Karen Holcomb-Merrill

New rankings about state “business tax climates” by The Tax Foundation have been touted here in Michigan recently. The official rankings will be released this summer, but projections are that Michigan will move from 18th to 12th. Sounds like something to celebrate, right? Not so fast.

The primary reason Michigan is moving up in the rankings? Tax proposals passed last year that slash business taxes 83 percent, while increasing taxes on individuals by 23 percent. As noted in the League’s recent report, 51 percent of individuals will pay more in taxes after fiscal year 2012. Low-income people will be hit the hardest.

While The Tax Foundation may laud the business tax cuts in Michigan, there is no evidence at all that they will create more jobs or stimulate economic activity — two things we need here in the Mitten state.

What we do know, however, is that because of the tax cuts to businesses, there is less money in the state budget for things that businesses and their employees value. Those are things like strong schools, good roads, public safety and a skilled workforce.

Overall, The Tax Foundation seems to reward states that have low business taxes and, in turn,  a disinvestment in important public structures that actually benefit businesses and a growing economy.

I think this is one “reward” that Michigan can do without.

Who’s No. 1 on the list, you ask? The state that is held up as the example of a great business climate? The state of Wyoming. A state with no Fortune 500 companies.

– Karen Holcomb-Merrill

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Categories: Blog: Factually Speaking, Health Care, Human Services, Tax Policy | Tags: budget, education, revenue, tax

Jan Hudson

It’s Valentine’s Day –a day to focus on those closest to us. The Affordable Care Act will make sure health care is available to those we love.

Learning more about the ACA at Health Action 2012 was a great experience but also very sobering. We are at the crossroad for health care reform and the future of the Affordable Care Act.

The question is:

• Will we cover nearly all Americans, control costs, improve quality of care and outcomes, and require insurers to spend most of  the premiums on health care rather than administration or profits; or
• Will we return to ever-increasing premiums, numbers of uninsured, costs, and profits for insurers, as well as denials for pre-existing health conditions, annual and lifetime benefit limits? 

This critical question will be partially answered when the Supreme Court rules on the constitutionality of requiring nearly everyone to purchase insurance or pay a penalty, and of expanding Medicaid to families and individuals up to 133 percent of the poverty level ($29,327 for a family of four). 

The remainder of the question will be answered by the outcome of the November election. Those who don’t support the law are calling for its repeal.

At the conference, we were reminded how important it is for each one of us to understand the law and its benefits. It provides control and security through new consumer protections. It holds private insurers accountable for meeting the needs of and providing quality, competitive products to those who purchase their coverage. It creates a competitive marketplace where individuals and small businesses can compare products on an apples-to-apples basis, purchase coverage, and where individuals can obtain subsidies for premiums and cost sharing.

In addition, insurers must:

• Provide “essential benefits,”
• Cover young adults up to age 26 on their parents’ employer-sponsored plans,
• Not charge extra to those with health conditions such as diabetes or asthma,
• Not cancel coverage when someone becomes ill and needs it most,
• Not set limits on the amount of benefits they will pay in a year or someone’s lifetime,
• Not deny coverage to someone with a health condition, such as diabetes or cancer, to name just a few.
 
In addition to the Medicaid expansion, the ACA also provides premium and cost-sharing subsidies to help those with incomes up to 400 percent Federal Poverty Level ($88,000 for a family of four) afford coverage.

Cost control is a key topic and a focus at Health Action 2012. It will not, however, be accomplished by cutting essential benefits, or reducing the number of people who have coverage. Rather we must provide services with value in a more efficient manner. Dr. Stuart Altman counseled against putting  access to care in peril in the name of cost containment.

Dr. Atul Gawande also focused on the need to provide better quality services in a more efficient manner. He described systems of care as a solution, focusing on the quality of care provided, the outcomes achieved, and not the number of services provided.

Health care also impacts other essential services. Gawande said that while attending a parent-teacher conference at his son’s school, he questioned his son’s class size, concerned that he was not receiving enough individual attention. The principal explained that the high health care costs of school employees (including a former patient of Dr. Gawande) reduced classroom resources resulting in higher class sizes — even in this very affluent school. Dr. Gawande concluded health care costs directly impact his son’s education.

Pollster Celinda Lake noted from recent polling that women, who make 80 percent of family health care decisions, are not knowledgeable about the ACA. 

It’s essential for women to take the time to become familiar with this critical law and these benefits and protections for themselves, their children and their parents. Michigan Consumers for Healthcare  provides up-to-date information on the law and its implementation from both the state and national perspectives. 

The ACA, if fully and well implemented, will impact every American by providing more control and health security. Isn’t that a Valentine’s Day goal worth pursuing?

– Jan Hudson

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Categories: Blog: Factually Speaking, Health Care | Tags: Affordable Care Act, children and families, Health Care, health insurance, vulnerable families

Gilda Z. Jacobs

From the League’s First Tuesday newsletter
Sign up for the newsletter here

Last month, I shared with you the League’s proud history of 100 years of research and advocacy on behalf of economically vulnerable children and families in our great state.

As the Legislature and governor prepare to tackle the challenges that still face our state, I want to give you a snapshot of the League’s latest reports which help to highlight the pressing priorities.
Kids Count, by far, had the most stunning news.

Despite an improving economy, child abuse and neglect in Michigan jumped 34 percent over the past 10 years. Nearly half of all public school kids statewide now qualify for free or reduced price lunches. 

The percent of kids living in poverty increased from 14 percent to 23 percent. In anybody’s book, these figures are unacceptable.

In addition, investing in children to reduce incarceration rates in the future is the theme of the League’s most current paper.

Michigan is one of only two states that spend more on corrections than higher education. This figure, too, is unacceptable. Studies prove that access to a quality education is the most important preventive measure against crime and imprisonment (and a much cheaper investment).

Finally, the League’s recently released tax paper points out that the new tax structure in Michigan hits the lowest-income folks 1,000 times harder than wealthier folks in the state. Again, another unacceptable statistic.

But the Legislature and administration can do something about these startling figures. Investing in public infrastructures and human capital works and will help provide a more secure future for our state, our families, and our children.
Let your voices be heard in Lansing.

– Gilda Z. Jacobs

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Categories: Blog: Factually Speaking, Events, Human Services, Kids Count, State Budget, Tax Policy | Tags: budget, children, education, First Tuesday, Gilda Jacobs, Kids Count, poverty, revenue, vulnerable families

Anika Fassia

What do you visualize when you hear ‘a safe community’?

Let me guess: You see good schools, nice houses, parks, friendly neighbors, and healthy and happy kids running around? Or wait. Is it one where we place more of our community members in prison far away from their families and have more public employees working in prisons rather than schools? If it’s indeed the latter, you’re in luck, because that’s what our state is proposing to make our communities ‘safer.’

We’ve heard a variety of suggestions as to how to decrease rising costs in the Corrections budget—everything from increasing correction officers’ shifts from eight to 12 hour days, to shipping prisoners up North, to getting tougher on crime by increasing sentences. None of these suggestions get to the root of the issue at hand. Safer communities are ones where everyone has access to good schools, affordable housing, living wage jobs and quality health care.

Governor Snyder recently stated in his second State of the State address that reducing crime and increasing public safety was one of his top priorities, seeing as Michigan is home to four out of 10 of the most violent cities in the country.

According to renowned authors on public safety Michelle Alexander and William Julius Wilson, the primary reason behind increased violence is lack of opportunity in communities, more specifically, limited access to education and living wage jobs. Yet, the Legislature continues to slash funding for higher education, community colleges and employment and training services and propose initiatives that would instead increase the Corrections budget and not make our communities any safer.

To add insult to injury, Attorney General Bill Schuette recently proposed a new sentencing initiative entitled VO-4. Under the VO-4 proposal, when repeat offenders are convicted for the fourth time, they would automatically receive a sentence of at least 25 years in prison. The Michigan Department of Corrections came up with a preliminary estimate of what it would cost the state to implement VO-4 to all four-time offenders currently in the corrections system. The Department estimated that they would need to add 17,800 beds over the next 25 years. If the proposal is implemented, the first year would require an additional 300 beds and would cost around $10 million with these costs rising each following year.

The overarching goal of the Corrections Budget should be to provide for safer communities by decreasing corrections spending and the number of state prisoners, not the other way around. Unfortunately, current and proposed budget proposals represent a short-sighted and costly approach to accomplishing this goal. As noted in our latest paper, failing to provide high quality education to all of its residents and investing too little in services that provide economic stability for families has forced Michigan to spend too much of its limited resources on incarceration. Our state can do better and there are ways that would not risk public safety and would free up resources for higher priorities.

For example, what does it say about the state’s priorities when for every $1 Michigan spends on higher education, the state spends $1.19 on corrections? Only one other state, Vermont, spends more on corrections than higher education. It costs the state an average of $28,308 annually to house a prisoner in Michigan, on top of nearly $7,000 a year for health care and mental health care, for an average total of $35,308. In Michigan, tuition costs an individual an average of $9,732 per year to attend a four-year university, or a total of $38,928.

Access to a quality education has been cited as the No. 1 preventive measure against crime and incarceration. A study in Ypsilanti found that quality education saves $16 for every dollar invested. Shifting state resources toward investing in education opportunities for youth could significantly decrease their chances of ever being incarcerated.

We all know what safe communities look and feel like—ones where we invest in our children and families and all enjoy the qualities of life. It is time the state realizes the long-term benefits of investing in communities from the start, valuing security and economic mobility for children and families by providing pathways to success— not prison.

– Anika Fassia

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Categories: Blog: Factually Speaking, Human Services, State Budget, Workforce Development | Tags: budget, corrections, education, tax, vulnerable families

Joanne Bump

As you file this year’s tax return, you may not be fully aware of the new tax increase that awaits us in 2013. Michigan businesses will pay 83 percent less in state income taxes in fiscal year 2013. The $1.6 billion reduction in business taxes will mostly be made up by a tax increase on families.

With these tax changes 51 percent of individuals filing a state personal income tax form will pay more taxes. The average tax increase will vary depending on income, with the lowest-income group paying $101 more and the highest- income earners paying just $7 on average, according to the Institute on Taxation and Economic Policy.

And, you might ask, what do we gain? This higher tax burden isn’t likely to create the new jobs that were talked about. The lowest-income families were hit hardest by the average tax increase as a percent of their income. (See the report, Tax Changes Hit Low-Income Families the Hardest.)

This was a lost opportunity as Michigan’s tax structure was already regressive. Under the old law, even with the state Earned Income Tax Credit and the Homestead Property Tax Credit, low- income families paid a higher percentage of their income in total state and local taxes. Families with income under $15,000 paid 9.1 percent compared to families in the top 1 percent of income paying 5.6 percent. Unfortunately, the new law just made it worse. 

Individuals also lost with significant cuts to services. These reductions wouldn’t have been needed if not for the business tax cut. The $1.5 billion in budget cuts in fiscal year 2012 was unprecedented. Cuts were made to the EITC, the clothing allowance for many low-income kids was eliminated, and cash assistance was ended for over 29,000 kids. Local economies will feel the pinch as low-income families tend to spend their income immediately on necessities.

Although children are not to blame for their plight, recent tax policy changes pushed more kids in poverty. Meanwhile, two-thirds of the state businesses will not pay a state business income tax. Business taxes are needed to fund the public structures that they utilize.

On the heels of these steep business tax cuts are proposals to further cut taxes paid by businesses. Additional cuts to business taxes are likely to reduce revenues available for important services and could lead to increased taxes on individuals. Future tax changes must provide for adequate funding for such services as health care, public safety and help for abused children.  We must support our vital public structures and provide support for vulnerable families in our state.

– Joanne Bump

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Categories: Blog: Factually Speaking, Human Services, State Budget, Tax Policy | Tags: budget, cash assistance, children, children and families, data, Department of Human Services, earned income tax credit, eitc, Health Care, income tax, medicaid, poverty, revenue, safety net, tax, vulnerable families

Jane Zehnder-Merrell

The last several state Kids Count data books have tracked the increase in child poverty, but the latest highlights the fact that between 2000 and 2010 the percentage of children in extreme poverty doubled—from 5 percent to 11 percent. These children live in families with income under half the poverty level—less than about $900 a month for a family of four with two children.

Given our understanding of the consequences of deep and prolonged poverty, we should be exerting every effort to address it. International and national health experts have repeatedly emphasized the importance of socioeconomic well-being in fostering or compromising health—physical, mental and emotional.

Economic factors play a critical role in the conditions in which children live and grow. Yet for the current fiscal year the legislators and the governor actually cut programs, such as the Earned Income Tax Credit, that lift families above poverty, and restricted access to cash and food assistance. Even with the revenue surplus now available there is no discussion of using the surplus to support families.

Despite worsening economic conditions teen birth and death rates in the state declined between 2000 and 2009. The high school dropout rate decreased substantially—dropping from 15 percent for the Class of 2007 to 11 percent for the Class of 2010. These trends speak to the efforts of families, communities and schools in helping more young people negotiate adolescence successfully.

At the same time confirmed child abuse and neglect rose by 34 percent—affecting roughly 32,500 children in 2010. Over 80 percent of these cases involved neglect—often precipitated by poverty.

The data book is an essential tool in helping us understand the status of the children in our state and local communities so we can have a productive conversation about the appropriate local and state policy responses. Data for Michigan counties and cities are also available on Kids Count Data Center. 

Decisions about programs and policies are better when they are grounded in data reflecting the realities of children’s lives.

– Jane Zehnder-Merrell

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Categories: Blog: Factually Speaking, Events, Health Care, Human Services, Kids Count, State Budget | Tags: cash assistance, child welfare, children and families, earned income tax credit, Kids Count, revenue, vulnerable families

Judy Putnam

Gov. Rick Snyder’s State of the State address included some welcome items but what he didn’t speak about was telling.
 
The governor mentioned the need for a safety net for those most in need. He supported immigration, pointing out that major Michigan companies — Dow, Masco and Meijer — were started by immigrants. He talked about the need for a Michigan health care exchange, which will move federal health care reform forward in our state.
 
He also talked about the success in placing foster children into adopted homes and introduced a family from Canton who adopted two kids. It was touching to hear the governor call them a “forever family.”
 
But what he didn’t talk about was the thousands of other children in our state who struggle with basic needs – shelter, food and clothing.  He didn’t speak of the growing poverty engulfing our kids.
 
The first year of the Snyder administration brought many cuts to the public structures that help low-income children and their families. Specifically, the state Earned Income Tax Credit, which goes to lower-income working families, was cut by 70 percent – effectively raising taxes on those least able to afford it.
 
In addition, 11,000 families were cut from cash assistance with little warning.  The administration also instituted an asset test on food assistance – even though 37 other states have no asset test. Because food assistance is  federally funded, it saves no state dollars in Michigan. Even an annual back-to-school clothing allowance for the state’s poorest children was ended for most children who used to receive this esteem-boosting allowance.
 
Kids in foster care rightly deserve our attention. But we can’t forget about the other kids.
 
And the governor spoke of making Michigan a better place for business. Let’s not forget the other part of that equation – our people.

– Judy Putnam

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Categories: Blog: Factually Speaking, Events, Human Services | Tags: Affordable Care Act, cash assistance, children, children and families, Department of Human Services, earned income tax credit, food assistance, Health Care, safety net, vulnerable families

Renell Weathers

I began this holiday weekend participating in a Dr. Martin Luther King, Jr. diversity breakfast.

I thought about all the events being held celebrating his legacy and extolling the tremendous contributions Dr. King has made to the world in which we currently live.

These reflections will be quite appropriate but will fall short if the audiences aren’t challenged to reflect on how society is responding to his call for equality in this moment of economic struggle.

And by society, I mean each of us. We are the society — each person, community, village, township, city, and state has a role to play.

As Dr. King once asked, “On some positions, Cowardice asks the question, ‘Is it safe?’ Expediency asks the question, ‘Is it politic?’ And Vanity comes along and asks the question, ‘Is it popular?’ But Conscience asks the question, ‘Is it right?’

And there comes a time when one must take a position that is neither safe, nor politic, nor popular, but he must do it because Conscience tells him it is right.”

Will we have the courage to be right?

– Renell Weathers

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Categories: Blog: Factually Speaking | Tags: Martin Luther King Jr.

Peter Ruark

One part of the New York Times online edition that I like to read is “On This Day,” which features a scanned copy of the front page from a prior year on the current day’s date and a reprint of the top articles of that day.

This week has been interesting and instructive. On Jan. 4, 1965, the front page reported President Lyndon B. Johnson outlining the goals of his ”Great Society” in his State of the Union address.

 He proposed a number of programs from which America still benefits today, such as Medicare, the Department of Housing and Urban Development, the National Endowment for the Arts, Pell Grants, Head Start and Community Action Programs.

The article also mentions issues and ideas that we still grapple with today: government funding for high-speed rail, banning states from adopting right-to-work laws, and reducing the cost of farm programs to direct more assistance “to the small farmer who needs help most.” Interestingly, for you trivia buffs, the article also reports that the “Great Society” speech was the first State of the Union speech in which the president used a teleprompter!

On Jan. 5, 1914, the front page reported that Henry Ford introduced a minimum wage scale of $5 per day to employees of the Ford Motor Company (the highest manufacturing wages in the land) as well as an eight-hour standard work day. He also announced that the company would share its record-breaking profits with its employees through semi-monthly bonuses added to the workers’ paychecks. The company treasurer, James Couzens, was quoted as saying, “It is our belief that social justice begins at home. We want those who have helped us to produce this great institution and are helping to maintain it to share our prosperity…Believing as we do, that a division of our earnings between capital and labor is unequal, we have sought a plan of relief suitable for our business.”

Wow! Henry Ford certainly was not Eugene Debs, and this move was done in part to discourage Ford workers from unionizing, but how many large employers today try to avert unionization by paying wages that match or exceed union wages? Acknowledging the workers’ role in creating the wealth and sharing record-high profits by establishing record-high wages sounds progressive by today’s standards.

Thursday’s front page  tells a different story than the others. In contrast to employers that see themselves as agents of economic justice and a Congress and president who together work to create, maintain and improve public programs to fight poverty and preserve the common good, we now read that America has less economic mobility than most other developed nations (Jason DeParle, “Harder for Americans to Rise From Lower Rungs.”) Despite our history as a land of opportunity, Americans born in the bottom fifth income level are much more likely to stay there than their peers in Europe, and those born in the middle rung are more likely to fall down than rise up.

Even so, Congress and the Michigan Legislature have in recent years dismantled, underfunded or weakened programs and tax credits that help low-income workers support their families, and the income gap between management and labor at many of the most successful companies is at a record high.

Times have changed.

– Peter Ruark

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Categories: Blog: Factually Speaking, Events, Human Services | Tags: children and families, data, poverty, safety net, vulnerable families

Gilda Z. Jacobs

Happy New Year! This is an exciting time for the League as we celebrate our 100th anniversary this year. The League began in 1912 as an organization of citizens concerned about the social issues of the day.

Over the years, we’ve been the Michigan Conference of Charities and Corrections, the Michigan Conference of Social Work, the Michigan Welfare League and the Michigan League for Human Services.

More change is in the works. We’ll be unveiling a new look, logo and a new name later this year.

Though we will be changing, we will honor the roots and history of our organization. And, while our mission remains unchanged over the century, our advocacy work is taking on a new sense of urgency.

Throughout the year, we’ll be looking back to events that shaped Michigan and the League, starting with the 1910s era.

Also, mark your calendars: We’re planning a centennial bash Oct. 10.

In the meantime, there’s much work to be done in 2012 to make Michigan a place of economic opportunity for all. Stay tuned!

– Gilda Z. Jacobs

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Categories: Blog: Factually Speaking, Events | Tags: 100th anniversary