Help to End the One-State Recession. Vote Yes on Proposition 2

I think that Michigan is in a kind of "One state recession," and in order to dig ourselves out of it we need to level the playing field and give everyone an opportunity to contribute to a recovery by eliminating arbitrary impediments to a market economy that were motivated to give power to narrow special interest groups in order to support one political party over another. Union work rules and affirmative action have both outlived their usefulness and both are a drag on the economy. It is critical to the future of Michigan that neither become institutionalized as that most dreaded of taxation motivators, the "entitlement." Lets begin the process of bringing Michigan's economy back with a first step: Vote yes on Proposition 2.

Louisiana had Katrina. Michigan has arbitrary work and hiring rules that drain the state's treasury and bankrupt its businesses all to benefit a minuscule proportion of those that the rules were intended to uplift. The system is broken, and if we don't fix it then Michigan will become the Mississippi of the 21st century, a forgotten backwater where wealthy outsiders and sovereign internal nation-states collect worker's paychecks and pay back as little as they can to the state. Vote Yes on Proposition 2 to start reversing the slide.

Read the following article from today's Washington Post and weep for Michigan:

Most States Have Budget Surpluses



Some Find Creative Uses for Cash



By Lois Romano Washington Post Staff Writer




It’s tantamount to finding an unexpected wad of cash buried in the pocket of an old jacket - utter euphoria at the windfall, mad money to splurge on a one-time extravagance.
Only this find is breathtakingly huge.
For first time since Sept. 11, 2001, the vast majority of states reported saving an average of 10 percent of their budgets, one of the highest percentages of unspent money in decades. The $57 billion in unexpected revenue has afforded states an opportunity to find all sorts of creative ways to spend and save their cash, according to a report released this week by the National Conference of State Legislators.
New Mexico has undoubtedly targeted the most unconventional project to lavish money upon - a space launchpad for future commuter orbital excursions. (No, the spaceport is not in Roswell, home of the rumored 1947 flying saucer.) Nationally, the states’ surplus money is a 25 percent increase from the previous fiscal year and a welcomed boost after a fiveyear slump. The report notes that year-end balances are “widely considered one of best indicators of state fiscal health.”
“It’s sort of breather . . . like the eye of the storm, before a lot of serious needs kick in,” said Corina Eckl, co-author of the report for NCSL. “Overall revenues are not keeping up with spending and these states are still in need of a lot of resources for items such as funding No Child Left Behind and aging prison facilities.”
Some states have earmarked the money for onetime expenditures, or they are using it bolster reserves and rainy-day funds. Across the board, education is the largest recipient, with 24 states sending money to kindergartenthrough-12th-grade education and 20 spending on higher education, the report said.
Alaska invested $300 million into its Public Education Fund and had another $300 million to place in a new reserve fund. Wyoming used its surplus for natural resources, putting $200 million toward its Permanent Mineral Trust Fund, while New Mexico placed $40 million of its $800 million windfall into its Water Trust Fund. Oklahoma invested some money into cancer and diabetes centers, and North Carolina found veterans nursing homes that needed money.
Arizona ended up with an extraordinary $1.5 billion more in revenue than expected, money that was generated largely from the real estate boom. The state used about a third of the money to reduce taxes, some to promote the state and some for highway construction, and it still had a solid chunk for the rainy-day fund. “It’s given us the opportunity spend money on things that we would normally let slide, such as ongoing repairs” for state property, said Richard Stavneak, director of the Joint Legislative Budget Committee.
A number of states chose to sock away the money in rainyday funds. Maryland sent $593 million. Connecticut added $440 million - and used an additional $250 million to catch up on contributions to the teachers pension fund. Georgia’s rainy-day fund will receive $430 million.
Nationwide, state lawmakers have been struggling with budgets since the 2001 attacks triggered an economic downturn. After several years of fast-declining revenues, states were conservatively planning based on scaled-back expenditures. Even as revenues started to climb, states were reluctant to count on the money and based budgets on lesser income. As a result, all but five states - Illinois, Kansas, Louisiana, Michigan and Wisconsin - reported surpluses.
The study noted that revenues had been projected to grow by only 2.7 percent for last budget year, but they ended up growing by nearly 7.7 percent. Because state budget drafts forecast 18 months in advance, it is often difficult to accurately predict actual revenue.
In New Mexico, the state was bestowed with unexpected revenues from oil and gas leases, and in Connecticut capital gains taxes proved more generous than expected.
“We saw it coming, but what we didn’t see coming was the bounce that we got through capital gains revenues,” said Susan Shimelman, director of Connecticut’s Office of Fiscal Analysis. “So it wasn’t budgeting. It’s sort of a largess.”
Overall, state budget directors are not ready to say that things have turned around such that states can depend on similar revenues in the current fiscal year. And some note that with the windfall comes a whole new set of issues.
New Mexico, a relatively poor state, has approved $100 million for a partnership with Richard Branson’s Virgin Galactic to start orbital passenger flights from the state as early as 2009. While the public is solidly behind Democratic Gov. Bill Richardson’s push for the spaceport as a source of revenue for the state, there are always constituencies that wonder whether the money could have been better spent on immediate needs.
“Folks come out of the woodwork with all kinds of ideas and images of where we should spend,” said David Abbey, director of New Mexico’s Legislative Finance Committee. “It puts tremendous pressure in the legislature to fund everything. The challenge becomes separating the good ones from the gleam in someone’s eye.”