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Michigan citizens need to think about what's best for everyone rather than just themselves if the state is to reinvent itself, Gov. Rick Snyder told the Michigan Association of Broadcasters on Wednesday.
The Republican governor defended his nearly $2 billion in business tax cuts and the income tax changes he wants to make to offset that, including a tax on pensions that has drawn criticism.
People naturally object to changes that affect their bottom line, he said. But residents need to think not just about their current circumstances, but what changes will make Michigan a better place for their children and grandchildren, he added.
"In our hearts, we know it's time for `we' to happen," he said at the end of a half-hour speech. "By following through on that `we' attitude, we'll have an exciting future."
The state is facing an estimated $1.4 billion shortfall in the upcoming budget year that begins Oct. 1.
The new governor has been criticized for proposing deep cuts to public education, universities and local governments while slashing business taxes, asking people to pay more income taxes and requiring public workers to make concessions. He wants to eliminate the Earned Income Tax Credit that helps the working poor keep more of their earnings -- a move church groups and advocates for the poor oppose.
The Michigan League for Human Services this week cited a new analysis by the Institute on Taxation and Economic Policy that found households earning $17,000 or less would pay 1.1 percent more of their income in new taxes, while those making $355,000 or more would pay 1/10th of 1 percent more under Snyder's proposals. A recent league analysis also found that Snyder's plan will cut business taxes by 86 percent while increasing individual income taxes 31 percent.
"Gov. Snyder has discussed shared sacrifice as we struggle to make Michigan a competitive state again. But this new analysis is further evidence that he's asking too much from vulnerable children and their families and seniors in order to give businesses a tax break," league President and CEO Gilda Jacobs said in a statement.
Seniors plan to protest at the Capitol Tuesday against pension taxes and other changes that could cost them a combined $900 million.
The governor told the broadcasters he understands why the tax on pensions is being criticized, because all public pensions and large amounts of private pensions are currently exempt from state income taxes. But he said that's the wrong approach if the state wants to keep more of its young adults here.
"What happens if you have a large part of your population not paying taxes on your earnings and they're actually reasonably high users of services?" he asked, noting that most of the burden for paying for those government services "is getting pushed to those young people."
The governor, a former Gateway computer executive who campaigned as "one tough nerd," acknowledged that many of his policies have angered a wide spectrum of Michigan residents, including many who voted for him. He said his goal wasn't to get a lot of people mad at him but to fundamentally change Michigan's culture.
"I'm not doing so well on people thinking I'm very bright, but hopefully that nerd thing will give me some cover for a while," he joked.