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Why spending the surplus on improving Michigan trumps a teensy tax cut (guest column)

January 31, 2014

Lyke Thompson, professor of political science at Wayne State University and director of Wayne State's Center for Urban Studies, and Marjorie Sarbaugh-Thompson, political science professor at Wayne State who teaches public policy, opined about Michigan's projected $1.3-billion budget surplus and a proposal to implement a tax cut. The tax cut proposal, instead of reinvesting it to produce jobs, passed a Senate committee this week. "Even if you turn the entire surplus into an income tax cut, it would be worth less than 50 cents a day to the average Michigander - much less than a cup of coffee or a gallon of gasoline. Only the rich would see a substantial benefit from such a tax cut - more than $8 per day for the average earner in the top 1 percent. And the poor? The average worker in the bottom 20 percent would save a mere 8 cents a day." The writers suggest that it would be "far better for the vast majority of Michiganders for the Legislature to create more jobs by building better roads, improving schools and reducing crime. Not to mention some of the windfall so we can avoid drastic cuts the next time Michigan's highly cyclical economy turns south."