Tuesday, December 22, 2009
I lived in the metro-Detroit area for a little over 2 years. The large building that is shown several times in the course of the film is in downtown Detroit. It's about 10 blocks from city hall and the "river front". If anything, Steven down plays how bad it really is there. There are thousands of abandoned buildings, and hundreds of derelict factories. The suburbs are starting to look just as bad as the city. When my wife and I fled in August of 2004, nearly 1 in four of the houses on our street had for sale signs.
This is what the Democratic Parties leadership of the state legislature has wrought. In June, Michigan became the first state in 25 years to suffer an unemployment rate exceeding 15%, according to the Labor Department. That of course is the "official" unemployment rate...but in reality it is far, far higher. Once you fall off of the unemployment roles, (i.e. your benefits run out) the state stops counting you. I have friends that have been unemployed for years...literally, years since 2003-4. Since the Michigan meltdown started in 2003. When we moved, I had been out of work for 16 months, and my wife for 12. We were lucky, we were able to leave.
The state income tax rate isn't that high, and is presently estimated at 9.4% of income, Michigan's state/local tax burden percentage ranks 27th highest nationally. On the other hand the business tax rate is among the highest in the nation, with a base rate of 4.9%, and a surcharge is applied to the apportioned business
income tax and gross receipts tax before credits. That rate
is 21.99%. Which is why so many business that COULD have long since left the state. This is the same model that California uses...to the same result, businesses flee when the tax rate rises too high.
This is the model Mr. Obama is using for the country...but the real problem is, where do WE flee to when the tax rate rises too high?
UPDATE: The Department of Labor just released new unemployment figures for the city of Detroit...unemployment is 50.4%. Every other person is out of work. The metro Detroit unemployment rate is almost 30%. That's an average of of 4 out of every 10 people out of work. But Mr. Obama said that if the "stimulus" was passed in Feb, that unemployment wouldn't pass 8%...so is it working yet?