Detroit Big 3 aren't the only American icon lost, and MI isn't bad for business.

[darwinism]

2 related topics of discussion from 2 separate business/economic stories;

#1: The Detroit Big 3 automakers' situation isn't unique. Good ol' American brands like Etch-A-Sketch, Gerber baby food, Rawlings baseball, Mattel toys, Converse shoes, Radio Flyer wagon, Levi jeans, and the most depressing of all --- the King of Beer, Budweiser/Anheuser-Busch, are all no longer own by our fellow Americans. And guess what, the hate has been directed at the wrong folks all along. Stop blaming the Japanese, Chinese, Mexicans, British, German, Koreans, Indians, or anybody else for that matter. Ladies and gentlemen, our own American business leaders sold us out. It is what it is.

Link


#2: Politicians have been brain-washing all of us with the notion that Michigan is the absolute worst state in America to do business. The media and other pundits have been brain-washing us about the dire tax structures here in Michigan. Well, guess what, my friends, Michigan isn't even among the top 10 worst states in the USA for businesses. In fact, many of those on that dreadful list happen to be some of the most economically solid states - such as North Carolina, Minnesota, Connecticut, and etc. Once again, we've been deceived by our very own.

Link


Do chime in with your thoughts.

[Crumbled_pavement]

I never bought the story that taxes were the only consideration for a company in determining where to locate or do business, or whether they can make money or not. The public at large doesn't have the attention span to delve into the complexity of our issues and is content with a band-aid fix for all the problems we face. Our politicians are all too happy to promise us band-aids, then they get reelected year after year but our problem only gets worse. Until the public is prepared to think deeper into the issue we will never fix the real problems.

Taxes, spending, regulations, education, immigration, and international trade all need to be restructured in order for us to continue to be competitive. Some of these issues have to be fixed at the federal level. Now, ask me which politician is serious about taking on these issues.

[Mikeg]

MI isn't bad for business

#2: Politicians have been brain-washing all of us with the notion that Michigan is the absolute worst state in America to do business. The media and other pundits have been brain-washing us about the dire tax structures here in Michigan. Well, guess what, my friends, Michigan isn't even among the top 10 worst states in the USA for businesses. In fact, many of those on that dreadful list happen to be some of the most economically solid states - such as North Carolina, Minnesota, Connecticut, and etc. Once again, we've been deceived by our very own.
Link

Do chime in with your thoughts.

ummm..... I think you must not have actually read the Tax Foundation's report that was the basis of your second link or you wouldn't have concluded that "MI isn't bad for business".

Then again, most of the defenders of the Lansing status-quo only see what they want to see and then try to justify inaction by pointing to other states that are supposedly worse than Michigan.

There's a reason why Rick Snyder successfully campaigned on providing Michigan with a lower and simpler business tax structure. I will use your own source - specifically the information from pages 9 and 10 of the Tax Foundation's "2011 State Business Tax Climate Index" report - to try and explain it to you.

Each states' Overall Business Climate Index was determined using 5 different component indexes:

Corporate Tax Index
Unemployment Insurance Tax Index
Property Tax Index
Individual Income Tax Index
Sales Tax Index

Despite calculating that Michigan has the 17th best Overall Business Climate Index, the Tax Foundation reports that Michigan has only the
- 48th best Corporate Tax Index
- 45th best Unemployment Insurance Tax Index
- 32nd best Property Tax Index

The only two component indexes that made a positive contribution to Michigan's Overall index ranking are the relatively good rankings Michigan received from the Individual Income Tax and Sales Tax Indexes.

The Tax Foundation report also states in its Introduction that

"......it is important to remember that states' stiffest competition often comes from other states. The Department of Labor reports that most mass job relocations are from one U.S. state to another, rather than to an overseas location. Certainly job creation is rapid overseas, as previously underdeveloped nations enter the world economy. So state lawmakers are right to be concerned about how their states rank in the global competition for jobs and capital, but they need to be more concerned with companies moving from Detroit, MI, to Dayton, OH, to rather than from Detroit to New Delhi."

So let's compare the report's overall and component index rankings for Michigan, Ohio and Indiana:

Michigan - 17th best Overall Ranking

48th Corporate Tax Rate Index
45th Unemployment Insurance Tax Index
32nd Property Tax Index
12th Individual Income Tax Index
9th Sales Tax Index

Ohio - 46th best Overall Ranking

39th Corporate Tax Rate Index
11th Unemployment Insurance Tax Index
45th Property Tax Index
44th Individual Income Tax Index
35th Sales Tax Index

Indiana - 10th best Overall Ranking

21th Corporate Tax Rate Index
12th Unemployment Insurance Tax Index
4th Property Tax Index
11th Individual Income Tax Index
20th Sales Tax Index

So compared to our immediate neighbors, businesses know that Michigan is still uncompetitive when it comes to Corporate Tax Rates and Unemployment Insurance costs and hardly any better when it comes to Property Tax costs.

No one is arguing that taxes are the only consideration for a company in determining where to locate or do business, but as the report emphasizes:

Taxes matter to business. Business taxes affect business decisions, job creation and retention, plant location, competitiveness, the transparency of the tax system, and the long-term health of a state’s economy. Most importantly, taxes diminish profits. If taxes take a larger portion of profits, that cost is passed along to either consumers [[through higher prices), workers [[through lower wages or fewer jobs), or shareholders [[through lower dividends or share value). Thus a state with lower tax costs will be more attractive to business investment, and more likely to experience economic growth.

[rb336]

All your commentts, mikeg, prove is that tax climate isn't everything - and may be next to nothing. A magazine that specializes in tracking new investment dollars - where companies are investing - has ranked Michigan # 1 or # 2 for the last 5 years in a row. The fact that most of our job losses have occured because of a) the implosion of the auto industry and 2) the tax relief the republicans have been offering companies to move manufacturing over-seas has severly blunted that impact on the unemployment rate.