A Governor`s Story, by Jennifer Granholm: on Tax Reform

Jennifer Granholm: 2003: GOP tax policy based on unimaginably rosy assumptions

Then the inevitable downturn would come. The boom-or-bust cycles were exasperating, but Michigan was unfailingly resilient.

The latest economic downturn had a new twist. Republicans who controlled things around here for a decade effectively built a new state tax structure-- and built it when economic conditions were at their peak and with economic assumptions that were unimaginably rosy.

On top of the rosy assumptions, they also adopted more tax cuts that will roll in automatically over the next few years, with no offsetting revenue increases to pay for them. The business tax rate is scheduled to drop each year until business taxes go away altogether.

Jennifer Granholm: Lower taxes DID create jobs, but not necessarily in America

To be clear, the cuts DID create many jobs--but not necessarily in America. Michigan's tax cuts, and those championed by Pres. George Bush at the national level, freed up capital for investors and companies. But much of that capital was being investigated far from Michigan and away from our country altogether.

The corporate and personal income tax burden in Michigan during 1999-2009 fell more than in any other state in the country--from 12th highest to 39th in the case of state and local taxes--yet people and businesses were still exiting our increasingly inexpensive state.