News Bite

Fact-check: No, Gov. Whitmer never faced a $3B deficit

There was a small budget surplus projected when Whitmer was sworn in

Gov. Gretchen Whitmer recently cited an additional 25,000 jobs in the auto sector as evidence of her success and of a growing economy.

But a Michigan Capitol Confidential fact-check showed Whitmer misrepresented that number by failing to account for job losses. The Detroit Free Press found that Whitmer was counting job announcements as jobs.

Whitmer tweeted another misrepresentation on June 22, this time as it related to the state budget. Whitmer wrote from her personal account: “We’re boosting Michigan’s economy — turning a projected $3 billion deficit into a $7 billion surplus. I will work with anyone to keep our economy thriving.”

The governor deserves neither blame nor credit for the economic trends that drove both the anticipated deficit and the surplus that appeared.

Official budget projections made in May 2020 said there would be a sharp decline in collections due to COVID-19 and its related restrictions, but the revenue downturn never happened. General and School Aid Fund revenue was projected to be $22.5 billion in the 2020-21 fiscal year, down from a previous estimate of $25.5 billion. But the state ended up collecting $29.0 billion in those two funds that year.

Administrators ignored an infusion of federal cash that would have closed the phantom deficit more than three times. By spring 2020, Congress had allocated $9.7 billion in extra disbursements for Michigan.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.