Michigan's Benedict Arnolds

Stephen Moore

Wall Street Journal

October 4, 2007

Michigan Republicans and the state's leading taxpayer group are seeking revenge against the "turncoats" in the GOP who voted for what is being called the $1.7 billion "Granholm revenue grab" last Monday.

Party officials I talked to this week said there's "a movement afoot to get the pro-tax Republicans recalled." "We're not discouraging it; we wouldn't mind ousting them from the legislature and the party," one GOP official told me.

Democrats were stalemated on the tax hike without key Republican defections. The state Senate in Lansing is controlled by Republicans, but three Republicans crossed over to provide the margin of victory. They were Ron Jelinek, Valde Garcia and Wayne Kuipers. In the House, two Republicans voted for the income tax increase: Chris Ward and Ed Gaffney. This allowed swing-district Democrats a free "no" vote to inoculate them from attack.

The Michigan Taxpayers Alliance has already laid the groundwork for the recall effort. The group is working to collect signatures for the 2008 ballot and is already agitating in the districts of the defecting Republicans.

Michael LaFaive, the fiscal analyst at the Mackinac Center, a conservative think tank in Michigan, says: "Talk radio lines have been lit up ever since the early Monday morning vote was announced. People in Michigan are livid." He points to recent polling that found that two of three Michigan voters preferred spending cuts over tax hikes to close the budget gap.

There is a precedent for voter backlash against tax hikes in the Wolverine State. Back in 1983, a similar giant tax hike led to a recall effort against four state legislators, with two Senators getting ousted in 1984. This gave the majority in the Senate to the Republicans and lifted John Engler to the majority leader position, before he was elected governor.

What has voters so angry is a state economy that's already reeling from job flight and high taxes. Most voters aren't buying Governor Jennifer Granholm's line that the new taxes will pay for investments to make the state a "21st century knowledge-based economy." Michigan's 7.4% unemployment rate is the highest in the nation. The state ranks third in mortgage foreclosures. Says economist Gary Wolfram of Hillsdale College: "I suspect if we increase the minimum wage, establish a 6% tax on small businesses that provide services, and increase the income tax by 45%, we will be able to get the unemployment rate in Detroit over the 25% mark."

State legislative Republicans are trying to put the blame on Mrs. Granholm and the Democrats, but they privately concede that they would have prevailed over this largest tax increase in the country had they simply held their own caucus members. That means, and rightly so, the long knives are now out for pro-tax Republicans.