are being bypassed in favor of short-run fixes that fit within the Granholm administration's eastward-tilted transportation policy.
http://www.humaneventsonline.com/article.php?id=13498
Sacrificing Saad on the Altar of Political Cowardice
Even the best of men can take just so much. No nominee should expect that "his side" is going to hang him up as a political piñata and stand by while partisan hacks flail away at him. But that's what happened to Judge Henry Saad.
Democratic Sens. Carl Levin (Mich.) and Debbie Stabenow (Mich.) blocked Saad but not because he isn't qualified.
Levin is still mad because when President Bill Clinton nominated a cousin of Levin's wife to the 6th Circuit, she wasn't given a hearing by the SJC. Stabenow got ticked after somebody forwarded a private e-mail that Judge Saad had sent to a friend expressing criticism of Stabenow for blocking his nomination. And this comes from a woman who denounced the administration while standing on the Senate floor next to a sign reading "Dangerously Incompetent." Some temperament.
EPA releases $7.5 million to clean Rouge River
DEARBORN, Mich. (AP) — The U.S. Environmental Protection Agency has released $7.5 million for cleanup work on the Rouge River, a once badly polluted waterway that flows through heavily industrial sections of metropolitan Detroit, U.S. Rep. John Dingell says.
http://www.mlive.com/news/kzgazette/index.ssf?/base/news-17/114321724313720.xml&coll=7
Mild winter puts a dent in body-shop business
Lee Babcock, of Dunshee Body and Frame Inc. in Kalamazoo, said he hasn't seen such a slow winter repair season in his eight years at the KL Avenue shop.
Dale DeGroot, co-owner of DeGroot Carstars near downtown Kalamazoo, could be forced to lay off two of his 10 employees because there aren't enough repair jobs for them.
http://www.mlive.com/news/sanews/index.ssf?/base/news-18/114321020310840.xml&coll=9
Bird flu preps begin
Medical authorities say they are girding for battle if a pandemic such as bird flu infects mid-Michigan.
Health workers will set up a drive-through dispensary to administer vaccines to hundreds of "victims" during an exercise in May at TheDow Event Center along with St. Mary's of Michigan and Covenant hospitals in Saginaw.
http://www.mlive.com/news/fljournal/index.ssf?/base/news-35/1143213680171930.xml&coll=5
Young workers grapple with choices for future
GM, Delphi Buyouts
Phil Bunting is too young to retire and too busted up to leave General Motors and his coveted health care benefits.
Just 32, he's among the workers who don't have much seniority with GM or Delphi Corp. and face a special dilemma in considering the companies' buyout offers.
http://www.nytimes.com/2006/03/24/international/europe/24cnd-belarus.html
Europe and U.S. Denounce Crackdown in Belarus
MINSK, Belarus, Friday, March 24 — Belarussian riot police officers arrested hundreds of antigovernment demonstrators early this morning in the central square of Minsk, ending five days of protests and prompting swift denunciations from Europe and the United States.
http://www.nytimes.com/2006/03/24/international/asia/24cnd-convert.html
Afghan Clerics, in Friday Prayers, Call for Convert's Execution
KABUL, Afghanistan, March 24 — Afghan clerics used Friday Prayers at mosques across the capital to call for death for an Afghan man who converted to Christianity, despite widespread protest in the West.
As the international pressure on Afghanistan grew, the clerics demanded the execution of the Afghan, Abdul Rahman 41, if he does not convert back to Islam. His conversion 15 years ago was brought to the attention of Afghan authorities as part of a child custody dispute.
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/24/AR2006032400942.html
U.S. to Impose Sanctions on Belarusan Leaders
Washington Post Staff Writer
Friday, March 24, 2006; 12:48 PM
The White House today denounced the suppression of political protests against election fraud in Belarus and said the United States plans to join European nations in imposing sanctions on Belarusan leaders.
In a morning news briefing, White House spokesman Scott McClellan said the United States demands the immediate release of hundreds of protesters who have been arrested for demonstrating against the reportedly rigged March 19 elections, which President Alexander Lukashenko claims to have won with 83 percent of the vote.
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/23/AR2006032301822.html
Protest Turns Violent in Heart of Paris
Gang Rampage Mars Rally Against Job Law; Pressure Builds on Chirac
By Molly Moore
Washington Post Foreign Service
Friday, March 24, 2006; Page A01
PARIS, March 23 -- It was just the scene the French government had been dreading: burning cars seven blocks from the Eiffel Tower, shop windows smashed along one of the capital's toniest streets, and columns of helmeted riot police advancing across the greensward of a prominent tourist venue.
http://www.humaneventsonline.com/article.php?id=13483
'To The Barricades!'
by Oliver North
HEIDELBERG, GERMANY -- The streets of this quaint university town are less photogenic these days. Much to the chagrin of the city fathers -- and businesses relying on tourism -- nearly every corner is filled with very un-Teutonic piles of garbage -- the detritus of a weeks-long public workers strike. The accumulated trash may be an eyesore -- and eventually a haven for vermin and rats -- but it hasn't kept the local university students off the streets -- or dampened their enthusiasm for "bringing down the system." All this I learned quite unexpectedly while visiting here to make a documentary on the life and death of General George S. Patton. Old "Blood and Guts" had liberated this city in 1945 and died not far from here after a car crash in December that year.
http://www.humaneventsonline.com/article.php?id=13468
Use Every Diplomatic Means Necessary to Ensure Abdul Rahman's Release
The following letter was sent to Secretary of State Condoleezza Rice, calling for both the immediate release of Abdul Rahman and the necessity of freedom of conscience and worship in Afghanistan.
http://www.dailypress.net/stories/articles.asp?articleID=1435
Wage hike will hurt Michigan
If you want to experience similar conditions to that of a Third World country, stick around. You needn’t go any further than the Michigan borders.
Already one of the most economically-troubled states, Gov. Granholm is soon to sign her much desired minimum wage hike. With this 44 percent increase, prices will rise and businesses will see their competitive edge further erode.
All the more reason to put nationally- and internationally-experienced economic advisor Jerry Zandstra and economically sound and savvy businessman Dick Devos in their proper positions in government this fall.
http://www.cleveland.com/news/plaindealer/index.ssf?/base/cuyahoga/1143279552124850.xml&coll=2
Officials wonder: Is Gilbert serious?
City tries to gauge his desire to move Quicken here
A day after Cavaliers owner Dan Gilbert hinted he might be interested in moving the national headquarters of Quicken Loans to Cleveland, business leaders and public officials spent Friday trying to determine how serious his overture is.
The leaders said they were unaware that Gilbert might consider moving his 3,500-employee company from suburban Detroit to Greater Cleveland until reading about it in Friday's Plain Dealer. Gilbert mentioned the headquarters move in an interview about the April 3 opening of Quicken's 300-employee loan center in downtown Cleveland.
http://www.lsj.com/apps/pbcs.dll/article?AID=/20060325/NEWS04/603250335/1005/opinion
Granholm urged to toughen curriculum
Local roundtable supports new grad standards
As lawmakers work out details of new high school graduation requirements, Gov. Jennifer Granholm listened to opinions Friday at Gardner Middle School.
Michigan State University students, Lansing school leaders and an official of biotechnology firm Neogen Corp. said setting higher expectations will give more kids what it takes to get through college and to a competitive career.
http://www.mlive.com/news/statewide/index.ssf?/base/news-7/1143232806274860.xml&coll=1
Governor wants high schoolers to face tough class before facing changed world
LANSING -- Gov. Jennifer Granholm said Friday that she didn't take Algebra II, a class she wants to require for all Michigan high school students.
But, she said, the world has changed since she was in high school.
http://www.freep.com/apps/pbcs.dll/article?AID=/20060324/NEWS11/60324017
Democrats, labor drop minimum wage petition drive
Sponsors are pulling the plug on a petition drive to raise Michigans minimum wage, as Gov. Jennifer Granholm prepares to sign into law Tuesday an even higher minimum wage than the campaign sought.
A campaign to raise the minimum wage from $5.15 an hour up to $6.85 an hour is no longer needed, now that the Republican-controlled Legislature approved a $6.95 an hour base wage 10 cents higher said John Freeman, director of the Michigan needs a Raise petition drive.
http://www.foxnews.com/story/0,2933,189068,00.html
Cheney Blasts Democrats for Calling Bush 'Dangerously Incompetent'
WASHINGTON — Vice President Dick Cheney blasted Democrats on Friday for calling President Bush "dangerously incompetent."
"The leaders of the Democratic Party have stepped into the debate — not with a positive message, but with a slogan proclaiming that our administration is 'dangerously incompetent,'" Cheney said at a Florida campaign event.
How many black Republicans?
They're a tiny minority who mostly choose not to trumpet it too loudly.
The Economist Magazine
Asked why she switched from being a Democrat to a Republican, Carolyn Mason sounds defensive.
"It's a free country," says the former mayor of Sarasota, Fla. "I don't need to ask anyone's permission."
Republicans see this rift as an opportunity. The party is grooming more than 50 black candidates for national office this year, says Tara Wall of the Republican National Committee.
The most prominent include two would-be governors, Lynn Swann in Pennsylvania and Ken Blackwell in Ohio, and two senatorial candidates, Michael Steele in Maryland and Keith Butler in Michigan.
http://www.lsj.com/apps/pbcs.dll/article?AID=/20060325/NEWS01/603250345/1001/news
Bernero's budget to cut 73 city jobs
$108 million proposal also would close 2 golf courses
Waverly and Red Cedar golf courses will close, 73 full-time city positions will be eliminated, and $200,000 in funding to fix roads and sidewalks will be cut.
They are just a few parts of Mayor Virg Bernero's plan to offset Lansing's record $11 million deficit this budget year.
http://www.lsj.com/apps/pbcs.dll/article?AID=/20060325/NEWS01/603250333/1001/news
Files reveal Detroiter's terror concerns
The late Max Fisher had sought FBI protection in 1972
WASHINGTON - Days after the Israeli hostage crisis at the 1972 Munich Olympics, Detroit oil and real estate magnate Max Fisher sought security protection from the FBI for a series of fundraising trips for President Nixon, according to newly declassified government records.
Fisher, a leading philanthropist who died in March 2005, told authorities that friends had warned him that his status as a Jewish leader in the United States and his ties to Nixon made him "a logical target for terrorist attack by Arabs or Arab sympathizers," the FBI memo said.
http://www.lsj.com/apps/pbcs.dll/article?AID=/20060325/NEWS01/603250329/1001/news
Windsor-Detroit bridge raises alarms
Busiest crossing can tie up much of U.S.-Canada trade
DETROIT — Thousands of cars cross the border between Detroit and Windsor, Ontario each day — and that’s not even counting the ones that have drivers at the wheel.
These are vehicles fresh off the assembly line, as well as parts on their way to become vehicles. A steady stream of shipments flows both ways over the border as part of the regular course of business for the auto industry. Most of it travels over a single, privately owned, four-lane bridge.
http://www.nytimes.com/2006/03/25/politics/25bush.html?_r=1&oref=slogin
Bush, on the Road, Adds to G.O.P. War Chest
INDIANAPOLIS, March 24 — President Bush took to the campaign trail Friday, raising $1.2 million for two of his party's most vulnerable incumbents: Representative Mike Sodrel of Indiana and Senator Rick Santorum of Pennsylvania.
http://www.nytimes.com/2006/03/25/politics/25censure.html
Senator Sets Hearing on Censure of Bush
WASHINGTON, March 24 — The Senate Judiciary Committee has set a hearing for next Friday on the call by Senator Russell D. Feingold, Democrat of Wisconsin, to censure President Bush for his approval of a program to allow electronic eavesdropping without warrants.
http://www.nytimes.com/2006/03/25/international/europe/25belarus.html
U.S. and Europe Plan Sanctions Against Belarus
MINSK, Belarus, March 24 — The United States and Europe said Friday that they would impose sanctions against President Aleksandr G. Lukashenko of Belarus and other top officials for cracking down on a peaceful protest over his re-election, which was widely seen as a sham.
http://www.nytimes.com/2006/03/25/international/europe/25scene.html
Defiant Belarus Opposition Shifts to a Jailhouse Wall
MINSK, Belarus, March 24 — The young man stood by the prison wall and read the names to a crowd of family members.
"Vitushka," he said. "Ten days."
"Vinogradov," he said. "Ten days."
"Marchuk," he said, and repeated the same jail sentence, written on a scrap of paper he said the opposition had managed to smuggle out.
http://www.nytimes.com/2006/03/25/international/europe/25spy.html
U.S. Inquiry Finds Russians Passed Spy Data to Iraq in '03
WASHINGTON, March 24 — Captured Iraqi documents describe a Russian spy operation that was aimed at the United States Central Command in the early days of the American invasion of Iraq in 2003, according to a new American military report. The report says information on war plans and troop movements was passed through the Russian ambassador in Baghdad.
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/24/AR2006032401781.html?sub=AR
Bush Shows Strategy for Keeping Hill Majorities
Democrats Assailed On National Security, As Well as the Economy
By Jim VandeHei
Washington Post Staff Writer
Saturday, March 25, 2006; Page A03
INDIANAPOLIS, March 24 -- President Bush on Friday provided a preview of his two-front strategy for protecting the Republican congressional majority in an ominous political climate: hammer Democrats on national security and the economy, and raise millions of dollars for embattled GOP candidates such as Rep. Michael E. Sodrel (Ind.).
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/24/AR2006032401621.html
Not By Math Alone
By Sandra Day O'Connor and Roy Romer
Saturday, March 25, 2006; Page A19
Fierce global competition prompted President Bush to use the State of the Union address to call for better math and science education, where there's evidence that many schools are falling short.
We should be equally troubled by another shortcoming in American schools: Most young people today simply do not have an adequate understanding of how our government and political system work, and they are thus not well prepared to participate as citizens.
http://www.humaneventsonline.com/article.php?id=13488
Abramoff Clearing Delay
by Robert Novak
Disgraced lobbyist Jack Abramoff has advised friends that he has no derogatory information about former House Majority Leader Tom DeLay and is not implicating him as part of his plea bargain with federal prosecutors.
http://www.humaneventsonline.com/article.php?id=13485
To Punish or Not to Punish
Here's the state of American justice right now:
-- Andrew Selva, 46, confesses to raping two young boys in Ohio and is sentenced to probation by Judge John Connor, who believes Selva has a curable "disease."
-- Debra LaFave admits to having sex with a 14-year-old boy in Florida but does not receive prison time. The 25-year-old LaFave was a teacher at the school at which she seduced the student.
-- Andrea Yates murdered her five children by drowning them one by one. A Texas jury found her sane and very guilty. She was sentenced to life in prison. But the conviction was overturned because an expert witness falsely testified about a TV program that had little to do with the crime.
http://www.freep.com/apps/pbcs.dll/article?AID=2006603250323
Health care threatens to swallow city budget
$173-million hike in costs is projected
Detroiters already beset by dwindling services face a looming new threat to their quality of life: Rising employee health care costs that are projected to devour nearly a third of the city's operating budget in the next three years.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20060325/AUTO01/603250334
GM buyouts will further change the face of the U.S. auto industry
Similar buyouts predicted at Ford, auto suppliers; exodus weakens clout of UAW
Dee-Ann Durbin / AP Auto Writer
DETROIT-- For a U.S. auto industry already undergoing a sea change, General Motors Corp.'s offer to buy out more than 100,000 autoworkers will only bring more upheaval that could result in weaker unions, thousands of jobless Baby Boomers and higher sticker prices on vehicles, eventually.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20060325/AUTO01/603250386/1148
Flint losing last links to auto industry security
Residents wonder if there's a way to rebound as the population has shrunk along with GM's presence
Dana Hedgpeth and Neil Irwin / The Washington Post
FLINT, Mich. -- It was here, 70 years ago, that an epic union showdown with General Motors Corp. laid the groundwork for the job-for-life economic arrangement American autoworkers have lived under ever since.
It is here, today, that one can see most vividly the end of that era, in the form of block after block of leveled factories and boarded-up storefronts. Now, city leaders and Flint residents are left to weigh what future there could be for a city so deeply tied to an industry in decline.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20060325/POLITICS/603250335/1022
Granholm signs abortion ultrasound law
Doctor must give patient the option to see a picture of the fetus before performing abortion
Associated Press
LANSING -- Doctors who order ultrasound imaging for women considering an abortion will have to give them the chance to see the ultrasound under legislation signed Friday by Democratic Gov. Jennifer Granholm.
The law allows, but does not require, clinics to do an ultrasound exam.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20060325/POLITICS/603250343/1022
Saad: 'It made sense for me to step aside'
Michigan judge withdrew nomination from appeals court because he recognized it would not pass
WASHINGTON-- Michigan Appeals Court Judge Henry Saad said Friday he withdrew his name for a seat on the federal appeals court because he recognized his nomination would not advance in the Senate.
"At some point you address the inevitability of a situation and I think it is at some point incumbent upon someone to say this isn't the time and this isn't the place," Saad said in an interview with The Associated Press.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20060325/POLITICS/603250423/1022
Most political activity on Internet exempt from new rules
Zachary A. Goldfarb and Thomas B. Edsall / The Washington Post
WASHINGTON -- The Federal Election Commission released proposed rules late Friday that leave almost all Internet political activity unregulated except for the purchase of campaign ads on Web sites.
GONGWER
REPORT NO. 57 VOLUME 45 FRIDAY, MARCH 24, 2006
ON S.B.T. THERE’S NO GETTING ALONG, AT LEAST BEFORE THE ELECTION
While Michigan’s economy will play the most important roll in elections this year, the idea of figuring out a replacement for the state’ Single Business Tax, should a repeal move forward via governor’s pen or more presumably an initiated law by petition, isn’t likely to happen before the fall elections. GOP lawmakers have established a deadline 21 months away to come up with a solution under repeal legislation, the Michigan Chamber of Commerce does not plan to come out with its own proposal or proposals until the fall, and Governor Jennifer Granholm renews her pitch for her 2005 plan that lawmakers ditched.
The situation sets up Ms. Granholm and her Republican opponent Dick DeVos to present their economic plans for the state going into the November election. So far, Ms. Granholm is sticking to her 2005 proposal that slashed the tax rate from 1.9 percent to 1.2 percent and provided personal property taxes credits as among the ways to help manufacturers but raised taxes on other sectors such as insurers. What emerged was a more modest tweaking for $600 million in tax cuts spread over several years.
Mr. DeVos has joined Republican leaders in deeming the SBT a “job-killer” but has said his economic plan is forthcoming, when voters are ready to listen.
When Ms. Granholm faced Lt. Gov. Dick Posthumus in her 2002 gubernatorial bid, both candidates agreed something needed to be done to fix the business tax climate of the state, but the impetus of a gloomy economy to the likes of General Motors and Ford layoffs by the thousands and the announcement of bankruptcy by Delphi were not in the election mix as much as they are this go-around.
It doesn’t look like a compromise is being worked out on the SBT repeal bill (HB 5743), which is awaiting concurrence in the House on a Senate substitute that includes an instruction to the Governor’s Council of Economic Advisors to come up with a replacement plan by January 1, 2007.
Ms. Granholm, reiterating her contention that simply eliminating the tax without replacement revenue is dangerous, said waiting until the end of 2007 to come up with a new business tax structure will hurt the state’s ability to attract business.
Speaking to reporters on Friday at a school where she held a roundtable on mandatory curriculum, the governor said the reality is that the SBT is “going away or will be significantly modified in some way, shape or form” but taking that step without having a new structure in place creates too much uncertainty for business.
The governor said she told Oakland County Executive Brooks Patterson she would sign a repeal “if we can agree that you’ve got to replace it with business revenue and not cut public safety, health care and education.”
Asked about meeting with legislative leaders to devise a proposal, Ms. Granholm pointed to her SBT restructuring plan of last year that the Legislature rejected saying, “I have said repeatedly, come and talk to me about a replacement. Eliminating the tax and not proposing any way to deal with it until the end of 2007 creates a very unstable environment.”
A spokesperson for Senate Majority Leader Ken Sikkema (R-Wyoming) said the repeal legislation actually reduces uncertainty for businesses since existing law calls for repeal and no replacement or plans for replacement at the end of 2009.
Ari Adler said it is the governor who has an economic council capable of devising a new plan, which he said must meet a litmus test of being pro-growing and making Michigan a more competitive state. He said the problem with discussing a replacement plan with the governor is that “it’s been difficult to get any kind of meeting with the governor’s office. What Ken has said if you want to get people to the table, take away $2 billion from the state budget.”
House Speaker Craig DeRoche (R-Novi) has moved ahead on several fronts to devise a new business tax, said spokesperson Matt Resch, including hearings by a Tax Policy subcommittee and a commissioned study on what other states are doing. And he said the deadline does not mean that the speaker may not come up with a proposal even earlier.
As for a message of an unstable business environment if the tax is repealed now, he said, “We can’t send a worse message than we are now with the single business tax. Getting rid of the SBT and working toward a replacement that is fair will send a message that Michigan is finally sincere about being a place that is more competitive to do business in.”
Mr. Patterson’s petition drive to repeal the SBT by December 31, 2007 is underway and sources contacted for this story said it is likely an initiated act, which if approved by the Legislature cannot be vetoed by the governor, could clear the Legislature should it need to. Republican leaders have made sure to keep the deadline on the repeal exactly the same as Mr. Patterson’s proposal, although they did add some language that a replacement would not affect the state’s other major taxes, like the income and sales tax.
Mr. Patterson has said he supports a business tax that would create $1.3 billion in revenues for the state, a cut from the $1.8 billion the SBT brings in now. Interestingly enough, that is the exact cut proposed by the Detroit Regional Chamber of Commerce through its business licensure system, which would range from $1,000 fee for company with $350,001 to $500,000 in annual profits to no more than $1 million for larger firms which would make up the bulk of the state revenue.
Like the SBT, the plan would exempt businesses from paying that fee if it has annual sales of less than $350,000. For the most part, the business community seems to agree that that exemption should remain under whatever replacement is made, since small businesses show the most growth potential in an economy.
The group does pay taxes, said Barry Cargill of the Small Business Association of Michigan, which is a common misconception since they don’t fall under the SBT threshold, but they do have to pay income and sales taxes, accounting for about one-third of sales tax revenue.
But while economists come to lawmakers, particularly as the House Tax Policy Restructuring Subcommittee meets to discuss the issue, they continually say that a broad-based tax at a low rate is good policy for the state in looking to replace or rejuvenate the SBT.
The language in the Senate-passed bill barring consideration of sales taxes as replacement revenue has not stopped discussion of that option.
Tom Clay, senior research associate with the Citizens Research Council of Michigan and a former deputy treasurer for the state, argued Friday on Michigan Public Television’s Off The Record that a sales tax on services is needed to bring Michigan’s tax structure into the 21st Century.
“The services we don’t tax, in dollar volume, are greater than all of the things we do tax under the sales and use tax,” Mr. Clay said. He added that there might be a pull to exempt medical and educational services as well as the business services provided between companies because that would give an unfair advantage to businesses with internal service providers.
Former state treasurer Doug Roberts, who now directs Michigan State University’s Institute for Public Policy and Social Research, said he agrees that services in the state should be taxed.
SBAM supports a tax on services, which would hike the sales tax in exchange for no business tax, but selling the idea to a constituent that the price tag on a new sofa or car will increase is not something many lawmakers are jumping up to do, especially in an election year.
In the end, while having a broad-based tax in Michigan is supported by most economists, the fact that the state has not operated with such a system means that a change will create a new pack of winners and losers.
Another proposal in the realm of replacements includes a business activities tax, but what will all be included under an activity would still have to be decided. Keith Carey, of the National Federation of Independent Business of Michigan, said that if the state were to adopt a corporate profits tax, lawmakers would have to select which activities of a business would be taxable, such as providing healthcare and 401(k) retirement plans.
Mr. Carey said that the NFIB is collecting a list of the what its members would like to see in a replacement and what they do not want to see, with the emphasis that what does become the SBT proxy should not be based on keeping state revenue stable but something that fosters economic development.
“We’ve been approaching the appropriations process with the idea that government has a spending problem not a revenue problem,” he said, adding that the NFIB and Mackinac Center for Public Policy worked out a study of areas the state budget could be cut.
The Mackinac Center’s Jack McHugh has come out with a proposal that would replace the SBT with nothing, an idea shared by the repeal bill’s sponsor, Rep. Leon Drolet.
That proposal includes requiring items such as co-pays and preferred provider networks for public school health insurance ($422 million), privatization of the state’s prisons ($192 million), changing the per-pupil foundation grant to allow for the money to move with the student and requiring universities to cut costs ($70 million), and reforming Medicaid and welfare ($240 million). The proposal would cut state services and with it the budget to the total of $1.855 billion, including an assumed savings of $300 million based on elimination of the SBT having a dynamic effect on the state’s other taxes.
Providing Michigan with an overall economic boost will not occur with elimination of the SBT along with a replacement that is revenue-neutral, Mr. Clay said, however he also countered that any tax cut amounts to cuts in programs and services the state offers, including support for higher education, prisons, healthcare for the poor and human services.
Mr. Clay said Ms. Granholm now has the power to determine the timing of the SBT repeal, adding, “There are considerable risks if the governor signs the bill if there is no quid pro quo down the line.”
Perhaps the whole SBT replacement debate could mimic its counterpart in 2005, as long as the same political players are in the game, in that it becomes a compromise of proposals.
While there are limited options out there, Mr. Roberts said lawmakers and the governor could do a combination of having a small income tax and gross receipts tax on businesses. The biggest debate on change will be the issue of revenue-neutral versus non-revenue neutral proposals, he said.
Michigan’s is viewed by most tax climate indexes as uncompetitive because of its value-added factor, but the states that rank well in those indexes also do not have a similar reliance on manufacturing or investment in public education, said Mr. Roberts. Pennsylvania is the closest, Mr. Roberts gauged, which was ranked by the Washington, D.C.-based Tax Foundation 16th in the nation as far as overall business tax climate.
States that continue to excel and rank highly on these indexes according to the Tax Foundation are states such as Wyoming and South Dakota, which have no corporate income or individual income tax; Alaska, which has no sales tax or individual income tax; Florida and Texas, which have no individual income tax; Nevada, which has no corporate income tax and New Hampshire, Delaware, Oregon and Montana, which have no sales tax.
Tricia Kinley, with the Michigan Chamber of Commerce, said the organization is soliciting all opinions on what would constitute a replacement, but added that the full Chamber board still has to vote in April on supporting the repeal of the SBT in the first place. “We’re going through a very deliberative process.”
GRANHOLM VETOES BILLS ON UNIONIZED HEALTH FACILITIES
Legislation pushed by Republicans who wanted to block rules that could favor unionized group care homes and nursing homes was vetoed Friday by Governor Jennifer Granholm, who said they would have placed arbitrary barriers on the ability of the state to ensure safe and quality care.
In vetoing SB 1027, SB 1028, HB 5744 and HB 5745, she said the administration and future administrations need to retain the authority to determine whether rules are needed to assure senior citizens and the disabled are receiving safe and quality care by well-trained and adequately compensated employees.
Ms. Granholm also said her veto protects the Executive Branch from encroachment by the Legislative Branch of government.
“If at some point it is determined that administrative rules are needed to assure that workers providing care to senior citizens and the disabled are receiving the wages and benefits necessary to assure quality care and safety, the Administrative Procedures Act of 1969 affords ample opportunity for legislative review and reaction,” she said in her veto letters to the Senate and House.
Sen. Bill Hardiman (R-Kentwood), sponsor of the Senate bills, said his concern was potential favoritism for unionized facilities “at the expense of affordable quality care for vulnerable adults.”
“Michigan families demand that their loved ones have safe, quality care, which is what my legislation tried to ensure. Instead, the governor’s veto means her administration can go forward with costly regulations that would favor facilities with collective-bargaining agreements,” he said.
ULTRA SOUND: As previously indicated, the governor also signed a bill requiring
abortion providers to conduct an ultrasound prior to the procedure and to provide those images to the mother.
The governor’s office had said the bill (HB 4446, PA 77) is largely a statement of legislative intent that would not affect current practices.
HOUSE BILL WOULD CUT STATE INCOME TAX RATE
Legislation that will be introduced in the House shortly would lower that state income tax flat rate from 3.9 percent to 3.5 percent and has the backing of at least a dozen Republicans, its sponsor said Friday.
Rep. Shelley Taub (R-Bloomfield Hills) said because she expected the governor to veto the SBT repeal, she decided to introduce a rate-cutting bill that would affect everyone.
“There’s an aura of distaste like we just can’t move forward,” she said of Michigan’s “single-state recession.”
Providing for a cut to the rate would allow people to decide what to do with their own money – save, spend, or invest – all three are good for people and good for the economy, Ms. Taub said.
While legislation has been introduced in both chambers to provide for a state earned income tax credit, similar to what’s available at the federal level, there has been no rate cut legislation introduced in this session until now.
Matt Resch, spokesperson for House Speaker Craig DeRoche (R-Novi), said he had not seen the specifics of the proposal yet, but as always, Mr. DeRoche would review the legislation.
GRANHOLM OFFICIALLY ANNOUNCES SPECIAL ELECTION: Governor Jennifer Granholm has officially announced the special election for the House 69th District, which has been vacated by now-Sen. Gretchen Whitmer (D-East Lansing). The special election will be held concurrently with the August primary and November general election.
