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Opinion: Shutdown threats bad for business

Greg McNeilly

Government shutdowns are bad for working families. Michigan learned that the hard way just a decade ago, when a pair of shutdowns paralyzed the state, took police off the road, and put the proverbial flashing neon sign at the state’s southern border, warning workers and job creators to stay far, far away.  

Gov. Gretchen Whitmer meets with The Detroit News' editorial board at Cadillac Place in Detroit, Monday.

Here we go again. Gov. Gretchen Whitmer is threatening to shut down state government this year if Republican lawmakers don’t acquiesce to her demands for a regressive $2.5 billion annual hike in our gas tax, a $600 a year punch in the gut for working families who can afford it least. 

It’s a dizzying 180-degree turn for a governor who just a few years ago lambasted moves by Republicans at the national level that she worried might then lead to a government shutdown. “The… Party has a wing now that’s gotten very, very active and makes threats,” she lectured, calling shutdown advocates “bold and active and destructive.”

She was right. Shutting down state government would indeed be destructive to Michigan’s comeback and grind local families’ economic progress to a screeching halt. 

Since the governor’s asked us to contemplate a shutdown, let’s. The stakes are not insignificant. Michigan knows this better than most states, and we know it from not-too-distant experience under our last Democratic governor.

State employees are laid off and paychecks are delayed while economic activity across the state is impacted in an ugly chain of events. Families are forced to cancel vacation plans. Businesses around state government offices — like restaurants, bakeries, dry cleaners — watch patrons disappear. Spending slumps, which means economic activity drops, which means tax revenue goes down.

Businesses that rely on regular interaction with state government are hamstrung. The state that put the world on wheels has a tough time putting Michigan residents in new and used cars, when dealerships are unable to process registrations, tabs, and new license plates with the Secretary of State. 

Job creators working to open a new business have to push the pause button if they’re unable to apply for a business or professional license — or see their applications delayed by a work stoppage.

Confidence in state government plummets during a shutdown, too, and not just among local residents. The state’s standing with credit agencies is also put at risk, impacting the way it is able to borrow, potentially raising the prices residents ultimately pay for many government spending projects. The costs to hardworking taxpayers grow.

Individuals who rely on, or frequently use, government services are acutely impacted as well. Back during the “Lost Decade,” a pair of government shutdowns threatened closing Secretary of State branch offices, shutting down state parks, shuttering the state Department of Education, closing historical sites and the Library of Michigan, limiting veterans’ services, shutting down the Department of Natural Resources, and dangerously pulling four-fifths of the Michigan State Police off the street — among many other service interruptions.

According to media reports at the time, 35,000 of the state’s then-53,000 employees were laid off. That created additional cascading damage. UAW Local 6000 filed 16,000 individual grievances, while the MSEA union publicly threatened legal action. Workers were focused on fighting the state in court, instead of delivering on state projects and investments.

The kicker? Government shutdowns delay road construction projects, too. 

Voters elected the governor to fix the roads, not to let them fall into further disrepair. Voters expect the Governor to get the job down, not throw temper tantrums. They expect no excuses. And they don’t expect to pay an additional 45 cents at the gas pump. 

Michigan deserves better than another shutdown and no solutions due to failed leadership by the governor.

Greg McNeilly is president of the Michigan Freedom Fund.