June 17, 2010; Source: Observer & Eccentric | Nonprofits need to step into the public dialogue about taxes and their state budgets without delay! State budget crises are campaign fodder. In the gubernatorial debates in Massachusetts and Arizona, the candidates are engaging in the traditional show of arguing about how deeply the governors and legislatures have mishandled their state budgets. Next up is Michigan, which has a number of Republican candidates, according to the Observer & Eccentric, “fall(ing) all over themselves to show how they are most against spending and taxes.” But the editorial writer cautions the candidates and the voters to look for the facts about Michigan’s state budget crisis and learn from the crises of other states as well. Among the points in the editorial is the decline in Michigan per capita income from 18th in the nation 2000 to 37th in 2008, which has Michigan becoming a “poor state.”
But its growth in state spending was due to Medicaid and other federal programs, not because of uncontrolled state spending. The problem, according to the editorial, is not a spending crisis, but a revenue crisis, due to both lower taxpaying capacity in the state and the Headlee amendment from 1978 which caps taxation rates. According to the paper, “state revenue is now at (a) historic low and tax burdens have fallen significantly.”
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The role of nonprofits in these budget debates is to make sure these kinds of facts get to the public, so that tax cut and spending cut demagoguery doesn’t dominate political discourse and gubernatorial campaigns.—Rick Cohen