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Jase Bolger: Act on Michigan's budget now

It has been nearly 60 days since my House Republican colleagues and I introduced a plan to balance the budget, invest in Michigan's infrastructure and boost job creation, all without raising taxes. And still, with just weeks before the budget deadline of the end of this month, there is no budget. Only days after she told reporters she is "not in favor of new taxes" and that "we don't need a tax increase," Gov. Granholm proposed a budget which raises taxes nearly $1 billion. With House Democrats not having any kind of budget plan on the table, Michigan is approaching the second government shutdown in the state's 72-year history.
State Budget- An Overview PDF Print E-mail
Written by Patrick Heffner   
Wednesday, 18 March 2009 22:55

In lieu of the upcoming state budget battle, it is important that individuals looking to stay on top of the back and forth on the issue have a general knowledge of the budget's composition. Both political parties have particular projects they attack as wasteful and excessive in the state budget, and it is important to have a general picture of the budget in order to see what is used where. Additionally, different states have different budget numbers that make each state budget unique, and thusly by comparing Michigan with other states, we can learn what Michigan spends more, or less, of its money on comparatively.

We'll examine the Michigan FY 2007 budget. Here is a pie chart showing Michigan's general budget spending in FY2007:

As you can see, the state's funding priorities have shifted considerably in just six short years. The top four programs for general fund-general purpose spending are, in order:
- Community Health- 32.4%
- Higher Education- 20.2%
- Corrections- 19.7%
- Human Services- 12.9%

How does the state generate its revenue?

Many will be surprised to find that the general fund only accounts for 23% of the state's portion of its budget. Much of the federal spending is Michigan run, federal mandates consisting of block grants or other tools of devolution. In short, although Michigan's budget is 42.8 billion dollars, much of it is not up for debate during the widely reported yearly budget discussions.

That is a general overview of the budget itself. In the coming days however, we'll dig deeper into each major section of the general fund, comparing Michigan's expeditures with two states: Nebraska and California. Nebraska is one of the few states to continue a budget surplus this fiscal year (link to my own article), and hopefully a comparison to that state will give some ideas to Michigan policymakers for future budget adjustments. Conversely, California has an astounding budget deficit, and recently ended a protracted budget struggle eerily similar to Michigan's 2007 adventure. By examining California's budget, we can see where bigger states might have even bigger problem's than Michigan's seemingly endless shortages.


 

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Evan Martinak is state budget policy fellow for the Michigan Policy Network. Evan is from Walled Lake, Michigan on the east side. He is a student in James Madison College, pursuing a major in international relations and also doubling it with an economics major. He intends to pursue a minor in Philosophy of Law. He is highly involved in student government at MSU. He is a member of ASMSU (The Associated Student of Michigan State University) as well as James Madison College Student Senate. He is also an avid Manchester United fan.
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