In Michigan, Vote “D” For Depression On November 7
Today, the once great state of Michigan has the absolute worse economy in the nation. They entered a recession several years ago and have never came out of it:
7.1% Unemployment rate (U.S. average is 4.6 percent)
13% Number of people living below poverty level
73,000 Manufacturing jobs lost from 2003 to 2005
35,000 Home foreclosures, up 137% in first eight months of 2006
As someone who thoroughly understands the automotive industry and has remaining business ties to Michigan, I unfortunately believe that it will only get worse unless there is “change” now. Debbie Stabenow has had six years to help change the state while Jennifer Granholm has had four. At this point the only change that can be made is a change in political leadership.
Today, November 1, marks the five-year anniversary of the end of the last recession and the beginning of the latest U.S. economic expansion. With average economic expansions only lasting 57 months the question is where the nation is going and more importantly, where is the state going:
But whether the USA will have another five years of economic growth without sliding into recession — at least matching the record 10-year expansion that ended in 2001 — is an issue that sharply divides economists.
In a USA TODAY survey of economists conducted Oct. 13-18, 24 said the economy will continue to expand for at least another five years. But another 24 said the expansion will likely be truncated by a recession sometime before November 2011.
“Not a chance,” says Tucker Hart Adams, owner of the Adams Group, an economic consulting firm in Colorado Springs, about the chances of the expansion hitting the 10-year mark. “Consumers can’t continue to spend for another five years. They have too much debt.”
The first, second, third and only priority of every Michigander should be Jobs, Jobs, and Jobs but sadly it isn’t:
Those who say health care is the most important problem facing the state ballooned from 11 percent of poll respondents last week to 20 percent this week
Unless Michigan can change it’s direction now, when the Nation goes from healthy expansion to recession, Michigan will go from recession to depression. Michigan is not going to recover from recession when the Nation contracts. Property values are already collapsing in Michigan, without the prior benefit of skyrocketing growth!!!
A decade ago when I expanded my business operations outside of Michigan I soon began to realize that Michigan had very little to offer when compared to other States. The business climate was not very good, the tax situation was poor, there was a “union working mentality” and the weather is only good a few months out of the year. While Michigan may appear to be a great place from inside the fish bowl, it is not very desirable to locate into.
You may rightly say, “Hey, it is easy to criticize what is your solution?” I have no single solution but I do know what will drive business away, and I have that “inside experience” as a business man who is being driven away.
In this election we have the top spots on the ticket, held by Democrats, who as part of their campaign are attacking businesses that have been very good to the people of Michigan. While Governor Granholm has been attacking Michigan based Amway which supports thousands of Michigan families, Senator Stabenow has been attacking Jackson National Life Insurance Company, a very large nationwide insurer still based in Michigan, along with Pfizer that assumed the old Warmer Lambert facilities in Ann Arbor. Michael Bouchard, Republican candidate for Senate rightly wonders, “STABENOW: WHOSE SIDE IS SHE ON?”
In 2003, the Detroit News noted that Stabenow had tried to “severely undermine” Pfizer, despite the fact the company provides high-paying jobs for tens of thousands of Michiganders.
Senator Stabenow falsely attacked the Lansing-based company Jackson National Life for outsourcing, when in fact Jackson National is expanding and adding jobs in Michigan. A spokesman for the company was quoted as saying that Stabenow’s false attacks “don’t really make us feel welcome in Michigan.”
As a businessman, I wonder if it is now time for myself to simply join the many others and finally shut down my Michigan operations? For those left behind, their only question must be “What business will relocate to Michigan when existing business’s are no longer “welcome?”"
As an actuary, a political junkie, and someone with deep Michigan ties, I know on paper the ground plan for Bouchard to win the Senate race. Conditions in Michigan are “ripe” for change, but the “$50,000 question” is if there are still enough conservative/libertarian minded “boot strap” voters left in Michigan to bring about change. Absent hard evidence, Club for Growth has the best illustration of the movement out of Michigan:
So can you guess in which direction taxpayers are moving between these two states? Here are the U-Haul rates for a 26-ft truck on October 29, 2006 (an arbitrary date):
Detroit to Nashville: $1659.00
Nashville to Detroit: $295.00
Unless there is political change in Michigan, there will not be enough time for the People of Michigan to dodge the state depression bullet. I can easily imagine Jennifer Granholm trying to tax Michigan out of it’s depression in 2007. If republicans were on the top of the ticket, I would be saying the same thing. Sadly, national Democrats are only concerned with one more “D” in the Senate and do not give a damn what happens with business growth in Michigan.
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January 23rd, 2010 at 11:04 am
Seems like everyone from Michigan is moving to Cool Springs. I have gotten calls form several different businesses interested in relocating to Williamson County.