Thanks to GOP Governor Rick Snyder’s commitment to pro-growth tax reform, Michigan has made a stunning economic comeback, leading to massive job creation and the revitalization of the state’s once-lagging business climate. Since Governor Snyder took office and began implementing substantial business and property tax cuts, Michigan’s unemployment rate has plummeted from 10.9% in 2011 to 3.9% today. With Governor Snyder’s common-sense leadership and relentless positive action, Michigan is setting a clear example for how pro-growth tax reform can revive state economies.
The Wall Street Journal editorial board writes:
As Washington begins to debate tax reform in earnest, states can provide instructive policy lessons for better and sometimes worse…
Michigan…offers a case study in the pro-growth potential of business tax reform…
By 2011 when Mr. Snyder assumed office, auto manufacturing had rebounded, but other industries remained limp. Michigan still hadn’t posted annual net job growth since 2005. Its 10.9% unemployment rate was the fourth highest after California, Nevada and Rhode Island.
Mr. Snyder’s first major undertaking with his Republican legislature was to replace the cumbersome state business tax with a 6% corporate tax and trim the individual rate to 4.25%. Michigan’s corporate-tax ranking jumped to seventh from 49th in the Tax Foundation’s business tax climate rankings…
After the 2012 midterm elections, Republicans passed right-to-work legislation that lets workers choose whether to join unions. In 2014 state voters approved a ballot measure backed by the governor to repeal the personal-property tax for small businesses and manufacturers, which was levied on the value of machines and other tangible equipment.
Capital investment and hiring have increased sharply. Two months after Mr. Snyder signed the tax reforms, job growth turned positive. In 2011 Michigan added jobs for the first time in six years, and it has since led the Great Lakes region in manufacturing growth.
Unemployment has fallen below the national average to 3.9% even as the labor-force participation rate has ticked up…
Downtown Detroit is drawing tech firms and young entrepreneurs. Unemployment in the Detroit metro area has fallen to 3.2% from 11.4% six years ago. Businesses in Ann Arbor and Grand Rapids say they can’t find enough workers. Perhaps they should try recruiting in Chicago or New Haven…
While progressives may continue to deny that taxes matter, Michigan’s economic comeback shows otherwise.
