Why Michigan loses people to other states
Policies that attract populations to other states are opposed by Whitmer and unmentioned by growth council
Michigan has lost population over the last 20 years. Gov. Gretchen Whitmer’s Growing Michigan Together Council hopes to reverse that trend by studying what works elsewhere and what’s not working in Michigan.
The governor, however, actively opposes some tactics other states use to grow their population.
While the council ponders how to address the state’s population loss, the answer is economic liberty, said Michael LaFaive, senior director of the Morey Fiscal Policy Initiative at the Mackinac Center for Public Policy.
“[F]or every 10 percent increase in personal taxes, Michigan loses 4,700 people every year thereafter,” LaFaive wrote in 2010.
The 11.5% increase in the personal income tax, enacted in 2007, drove more than 10,000 people out of Michigan, LaFaive wrote. The Legislature implemented what was supposed to be a temporary tax increase in 2007, taking it from 3.9% to 4.25%.
The tax increase was partially rolled back, going from 4.25% to 4.05%, in 2023. Whitmer’s administration is fighting to prevent the lower rate from becoming permanent. The Mackinac Center Legal Foundation has filed a lawsuit arguing the tax cut is permanent, not event-driven, as Attorney General Dana Nessel says. Two lawmakers have joined the suit.
Right-to-work is also a factor that drives population growth, according to LaFaive. Whitmer signed a repeal of the 2012 right-to-work law earlier this year.
“The administration made repeal of a demonstrably effective economic development, interstate migration and population growth tool a top priority in early 2023,” LaFaive told Michigan Capitol Confidential. “This was a bad decision if lawmakers are really looking to goose job opportunities and an inflow of people to the Great Lakes State.”
Michigan Capitol Confidential reported in January that in two years, 2.1 million people had moved from states without right-to-work laws to states with those laws.
Right-to-work also produces higher wages, which contributes to population growth. Per-capital income increased 21.9% in the ten years after Michigan’s right-to-work law was passed in 2012. Personal income only grew 0.5% in the ten years before that, when there were no right-to-work protections.
Neither the council nor Whitmer responded to an email seeking comment.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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There is no such thing as ‘the state’s dime’
There are no free school lunches, rides on the QLine, or community college classes; taxpayers always foot the bill.
There is no such thing as free community college. In Michigan, taxpayers are footing the bill.
One might not get that impression from a recent report from WWMT-TV in West Michigan. It is the most recent news outlet to describe this program without mentioning the people who have to pay for it.
“A program that gives Michiganders the opportunity to go back to school on the state's dime has officially expanded to include anyone older than 21,” read a Thursday tweet.
Michigan Reconnect now allows Michigan residents 21 years old and older to pursue an associate degree or a skill certification, free of charge. The old cutoff, prior to the 2024 budget, was 25 years old.
That expansion cost $70 million. That is “the state’s dime” only in the sense that people attending college don’t have to pay. The working taxpayers of Michigan are the people providing the money.
To describe it as “the state’s dime” puts politicians like Gov. Gretchen Whitmer in a position to get credit for payments made by others.
While Whitmer and lawmakers did support the Michigan Reconnect program, none of this would be possible without taxpayer funds. Every dime the state has was first taken from a taxpayer or a fee payer. That’s true also of federal dollars that pass through Michigan. There is no Mr. Michigan sitting around writing checks.
According to reporter Rachel Louise Just, fewer than 10% of the people who’ve enrolled in Michigan Reconnect have completed the program, or about 3,000 out of 32,000.
Whitmer wants 60% of Michigan residents to hold a post-high school certificate or degree by 2030. She pushed for the expansion of Michigan Reconnect to reach that goal. Whitmer calls it “60 by 30.”
But James Hohman, the Mackinac Center’s director of fiscal policy, said the state has little understanding of why people drop out and little reason to believe this expansion will reach the 60 by 30 goal.
“Policymakers are spending more money to get to a goal, but they don’t know whether or not the spending actually leads to the goal,” Hohman wrote in July. “They could find out the answer to that question. Yet they’re going to spend more and expand program parameters without getting that answer.
“The lack of results or interest in results ought to matter more. Lawmakers are forcing taxpayers to cover community college costs for people over 25 or 21, without bothering to find out whether that is a good use of money. They ought to care whether the people who participate in the program do better because of it.”
James David Dickson is managing editor of Michigan Capitol Confidential. Email him at dickson@mackinac.org.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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