Michigan must return to
what made it great

The question I have asked myself over the last year was, “will increasing taxes on individuals, families, seniors, and businesses help or hurt Michigan’s struggling economy to recover from being in a one state recession?” Research done by myself and staff coupled with e-mails from my constituents convinced me the answer was “no”.

I especially considered the fact that Michigan has lost more than 207,000 jobs, a decline of 4.2 percent, while the rest of the nation has seen an increase in jobs of 6.8 percent. Giving this unfortunate reality I voted “no” on increasing taxes because I won’t kill more jobs.

The heart of Michigan’s economic misery is twofold. First, we tax our people too much. From April 2000 until October 2006, the five states having the lowest general corporate taxes have increased jobs by 14.3 percent. The three states having no general corporate tax at all—Nevada, Wyoming and South Dakota—have seen a 17.6 percent job growth.

Unfortunately, during that same time, Michigan’s Single Business Tax was in effect. Thankfully the SBT, a burdensome tax that was widely despised for most of the last 30 years both by Michigan business owners and legislators, was replaced with a more equitable business tax this past summer. But on the heels of this replacement comes a massive $1.48 billion tax increase, courtesy of the Granholm administration. So it appears we take one step forward, and then two back. We simply tax our people too much.

Second, we spend too much money! Michigan’s budget was short $1.75 billion. Governor Granholm and legislative Democrats put forth a plan that would have raised taxes $2.1 billion and added several new spending programs.

Republicans control only 1/3 of state government: the state Senate. Although we passed a balanced budget with all cuts and reforms, the Democrats’ 2/3 of government rejected it. They wanted to pass a budget with no cuts and no reforms whatsoever.

The governor was adamant and insistent that any solution had to include “new revenue”—in other words, a tax increase—or she would shut down the government. Without Senate Republican involvement, the increase in taxes would have been higher and the painful impact on the state’s working families deeper.

Senate Republicans always sought to enact reforms and reductions in spending. Overwhelmingly, citizens in the 15th district that contacted me rejected increasing taxes to resolve the budget impasse. My “no” votes against increasing the income tax from 3.9 percent to 4.35 percent and extending a 6 percent service use tax to more than 56 services reflect the sentiment of my constituency given Michigan’s troubling economic situation.

Sadly, the deadlock had to be broken by a combination of cuts, reforms and revenues. My stance was and is we should have done this without tax increases. My own record on holding the line on taxes and government spending is well-documented. But the Governor made her choice clear: raise taxes or I will shut down the state. Unfortunately, Michigan has taken another step backward.

I am committed to spending my time working with both sides of the aisle to constructively mitigate and hopefully eliminate this new tax burden on our citizens and small businesses. In addition, I will join those who take steps to improve Michigan’s business climate and competitiveness making us, once again, a strong job creator and economic growth engine. More structural reforms and cost savings must be done.

As always, I look forward to your comments. You can contact me by e-mail at senncassis@senate.michigan.gov, or toll free at 1-888-38-NANCY. My website address is: www.senatornancycassis.com.

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State Senator Nancy Cassis, a Novi Republican, represents the 15th Senate District, which includes the townships of Commerce, Highland, Holly, Lyon, Milford, Novi, Rose, West Bloomfield and White Lake; as well as the Villages of Holly, Milford and Wolverine Lake; and the cities of Novi, Northville (the portion in Oakland County), Orchard Lake, South Lyon, Walled Lake and Wixom.