A news service for the people of Michigan from the Mackinac Center for Public Policy

Michigan governments would save $5.7 billion if the employment benefits of Michigan’s state and local government workers were set at private sector averages.

“Here’s what $5.7 billion can buy:   brand-new 50-inch 3-D plasma screen T.V. for every household in the state.”

State and local governments currently employ roughly 400,000 full-time workers in Michigan. It may be procedurally difficult to attain all of the $5.7 billion in a single year, but a policy that public-sector employees will not be paid more in benefits than private sector averages will eventually result in these savings.

Here’s what $5.7 billion can buy:

A year’s clothing budget for every family in Michigan.

A round of golf for every Michigan resident at both Arcadia Bluffs and Bay Harbor.

A brand-new 50-inch 3-D plasma screen T.V. for every household in the state.

A year’s worth of electrical bills for every household in Michigan.

But as a policy matter for legislators:

Michigan can eliminate the Michigan Business Tax, resolve its budget deficit and still have $2 billion left to spare.

It can eliminate its personal income tax in its entirety.

In a politician’s terms: every man, woman and child in Michigan could max out on their personal contribution to any state representative of their choosing.

Governor-elect Rick Snyder said he will investigate this disparity, provided that consideration will be given to the affected workers.

The original version of this story was posted online on Dec. 9, 2010.

Northern Michigan University economist Hugo Eyzaguirre discusses how raising the minimum wage will hurt emerging local economies. See more at "Raising the Minimum Wage, Lowering Opportunity."


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