GOV. Jennifer Granholm and the leaders of the Michigan Legislature have reached a rare agreement to cut the state's budget by about $300 million. The action sparked immediate, angry, justifiable, and yet completely unrealistic protests from virtually everyone feeling the pain, from laid-off state police troopers to those who run teen pregnancy programs.
What the objectors should realize is that unless state leaders grow up and drastically change the way they do business, these cuts will be just a grim - and minor - taste of the future.
True, the impact of the budget cuts is magnified because they are for the fiscal year ending Sept. 30, a year in which nearly two-thirds of the funds already have been spent. Now for the real shocker. If it weren't for the federal stimulus funds coming from Washington, the picture would be much, much worse.
Three months ago, state officials thought Michigan's budget deficit was around $300 million. Then it swiftly ballooned to a current, staggering $1.3 billion - more, if you count a shortfall in the school aid fund. Much of this is due, obviously, to the near-collapse of the domestic auto industry. But the state's budget system is also dangerously flawed, based on unrealistic assumptions and guaranteed to produce big deficits virtually every year.
Why hasn't this been fixed? Because term-limited lawmakers have been able to juggle the books and use smoke, mirrors, and one-time fixes, knowing they wouldn't be around to be held accountable. Now the days of wine and roses or, perhaps, champagne and Pontiacs, are at an end.
Predictions for the likely budget deficit for the fiscal year starting Oct. 1 start at $2 billion and go up from there. What's worse, from a financial accountability standpoint, next year is an election year and neither party is going to want to make the other look good.
What Michigan lawmakers need to do - now - is lock themselves in the Capitol and go to work reinventing a budget process that is dangerously flawed. Both parties should be prepared to give a lot, in the name of their state's future, and fiscal sanity. Democrats should agree to repeal the silly surcharge they irresponsibly slapped on the new Michigan business tax two years ago.
In return, Republicans should accept a slightly higher state income tax rate now, and agree to put a constitutional amendment calling for a graduated income tax on the ballot later, in November, 2010.
Failure to make major changes immediately could lead to a fiscal catastrophe within two years that could leave Michigan's economy looking like a colder version of Haiti's.
Long ago, one of the characters in Doonesbury remarked, "The world needs grownups." Lansing surely needs them now, more than ever.
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