Michigan’s governor is on the brink of making long-term financial decisions for our state’s future in the midst of a nationally watched re-election campaign. The challenge of creating a working budget for our state will only be amplified by the need to curry favor with special interest groups and targeting needed voters.
This challenge is not only one for the governor, but for the people of Michigan who deserve their tax dollars to be spent in a way that will serve all of us long term.
For the last several years, headlines have spoken of “surprise” increases in the number of tax dollars landing in the state treasury’s coffers. The dollars we are talking about are coming out of all of our pockets — and the spending of them by the government needs to be in a way that serves us all, not just a few people in the immediate future, but all of Michigan in the long term.
It wasn’t so long ago that the phrase “Will the last person out of Michigan turn out the lights?” was muttered in the same hallways that are now the home to legislators and the governor arguing in favor of spending large amounts of money.
The governor has the responsibility of presenting a budget that aligns with her priorities, but the Legislature has the responsibility of crafting a budget that determines how our tax dollars will be spent. This system of checks and balances is designed to ensure that our tax dollars are spent responsibly.
But what does responsible spending look like? And how can Michigan’s Legislature ensure that the budget our state operates on will actually serve more than select, targeted voters that Gov. Whitmer and legislators need to please to get re-elected?
This year, the Legislature needs to weigh their own upcoming election chances with Michigan’s future, and our legislators have to make crucial decisions to ensure that we have a long-term plan, and not a short-term win. These unfunded liabilities threaten the future financial stability of the state and local governments. We have a historic opportunity to get ahead of these debt obligations and provide continued stability for future generations.
Especially with the largesse of one-time money they have to spend, large investments should be made in state and local pension funds. The Legislature and governor should make keeping the promises to our seniors and lifting the burden from our kids a key pillar of this process.
In other words, one-time money would be like someone giving you enough money to pay off your mortgage. The irresponsible thing to do would be to go on a spending spree that eventually will lead to more long-term debt. The responsible approach would be to pay off your house, which then would free up money for your daily expenses.
While the debate rages on about treating public employee retirements differently with a tax break, the only responsible move is to pay down the unfunded liability which will honor the commitment made to those very retirees by fully funding their pensions.
Unfortunately, some politicians see tax dollars as a ticket to being re-elected. Creating pet pork projects, directing spending to new programs that serve a specific set of targeted voters serves no one, and creates a long-term path to deficit spending.
As our legislators and the governor work together to determine Michigan’s financial future, we have one ask: spend this money with an eye on the next generation, not the next election.
John Kennedy is board chair of the West Michigan Policy Forum and president and CEO of Autocam Medical.
Michael Jandernoa is policy chair of the West Michigan Policy Forum and managing partner of 42 North Partners LLC.
This op-ed was originally published in Crain’s Detroit Business.