Gov. Schauer: Granholm, Part 2

Posted by hpayne on June 4, 2013

Democratic gubernatorial candidate Mark Schauer

“Governor Snyder cut corporate taxes,” Democratic gubernatorial candidate Mark Schauer told the Frank Beckmann Show at the Mackinac Policy Conference last week, arguing that One Tough Nerd’s tax breaks have benefited wealthy special interests. “But we need an economy that works for everybody.”

Sure we do.

But, populist rhetoric aside, Schauer is not at all opposed to wealthy special interest tax breaks — so long as they discriminate on the behalf of politically favored industries that Democrats support. It is the same ol’ crony capitalism championed by Jennifer Granholm during Michigan’s lost decade.

“I’m for targeted tax breaks that create jobs,” Schauer double-spoke moments later, echoing Granholm handouts that aided rich Democratic special interests like Big Green, Big Hollywood, and Big Labor.

Not only would Schauer turn the clock back on Snyder’s flat tax reform, but he would market a Swiss Cheese of loopholes that has made the federal code so ripe for abuse by the IRS. Meanwhile, Snyder’s simplified tax reform has made Michigan a national model for a less-politicized tax system.

“We need to get rid of the crony-capitalist insider deductions and exemptions which have given the IRS so much power,” writes CNBC economist Larry Kudlow. That is exactly what Snyder has done here.

But for pro-government activists like Schauer, that is a problem. Their power derives from being tax code gatekeepers for the well-connected.

“We’re supporting a Green Manufacturing Loan Program that would help manufacturers retool to be more energy-efficient,” says Schauer of a buffet of loans and tax treats he has lobbied for as a national co-chairman of the Blue-Green Alliance, a consortium of Big Labor and Big Green special interests.

The plan is a clone of the Granholmnomics that showered tax breaks on green businesses last decade even as Michigan’s median household income dropped by 21 percent, which was three times the national average.

As a state senator, Schauer cheered Granholm’s $1 billion green “investment” as a job creator. Yet, according to the U.S. Bureau of Labor Statistics, green jobs are just 2 percent of Michigan employment today while Michigan’s landscape is littered with bankrupt firms that Granholm and Schauer lavished with taxpayer money. Four of the nation’s eight biggest green bankruptcies — A123 Systems, Azure Dynamics, United Solar Ovonics and Evergreen Solar — had operations in Michigan and received millions in state subsidies, reports the Mackinac Center’s Capitol Confidential.

Schauer claims Michigan’s economy has struggled since Snyder derailed the gravy train, but in truth Michigan has America’s sixth-fastest recovery. Yes, Snyder failed the cardinal rule of flat tax reform — slash rates as you cork loopholes. As a result, taxpayers have had no sugar with their castor oil. But the state’s stubborn 8.4 percent unemployment rate is a symptom of a national economy that has failed to gain traction because President Barack Obama repeated Granholmnomics.

Just like Michigan, Washington diverted billions of tax dollars to now-bankrupt firms like Solyndra and Beacon Power while crushing less-favored industries with regulation.

Just like Michigan, Schauer voted for Obama’s green goodies as a first term congressman in 2009-10.

And just like Michigan, the national economic playing field is tilted against the working class and in favor of politically connected fat cats. Democrats claim policies that favor “Main Street not Wall Street.” But the reality is much different.

“The average U.S. household has recovered only 45 percent of the wealth they lost during the recession,” according to a report from the Federal Reserve Bank of St. Louis, which finds that two-thirds of the increase is due to rising stock prices. That rise has disproportionately benefited the rich.

From Granholm’s million-dollar subsidies to A123 Systems to Obama’s $7,500 tax breaks for Leo DiCaprio to buy six-figure electric cars, gubernatorial candidate Schauer has voted to line the pockets of the politically connected. Now he wants to make another sequel?


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