Balancing the Budget on the Backs of Public Employees

MEA Votes E-Newsletter -- Jan. 20, 2010

Just say NO to balancing the budget on the backs of public employees -- again!
Senate Republicans and their leader, Sen. Mike Bishop (R-Rochester), want to solve the state's budget crisis on the backs of public employees -- again.

This week, Republicans unveiled a 10-point plan that includes measures to cut wages by 5 percent for all public employees and require public workers to pay 20 percent of health insurance premiums -- ignoring the fact that school employees alone have saved the state almost $1 billion during the past three years through concessions made locally.
This plan is the Senate GOP's lame entry into a broader effort to fill an estimated $1.6 billion hole in the 2010-11 budget. Legislators on both sides of the aisle are considering major reforms, and Gov. Jennifer Granholm is reportedly also working on several initiatives, including tax reform.There's no doubt that the state budget is a mess -- it has been for a decade. This year's gubernatorial and legislative elections are likely to make this year's budget process even more rancorous.

But before proposing more cuts to police and fire protection, schools, or other vital public services, lawmakers must consider how to get the revenues necessary to provide services that citizens need -- especially strong public schools to prepare students for the jobs Michigan needs. One place to look for such revenue is by examining tax breaks for businesses; currently, too little is known about how effective these incentives are and whether the promised jobs ever materialize. According to the Pew Center, last year Michigan gave away $6.3 billion more in tax exemptions, credits and deductionsthan it actually collected in taxes -- if only some of those programs are found to be ineffective, their elimination would fix part of this huge budget hole. (For more on real solutions, read the next item on "A Better Michigan Future.")
In addition to public employee wage cuts and mandatory health premium payments, the Senate Republican plan calls for up to $663 million in additional education cuts, including a proposal to require competitive bids for all K-12 non-instructional services. The other ideas include further cuts to state departments, Medicaid, and local police and fire. None of these so-called "reforms" fixes our decade-long budget mess, because Sen. Bishop and his colleagues refuse to address the real problem -- Michigan's antiquated tax structure.

Contact your state senator -- especially if they are Republican. Call or write your senator insisting that they oppose the Republican leadership's cuts-only plan because it would devastate -- not help -- tens of thousands of Michigan families and the communities where they live.
Stay tuned for more information on the 2010-11 budget -- Granholm is expected to present her budget proposal next month.