Why I Am Running
"I am running for State Representative because I have a great passion for my community and very strong feelings about our state's direction. I believe that we need to make Michigan the best place in the world to do business."
LIST OF ISSUES
Along with public safety there is no more important function of state government than education. Too often in Lansing when we discuss education we talk about funding levels and tax regimes. We need to get back to the basic question of how we can provide the best education possible for our children. Throughout most of the 40th district, we are blessed with some fantastic public schools. Other communities across the state are not so fortunate.
We need to look at what other states like Florida have done - who under Jeb Bush's strong leadership has made tremendous strides in education - and we need to adopt those reforms. We need to be strategic in how we spend our tax dollars on public education. Too often our public dialogue is focused on K-12. While those are obviously critical years in any child's development, we need to adopt a P-20 model which focuses on a child's educational development from pre-school through graduate studies. Studies show that at-risk children particularly benefit from early childhood educational opportunities. Through public-private partnerships we know that we can provide these at-risk children with educational opportunities at a very low cost. There are no shortage of reforms and innovations that we can bring to Michigan's educational structure.
I am a graduate of public schools and I have three degrees from our state's public universities. We still have the best public universities in the world and we need to maintain them.
We have many excellent public schools in the 40th district, but there is always room for improvement for all public education institutions throughout the state.
Taxes – Eliminate the Corporate Income Tax
We need to make Michigan the best place in the world to do business. In order to make that happen I am proposing a bold reform of eliminating Michigan’s corporate income tax.
In order to fully understand the power and importance of this idea, a quick review of the history of business taxes in Michigan is helpful. In 1976 the state government was looking for ways to increase government revenues to pay for the perpetually growing state government. At the time, the legislature implemented the Single Business Tax (SBT) -- a complex and onerous tax designed so that the business would pay a stable amount of taxes regardless of their revenues or profits. The problem with this system was that business incomes go up and down quite dramatically based on a variety of factors many of them related to economic factors for which business-owners have no control over. A fundamental principle of taxation is that our tax burdens should be based on a taxpayer’s ability to pay. The SBT ignored that principle and the SBT chased businesses out of the state.
In 2007, the legislature chose to replace the SBT with the Michigan Business Tax (MBT), another complex and onerous tax designed again to raise a predetermined level of tax revenue. In practice, when the MBT did not raise tax revenues the Legislature had hoped, they added a 22% surcharge on all businesses taxes! As Governor Rick Snyder has said, moving from the SBT to the MBT was like going from “dumb to dumber.” Finally in 2011, under Rick Snyder's leadership we eliminated the MBT and replaced it with a simple, flat 6% corporate income tax (CIT). The MBT raised about $2.3 Billion. In 2018 the first year that the CIT will be fully in effect, the Michigan Department of Treasury projects that the tax will raise $688 Million. Moving from the MBT to the CIT amounted to a $2 billion dollar tax cuts for Michigan businesses. According to one study, Michigan moved to 7th from 37th in a ranking of states’ business tax competitiveness. With Governor Snyder's leadership, we found a way to maintain our essential state services and cut nearly $2 billion in taxes.
I believe that we can cut an additional $688 million and eliminate ALL BUSINESS TAXES in Michigan. There are only 4 states in the country that do not tax business income. If we want to make Michigan the best place in the world to do business we need to become the fifth. 678 million represents less than 2% of the state budget. We can afford to find these savings while maintaining essential state services. By eliminating the corporate income tax, we can give Michigan a major competitive advantage over our neighboring states. (Indiana and Illinois maintain 8.5% and 9.5% business income tax rates.) Eliminating Michigan’s corporate income tax would be a revenue-enhancing step toward job-creation and economic growth. It would also send a powerful signal throughout the country that Michigan is on the road to being the best place in the world to do business.
In Michigan, we have a large government, but we do not receive commensurate government services. The reason why is that we have too many layers of government.
The State of Michigan has 552 school districts. (Maryland, a state half the size, has only 13!) That's 552 superintendents, 552 assistants to the superintendent, etc. Furthermore, our state and local government employees rank among the top quartile of states in compensation, while Michiganders rank among the bottom quartile in personal income. This does not make sense. I fully support Governor Snyder's call to transform our budgeting process by adopting a “value-for-money” approach to our budgeting process. We must take the following steps:
1) Rather than simply passing a budget every year, based on a slight increase in funding from the previous year, we need to focus our spending by targeting specific outcomes. As a state, we need to decide what our priorities are, then we need to protect spending for programs that work while eliminating funding for programs that do not provide tax payers a good return on investment.
2) We must aggressively transform how we provide government services. Services that can be delivered more efficiently by private entities should be outsourced. When outsourcing does not make sense, we need to consider how services can be consolidated across state, county and local entities. In Michigan we do not necessarily have too many government services, but we have more layers of government than are necessary to provide those services. Through consolidation of services and adoption of best practices throughout the state, we can transform how government services are delivered.
3) Over the last decade the personal income of the average Michigander has decreased by 1.5%. At the same time, the compensation of state and local government employees has increased! We cannot blame government employees for demanding higher pay, the fault lies with the politicians who meet their demands. We need to bring government compensation in line with the private sector. As Michiganders suffer, public employees like the rest of us need to find a way to do more with less. Redoing the overall cost of public employee compensation is essential in order to lower the tax burden on Michigan families and businesses.
Bringing Winning Back To Michigan
Winners don’t quit at halftime, and neither do Michiganders. I am not willing to accept our current business climate or the continued flight of our youth to other states. In 2009 GM and Chrysler were bankrupt and we hit rock bottom. The recovery has begun and we are not looking back. We have taken some good steps to move forward, but we have a lot more work to do.
In Michigan, we must not be afraid of a little hard work, we don't give up and we never back away from a fight. If you knock us down, we get right back up.
Sixty years ago Metro-Detroit was the richest metropolitan area in the country. We can get there again. By working together, we can and will make Michigan the best place in the world to do business. We can and we will bring jobs back to Michigan and give families the opportunity to live and work right here in Michigan.
Reforming Our Regulatory Structures
As the policy director for Rick Snyder's campaign for Governor, I had the opportunity to meet with many of Michigan's business leaders. The single biggest obstacle they said they faced was not taxes; it was the anti-competitive nature of Michigan’s complex regulatory structure. We need to reform or eliminate regulations that inhibit businesses from operating and investing in Michigan. Some business leaders told me that enterprises that they sought to start could not be done in Michigan because of various different regulatory hurdles. One farmer with no record of regulatory violations was told by the Department of Environmental Quality that in order to continue operating his business, he was required to prove every three months that he was in compliance with certain environmental regulations. The burden of proof should lie with the regulator, not the businessman. As Governor Snyder has said, it makes sense every 50 years to see if a regulation still makes sense. We have so many regulations on the books. Rather than adding more regulations as Governor Granholm regularly proposed doing, we need to look at the ones we have and to start aggressively eliminating those that no longer serve a purpose or inhibit economic development.