When special interests collude to reward themselves, it’s a safe bet that the rest of us, whether in Lansing or in Washington, won’t benefit.
When special interests collude to reward themselves, it’s a safe bet that the rest of us, whether in Lansing or in Washington, won’t benefit.
Midland, Michigan — Call it the “trough truce.” Special interests have realized they don’t have to fight with each other for taxpayer funding. Instead, they’ve joined forces, recognizing that subsidies for everyone is an easier sell than special treatment for a single lobby. The political calculus is shrewd, but as Michigan taxpayers are about to find out, the fiscal results are scary.
The trough truce was on full display on December 14, when the Growing Michigan Together Council issued its final report on the policies that would supposedly make our state more attractive to young people and job creators. Governor Gretchen Whitmer created the council in June, and its policy recommendations are widely seen as the blueprint for her 2024 legislative agenda. The council may even provide the policy vision for a potential Whitmer presidential run.
Yet this agenda’s main beneficiaries are the special interests who, as the council’s members, wrote the final report. They range from labor-union executives and trade-association presidents to nonprofit leaders, K–12 and higher-education administrators, and representatives of racial interest groups. With few exceptions, their organizations want more taxpayer funding for their narrow issue areas. But there’s nothing narrow about the council’s recommendations. It envisions the most sweeping spending plan in Michigan’s history, which involves every special interest getting more than its fill of taxpayer funding.
According to the policy recommendations, the business community would get subsidies galore, with “refreshed economic and workforce development incentives” that pad job creators’ pockets. Individual workers, too, would get subsidies so long as they make a “commitment to live and work in Michigan.” Taxpayers can expect a new “equitably and efficiently funded education system.” While the details are vague, the demand for money is clear in the council’s proposal for extra funding for public schools and more state-backed scholarships and free tuition in higher education. There would be “robust public transit,” with new rail lines between to-be-determined cities and mass-transit options in places such as Detroit that already have plenty. Home buyers would get “down-payment assistance” while home builders would get subsidies. There would also be a new “private-public lender” that would undoubtedly make losing bets with taxpayer money.
Nowhere in its report does the council estimate how much these proposals would cost, but the answer is almost certainly in the tens of billions of dollars. Governor Whitmer has already enacted $6.3 billion in subsidies and incentives for a limited number of companies. Yet the council wants a comprehensive, incentive-driven “economic growth plan” that throws taxpayer money at many more businesses and organizations. To fund that and the council’s many other demands, Michigan will clearly need tax hikes. Everyone who wants more money agrees on that point. After all, you have to make sure the trough is full.
The trough-feeders are united in supporting the largesse, even though each one would benefit from just a slice of the pie. At first glance, the bedfellows seem odd. Aren’t teachers’ unions skeptical about handing over billions of dollars to Big Business? The broader strategy seems strange as well. Wouldn’t it be more effective for special interests to argue that their demands are reasonable while the other guys’ requests for taxpayer funding are foolish and unaffordable?
But that’s not how the trough truce works. If K–12 superintendents criticized corporate handouts and corporate leaders attacked mass-transit boondoggles, taxpayers might realize that they’re being played for fools, which might lead to a bigger debate about whether anyone should be subsidized. It’s better, according to the truce’s logic, to stand together than fall apart. Forget a rising tide that lifts all boats — a bigger trough feeds more mouths.
Michigan is hardly unique. The spending binge that’s about to take place in Lansing is familiar to other states, and federal policy is the biggest feeding trough of all. Every spending package includes loads of goodies for plenty of good old boys, and the idea of a “narrow” handout is laughable. The 2022 CHIPS Act gave about $52 billion to chipmakers — and $227 billion to other, related special interests. Such bills aren’t compromises by which competing interests get part of what they want. Rather, they’re coordinated efforts to help everyone get everything they demand, taxpayers be damned.
Whether it’s in Washington, D.C., or Michigan, the trough truce is becoming broader and vastly more beneficial for its members. It is also encouraging more special interests to demand that taxpayers feed them, too. The ultimate problem isn’t any particular spending bill but the trough itself: It spells disaster for America’s fiscal sanity and economic stability. So long as even a single special interest gets its fill of taxpayer funding, everyone will continue to clamor for a part in the feeding frenzy. The only way out of this mess is for voters to elect leaders who make government better instead of just bigger.