The death march of Michigan
As if the State of Michigan didn't have enough problems already, the State Legislature has made it much worse. The legislature has passed an interim budget that contains significant tax increases. While the legislature is still working on the details of the budget, the income tax rate rose from 3.9 percent to 4.35 percent. But far worse is the introduction of taxes on services. The new service tax will affect twenty-three categories of services. Included on that list of services are consulting and administrative services. While the details are being hammered out, it is likely that this will affect my company. I will have to spend hundreds of dollars (maybe even thousands) annually implementing compliance. Worse, I may have to lower my Michigan rates to absorb the new service tax cost to my commercial customers.
If Michigan ever wanted to do one thing to kill the budding services and technology industries in the state, they seemed to have found it. The state hasn't realized that the old monolithic corporate model (like General Motors) is a dinosuar. Instead, new industries are based on groups of smaller companies. Technology companies have payroll companies take care of their payroll, instead of paying someone to sit on staff and handle payroll. Industrial companies pay technology consulting firms to implement their computer networks. In general, the successful companies of the modern era focus on their primary business, and have other companies provide their non-core services.
Governor Granholm showed her true colors as being the ultimate tax and spend Democrat. The state government almost shut down completely because the Governor refused to sign any budget (even an interim one) that did not have massive tax increases. And rather than increase the income tax rate up past 4.4 percent, the state chose to split the taxes between the income taxes and the service taxes. My guess is that the legislature is hoping that this shell game ensures that people do not realize how much additional taxes they are paying. Personally, I hope that some of the new recall efforts (like Recall Granholm) are successful, and that the citizens of Michigan send some of these idiots in the state government out the door.
My fear is that this lunacy will start the death march for the Michigan economy. The old industrial sector companies are dying, and the new technology and service companies will be less likely to want to establish a presence in Michigan. Pretty soon Michigan will no longer be in the"Rust Belt". Instead, it will be in the "Nothing Belt".
As a side note, the salary for Michigan's governor is the third highest in the nation. If the state needs to cut budgets, perhaps the legislature can start there?
If Michigan ever wanted to do one thing to kill the budding services and technology industries in the state, they seemed to have found it. The state hasn't realized that the old monolithic corporate model (like General Motors) is a dinosuar. Instead, new industries are based on groups of smaller companies. Technology companies have payroll companies take care of their payroll, instead of paying someone to sit on staff and handle payroll. Industrial companies pay technology consulting firms to implement their computer networks. In general, the successful companies of the modern era focus on their primary business, and have other companies provide their non-core services.
Governor Granholm showed her true colors as being the ultimate tax and spend Democrat. The state government almost shut down completely because the Governor refused to sign any budget (even an interim one) that did not have massive tax increases. And rather than increase the income tax rate up past 4.4 percent, the state chose to split the taxes between the income taxes and the service taxes. My guess is that the legislature is hoping that this shell game ensures that people do not realize how much additional taxes they are paying. Personally, I hope that some of the new recall efforts (like Recall Granholm) are successful, and that the citizens of Michigan send some of these idiots in the state government out the door.
My fear is that this lunacy will start the death march for the Michigan economy. The old industrial sector companies are dying, and the new technology and service companies will be less likely to want to establish a presence in Michigan. Pretty soon Michigan will no longer be in the"Rust Belt". Instead, it will be in the "Nothing Belt".
As a side note, the salary for Michigan's governor is the third highest in the nation. If the state needs to cut budgets, perhaps the legislature can start there?
posted by David at 10/01/2007 08:27:00 PM
2 Comments:
Why can't anyone go through our government, find waste, and cut it? Yesterday a whole host of calls for recalls were reported in the news. The Detroit Free Press reported that "Granholm, at a Monday news conference, said the prospect of recall campaigns against those who heeded her call for higher taxes makes her angry, and that she would ask voters not to sign such petitions.
The tax votes were "the toughest votes of their lives," she said, for legislators who "came to Lansing to fix problems."
"They don't deserve to be recalled. They deserve to be patted on the back.""
I don't think anyone will actually be recalled, and that is not my point. My point is that Granholm said they deserve to be patted on the back because it was the "toughest" vote they ever cast. Since when do we give pats on the back for taking the easy way out and acting like it was tough? I'd be happy to pat them on the back if they actually did the right thing and cut the budget like I have to do when I don't have enough money to cover my expenses. I'd give anyone a pat on the back for that, regardless of their party.
Our governor and legislators did a terrible job and I do not approve of what they did to resolve this problem. They all deserve to lose their jobs in the next election.
Oh, I forgot. Granholm said the legislators "came to Lansing to fix problems." As far as I'm concerned, they cause way more problems than they ever fix. The legislature should go back to being a part-time legislature so they have less time to legislate all my money away to wasteful or poorly managed programs.
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