Michigan is run by the Republican Party, and it looks like the state's government is set to continue policies that cut taxes for busineses and cut income taxes--all of which primarily benefits the better off--while drastically cutting back on things that the state should be funding, such as public higher education.
The first budget under Gov. Snyder gave business a tax cut o $1.8 billion by eliminating the Michigan Business Tax and replacing it with a corporate income tax that doesn't apply to most businesses. The GOP dominated legislature and government coupled the tax cut for business with an increase in taxes on pensioners and a reduction in some personal tax credits and deductions, so that individuals will now pay $1.4 billion more in 2013 than in 2012. Michigan has a flat individual income tax, which is scheduled to be cut from 4.35% to 4.25% next January. The House speaker, Jase Bolger, wants to accelerate the cut, moving it up to July, which would cost the state about $96 million. Typical taxpayers making $50,000 would see only $23 more in their pockets from that cut.
Meanwhile, the state is cutting its support for public education. Significant cuts were made to K-12 education and public colleges and universities are dealing with multiple years of cutbacks to support for higher education. Part of the way that cutback has happened has been in making funding provided to universities one-time. Money allocated in that way can't be used for anything permanent but only for gap filling, making it very hard for long-term planning necessary to support classes and research. Wayne State University, located in Detroit and serving the southeast region and with many students who try to work and go to school and thus take longer than students from well-heeled middle class families, suffers particularly from that kind of funding. It generally means more use of part-time faculty rather than hiring of new tenured faculty.
Now, you may be one of those people who think that's just fine. There's been a lot of criticism of tenure lately, and many people who think tenured faculty don't really work hard. But funny thing. When Wayne did some studies of student success to try to determine what factors make a difference, it learned that students do best when they are taught by tenured faculty rather than adjuncts! That's likely because tenured faculty are committed to the institution, are around more to deal with students beyond the classroom, and have an interest beyond just the subject matter of the class, bringing their research and scholarship into the classroom.
What if Michigan took the $96 million that Bolger wants not to collect and instead used it to fund public education and to build a state of the art surface rail system for the city of Detroit? I'd gladly give up my tax cut for that, and I expect many another Detroiter would too. The problem, of course, is that the rest of the state doesn't understand how important it is to help Detroit and to create modern public transportation systems. In the long run, the entire state would benefit and it would be well worth the additional tax dollars.
But I'm not holding my breath.