Sunday, June 29, 2008

Whither Michigan?

The Michigan Department of Labor and Economic Growth has released the state's unemployment rate for May, and it was grim: 8.5%, a 1.6% increase from April. As Rick Haglund of the Grand Rapids News observes, the state government really can do little to stem the loss of unskilled and semi-skilled manufacturing jobs. Certainly not with emergency programs to stimulate one industry or another. It could choose to bring some sanity to the state business and fuel tax structure, perhaps reduce the business tax rate (our fair state chose to add a 22% surcharge to the new Single Business tax, shafted some businesses with tax increases and favored others with reductions, and raised state income taxes in the teeth of our own state's severe Hooveresque!). Governor Granholm has hawked a miriad of "Cool Jobs" schemes (a reference to her "Cool Cities" program"), from IT to medicine to alternative energies to movies. Nothing has really stuck, and for state policy makers there is a very important message in that fact. Perhaps a change of strategy is needed: cut business regulation and taxes, make it brain-dead simple for people with a good ideas to start up a business...and then just stay out of their way.

PS - Tom Shields' column makes the same case for the "State of the Morass".

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