Comprehensive Budget Solution Paves Way for Progress on Michigan's Aggressive Jobs Plan .(MP3- 3MB)

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Last week, the Michigan Legislature agreed to a combination of cuts, reforms, and new revenues that ended a brief government shutdown. This agreement puts Michigan on solid fiscal footing, it prevents massive cuts to health care, education, and public safety, and it will allow us to move forward aggressively with our jobs plan to diversify and transform Michigan’s economy.

Michigan has been challenged like no other state by trade policies that shipped tens of thousands of manufacturing jobs overseas. And Michigan’s fiscal policies in the 90s turned a billion dollar surplus into a huge deficit, leaving our state unprepared for the economic tsunami that it’s faced in this new century.

Given the hand we’ve been dealt, the three-part solution of cuts, reforms, and revenues was an absolute necessity to put Michigan on the road to economic recovery.

The cuts are significant – especially because I’ve already resolved more than $4 billion of budget deficits – more than any governor before me. This year, we will have to cut $440 million more. These will be difficult cuts, but they have to be done.

The Legislature also agreed to reforms that will restructure how our government operates and how employee benefits work. These reforms are similar to the measures taken in the private sector; and combined with the cuts, they will help us control the costs of government over time, saving $1.5 billion taxpayer dollars. While there are more reforms that need to be done, this is clear progress.

Finally, the Legislature agreed to new revenues in the form of restoring the income tax to slightly below what it was during the 90s – temporarily – and extending the sales tax to certain services. Together, these new revenues will cost the typical Michigan family about one dollar per person each week – that’s about the cost of a can of pop.

With this combination of cuts, reforms, and new revenues in place, we can move Michigan forward and get our economy back on track. Already, we’ve heard favorable reviews from Wall Street – analysts and economists know how important it is that we’re not relying on one-time fixes anymore. With our fiscal house in order and with the competitive Michigan Business Tax ready to take effect, we’re poised to move forward with the aggressive economic plan that I set in motion in my first term.

I’ll continue to go anywhere and do anything to bring good jobs to Michigan. We’ll use the 21st Century Jobs Fund to diversify our economy, and we’ll be able to invest in education and maintain Michigan’s high quality of life. With a crisis averted, we’re not going to waste a moment in getting to work on the next steps in Michigan’s economic plan.

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