In the first polls since the August primary, GOP candidate Rick Snyder leads Democrat Virg Bernero in the race for the Michigan Governor's seat. Jack McHugh, the senior legislative analyst at the Mackinac Center For Public Policy, tries to analyze the possible policy directions that each candidate would take Michigan in:
On public policy, I suspect that Rick Snyder isn't sure himself what exactly he will do. Presumably he'll be more engaged than the current governor (it would be hard to be less), and as a pragmatist will face certain realities that are consuming a state that's in an economic freefall and in danger of spinning into a demographic death spiral:
- Public employees receive fringe benefits (including health and pension) whose value exceeds private sector fringe benefit averages by $5.7 billon annually; the political class here shows no ability to escape their bipartisan servitude to the public employee unions and fix this (evidenced by the gutting of Gov. Granholm's extremely modest school pension reform of this year). More broadly, in category after category Michigan pays more than other states for common government services like schools, prisons, etc.
- The state has become a regulatory hellhole, with apparently no adult supervision at the Department of Natural Resources and Environment (formerly DEQ); MIOSHA on the brink of cranking out destructive ergonomics regulations; illegal new home insulation standards being enforced; a bureaucratic guerilla war against the insurance industry is underway; and many more examples.
- We replaced a complex and burdensome Single Business Tax with a complex and even more burdensome Michigan Business Tax and surcharge.
Snyder appears enamored with the growing corporate welfare empire that has been and always will be so impotent at improving Michigan's economic fortunes. There's a great danger that, like Granholm, he goes chasing down that rat-hole as a substitute for a real economic growth agenda.
Here's the good, the bad and the ugly on Virg from someone who lives in the town where he's been mayor:
- The good: As mayor he's been a decent "spending hawk," taking on the big-spenders on city council on things like closing money-losing city golf courses. Also, he hasn't been a complete pushover for the public employee unions.
- The bad: He won this primary by kowtowing to the most economically destructive components of Michigan's polity, the public employee (and industrial) unions, plus environmental extremists.
- The ugly: Late in his state Senate tenure Bernero played the role of an unprincipled "Not In My Back Yard" (NIMBY) populist on the issue of a new gasoline pipeline. He did everything possible to block a company that wanted to upgrade and expand to Lansing an old pipeline that had suffered an earlier leak, even though the alternative was hundreds of gasoline trucks driving through the city.
Bernero introduced a bill that would have essentially halted any new pipelines in Michigan, and worked hard to block legislation that cleared regulatory uncertainty regarding the issue. By no stretch could this be portrayed as pursuing good public policy for the state - it was cheap NIMBY politics of a very destructive kind. To aggravate the offense, when he became mayor Bernero wasted hundreds of thousands of taxpayer dollars in a pointless, unwinnable lawsuit against the pipeline, again pursuing politics over good public policy.
Whoever is elected, his success as governor will depend on how far he's willing to go in defying politically powerful unions, anti-growth environmentalists, corporate welfare "rent seekers" and the politicians in both parties who pander to all three special interests.
The basic recipe for a successful Michigan government and economy is simple: In every area of government - spending, taxes, regulation, labor law, etc. - make this state a place that all investors and entrepreneurs large and small, home-grown and foreign, look to and realize, "Hey, we can make money there - and the government won't drive us nuts if we try."
If our next governor accomplishes that, Michigan's economy will start to grow much more quickly than anyone can imagine.