Michigan Votes Forum

Introduced in the Senate on June 16, 2009

The vote was 25 in favor, 10 opposed and 2 not voting

(Senate Roll Call 248 at Senate Journal 0)

Click here to view bill details.

 

Senators Switalski, Cherry, Pappageorge and Bishop asked and were granted unanimous consent to make statements and moved that the statements be printed in the Journal.

The motion prevailed.

Senator Switalski’s statement is as follows:

I rise in support of the resolution. I think when somebody gives me money, I say, great, thank you very much. Can I spend it on whatever I want? The answer I want is, yeah, go ahead, spend it on whatever you want. I’m glad that the Majority Leader has come to the same conclusion. When somebody gives you money, you would like to spend it on what you really need to spend it on. I’m not sure that has always been the position, but now that we agree, that’s good, let’s go forward with this resolution. I remember giving my son some money for his first communion and I said, “Liam, you can put this money toward your college education. This will be great.” He said, “Well, no, I want to spend it on a new PlayStation. Play video games.”

I understand the feds are giving us money for a certain purpose, and we have other purposes that we would like to devote it to. I hope ours are much more responsible than a PlayStation, and I believe they are, but the principle involved is that the feds are giving us some stimulus money. They want to stimulate the economy. They want us to spend it to get our economy moving again. I think we should share in those goals. I think there is probably a set of principles we could agree on with the feds when we request strings be removed; that we be given a chance for a waiver in terms of some of these things where we might be spending money on things that aren’t really that helpful to us in comparison to other things that we could spend it on.

For instance, if we were going to pay off debts with our stimulus money, well, that doesn’t really put anybody to work. It doesn’t get our economy moving. I would think that if we requested a waiver from the feds to let us pay down our debt that would really not be in keeping with the spirit of the idea of stimulus because it is not stimulative. Whereas, if we are spending money on energy efficiency to reduce our fixed costs long into the future to develop new renewable energy industries in the state that will put people back to work, that is the kind of waiver that I think the feds would be willing to grant.

I have just seen the resolution. I have skimmed it, and the basic idea is being able to spend on what we would like and what we need to spend on rather than what we are told to spend on. Everyone would always agree on that. Your kid would agree on that when you give him his birthday money. We, the legislature, would agree on that when we get money from the feds. The schools—when we give them money—they always tell us, yes, please put that in the foundation where we can spend it wherever we want and need to. Don’t put it into certain categoricals that we might not be able to afford.

I think that is a very wise approach to give us latitude. I think the waiver idea—and I am not sure it is incorporated into the resolution—would be an improvement to where you can ask the feds for a waiver. They should be quite liberal in granting those waivers as long as the spending is in keeping with the idea of stimulus, of creating jobs, of creating new industries, and of creating efficiencies in government.

In conclusion, I would like to reiterate all the points that I have made until my time expires: stimulus, good; jobs, good; new industries, good; proper way to achieve that through a waiver from the federal government that allows us to spend in agreement with our priorities here in the state I think we have full agreement with the Majority Leader on those principles. It should be

 

Senator Cherry’s statement is as follows:

While I appreciate the comments of my colleagues, and I do understand the desire to have waivers for various requirements of the stimulus funding, I rise in opposition to this resolution. It seems to me that the stimulus money was not given as free money. It was given with a specific purpose in mind. When Congress allocates dollars, just as when we allocate dollars, they set their priorities within those dollars. The stimulus money has been provided with those kinds of strings attached.

If the resolution was saying, well, we think in this time of crisis Michigan should not have to have matching funds for road dollars, I would be in full agreement of something like that. I am not in agreement, however, when in this resolution it cites things that I believe are very important in a time of economic crisis; like the prohibition to making cuts on Medicaid; like the prohibition on higher education funding; like the prohibition on community college funding; and the prohibition to use stimulus dollars for debt service. Those, to me, are very appropriate prohibitions, and we should not be wanting to change those prohibitions.

We should be using those dollars, as was said previously, to stimulate the economy and as the bill was passed out of Congress to protect certain basic public safety and welfare nets from collapsing. That’s what those dollars should be used for. That is what they are being used for in our budget. I oppose changing federal requirements that would allow us to spend it on things like debt requirements.

Mr. President, I am opposed to this resolution, and I hope that members will also stand opposed to it.

 

Senator Cherry’s statement is as follows:

While I appreciate the comments of my colleagues, and I do understand the desire to have waivers for various requirements of the stimulus funding, I rise in opposition to this resolution. It seems to me that the stimulus money was not given as free money. It was given with a specific purpose in mind. When Congress allocates dollars, just as when we allocate dollars, they set their priorities within those dollars. The stimulus money has been provided with those kinds of strings attached.

If the resolution was saying, well, we think in this time of crisis Michigan should not have to have matching funds for road dollars, I would be in full agreement of something like that. I am not in agreement, however, when in this resolution it cites things that I believe are very important in a time of economic crisis; like the prohibition to making cuts on Medicaid; like the prohibition on higher education funding; like the prohibition on community college funding; and the prohibition to use stimulus dollars for debt service. Those, to me, are very appropriate prohibitions, and we should not be wanting to change those prohibitions.

We should be using those dollars, as was said previously, to stimulate the economy and as the bill was passed out of Congress to protect certain basic public safety and welfare nets from collapsing. That’s what those dollars should be used for. That is what they are being used for in our budget. I oppose changing federal requirements that would allow us to spend it on things like debt requirements.

Mr. President, I am opposed to this resolution, and I hope that members will also stand opposed to it.

 

Senator Pappageorge’s statement is as follows:

Let me just give you two examples as to why flexibility at our level will improve things. First, with regard to strings from the feds, we need to upgrade our unemployment insurance IT process. We have $24 million standing by right now to do that. The feds have sent us another $84 million for a total of $108 million, yet the gold standard for upgrade here is somewhere between $65 million and $70 million. What can we do with that extra money? Not a thing because the feds have said that you can only use it for upgrading unemployment insurance.

With regard to the statement from the Senator from the 10th District, that reducing debt does not create jobs. I give you the example of road funding. Twenty-two percent of road funding goes to debt service. If we reduce that debt, we could build more roads not only this year, but forever.

So we need to have flexibility of the kind that we have in this resolution. I urge support.

 

Senator Bishop’s first statement is as follows:

I rise today to speak to the resolution and to discuss the federal stimulus package. Despite the substantial budget problems facing state governments, the federal government crafted the American Recovery and Reinvestment Act in such a way to prohibit states from cuts to a substantial percentage of each state’s budget. Moreover, states are prevented from doing the right thing, such as paying down debt service with that stimulus money.

The practical result of the federal restrictions is that 47 percent of Michigan’s General Fund/General Purpose budget is effectively off the table from consideration, even in the face of a $1.7 billion deficit that we are forced to reconcile. As a consequence, the cuts that must be made can only come from other priority areas, such as health care, police and emergency services, local government services, road infrastructure, and other core government functions.

I think we can all agree that if there is a silver lining in these very challenging times, it’s the fact that state governments and governments as a whole are forced to focus on priorities of government. What is the core function of government? They are forced to right size their operations, pass long overdue reforms to broken, unproductive systems, and learn to deliver essential services more efficiently and effectively with less money.

The irony of the stimulus bill is that it actually restricts states from making the necessary cuts and reforms to their own state budgets and to properly manage their own budget crisis, thereby enhancing the probability that the dysfunction that caused the current crisis will continue. In fact, the stimulus bill goes a step further. In many cases, it requires states who accept their own taxpayer money to build and sustain a bigger government, a permanent government, which is exactly the opposite, the worst thing that any state should be doing right now that faces the same budget crisis. After all, I think we can all agree that the first order of business when you first find yourself in a hole is to quit digging.

States cannot print money like our federal counterparts. We simply cannot sustain the present rate of growth. The federal government has to recognize that fact, and take its claws out of state government so that we can properly manage our state resources. So, in the spirit of stimulating the economy, this resolution is a request to the federal government to give the state of Michigan the opportunity to do the right thing and reform our state budget to give us a fighting chance of stabilizing a state budget that is long overdue for right sizing and reform.

Accordingly, by this resolution, we are asking the federal government to waive federal mandates against states’ who genuinely want to resolve budget crises without growing government at the expense or our children and future generations. The state of Michigan—we can all agree on this—desperately wants to begin its recovery, but as long as our state government continues with the status quo and business as usual, we will continue to repel business and chase families from our great state.

The impact of the strings attached to the stimulus money is that states are implicitly abdicating their authority and discretion related to meeting our essential responsibilities and establishing budget priorities to meet our constitutional obligations to provide core services such as health, public safety, and educating our children. We, therefore, by this resolution memorialize Congress and the President of the United States to provide for waivers from requirements attached to the stimulus funding that would hamper the state’s effort to meet its constitutional obligation to balance future budgets. I urge your support.

Senator Bishop’s second statement is as follows:

I thank the Minority Leader for his question. I think it is a good one, and I am glad that he asked the question. A couple of months ago, I did send that letter to Harry Reid and the good Speaker of the House Nancy Pelosi with a number of concerns that I had with the direction of the federal government. In that letter, I asked the federal government to ask the states to provide a plan on how they were going to reduce their budgets and how they were going to balance their own budgets before they send a dime to the states. To me, that sounded reasonable, especially in light of the fact that the federal government was in the process of excoriating, very publicly, our automakers for the way they had conducted their business and the way they continue to have troubles in the industry.

I thought it was fair that since we decided to ask the automakers to provide a plan, we ought to be asking the state governments to provide the same kind of plan, instead of just cutting a blank check and saying go ahead and have at it. That was the purpose of that letter, and I stand by that letter. I think had the federal government taken the opportunity and made that a requirement in this process, we wouldn’t be in the position we are in right now and we couldn’t be. States would be forced to balance their budgets before they even thought about the stimulus money.

Now we are in a position where we are trying to balance our budget, and at the same time, we are told that we can’t address budget concerns because 47 percent of our state budget is off limits. That is the point of this resolution. It asks the federal government to relax the restrictions, so that a state like Michigan can do what it has to do, which is to resolve a very serious budget crisis. This request has been made by different states. The good governor from Florida has made the request and received a waiver to do what I am asking to do. I would think in a state like Michigan, we would probably have some standing to ask for this request. We are a state that has been devastated by an economic crisis, and the federal government should take notice of that fact. Instead of putting restrictions on how we can save our own situation, they ought to be providing us help, services, and resources on ways that we can resolve our own budget shortfall. I’m not asking for extra money. I am just saying get out of our business, and let us do what we need to do.

States are sovereign, and we have a right and an obligation pursuant to our Constitution to balance our budget. This resolution is important to this state and the future of our budget negotiations. I ask for your support.