It seems that Jennifer Granholm has taken a page from the Bob Rae/Floyd Laughren playbook and has passed a massive tax increase to cover the state budget deficit. Michigan, struggling to keep jobs in the state with a declining manufacturing and job base, is now in a worse position thanks to the Democrats in Lansing. Among those goodies passed recently were:
1. An increase of the personal income tax from 3.9 to 4.3%.
2. Expanding the 6% sales tax to cover a variety of services.
Let's see now. Bob Rae, the socialist premier of Ontario was unexpectedly voted a majority government for his NDP party in 1990, when the recession began. Their answer was a massive increase in welfare spending and tax hikes, which exacerbated the situation, further worsening the economic condition of Ontario.
Rather than do a bottom up re-evaluation of all government spending and setting priorities, Granholm and her Democratic co-conspirators in the legislature jacked up taxes. They seem to forget that it is businesses that create jobs in the state, and no private sector jobs mean no lush government jobs for their supporters. But hey, why let something like history and economics get in the way of a good tax hike?
The exodus of jobs and people out of Michigan will only accelerate with this, and it makes my decision to leave Michigan look better with the passage of time.
The good news is that if history is any indicator, in 2010 we will have the Michigan verson of Mike Harris as governor.