Last Friday, Gov. Snyder signed into law a pilot program to test welfare family members for illegal drug use. So, in the spirit of fairness for keeping all welfare recipients in line, Michigan should require corporate leaders who receive state subsidies to submit to drug testing. In truth, there was legislation to that effect introduced by Rep. Tom McMillin (R-45) last year — unfortunately it died in committee. Earlier this month, McMillan broke with fellow Republicans in the lame duck session and voted against the welfare drug-testing bill.
So, if Michigan were to test corporate welfare CEOs and board members, just how many cups would the state need?
Michigan remains near the top of the list for handing-out corporate subsidies, second only to New York in total number of recipients, and holds fourth place nationally for cumulative dollars devoted to corporate welfare. According to the “Subsidy Tracker” at Good Jobs First, the rust belt state has doled-out $10,440,043,930 to 15,205 companies in recent decades.
Last year, Good Jobs First tallied-up what are known as “megadeals” — Michigan topped the list for brokering the most high-dollar subsidies for single corporate entities. In the Good Jobs First report, Megadeals: The Largest Economic Development Subsidy Packages Ever Awarded by State and Local Governments in the United States, Michigan was found to have made fully 29 outrageously over-the-top corporate tax give-aways — making the state the national leader, with New York coming in second at 23. Michigan forfeited a whopping $7,101,236,000 in megadeals to mostly large fortune 500 type companies for little in return. Much like Snyder’s tax breaks, these bonuses were untethered to any real and measurable job growth — they were nothing more than a trickle-down wish and a prayer.
The top ten Michigan corporate welfare queens:
For a complete list of all Michigan deals, including additional megadeals, click here. Rest assured, the state will need a lot of specimen cups.
Other findings in the report, including national trends, are equally disturbing:
- Of all fifty states, Michigan accounted for fully 12 percent of all the “megadeals” with corporations for favorable tax environments.
- Nationally, since 2008 the number of megadeals has roughly doubled. While the tax game has been mostly bipartisan, it is interesting to note that as states have been increasingly become politically red, and Tea Party influence has grown, so has this give-away trend.
- The average cost per job “created” under this tax scheme is an obscene $456,000 a piece. Not a bargain, but instead the result of something termed “trophy deals” wherein states compete against each other for a manufacturing facility.
- One in ten deals involve relocating within the same state, sometimes in the same municipality, often struck as a “retention” deal. Threats are frequently made to abandon previously agreed deals in a bid to blackmail for even more money.
- Among the corporate goons perpetrating this on states are sixteen of the Fortune 50 companies. Among the most active tax dodgers are: Wal-Mart, all of the “Big Three” automakers, Exxon Mobile, Royal Dutch Shell, Boeing, Airbus, Citigroup, Goldman Sachs, Walt Disney, ESPN, Sears, Cabelas, General Electric, Dow Chemical, Amazon, Apple, Intel, and Samsung.
- Fifty-six of these megadeals went to companies located outside the United States.
Not a wise use of taxpayer dollars. And neither is Michigan’s new law.
The Senate Fiscal Agency reports that the cost of administering the welfare drug-testing program would run between $700,000 and $2.4 million, with a potential savings of $2.2 million in reduced case loads due to positive tests where the recipient refuses treatment. The x-factor though is the potential cost to the state for administrating treatment to those who do consent. No appropriation was made for the pilot program, so the cost will be absorbed through the Department of Human Services general fund.
As the law is written, if the head of a household tests positive for substance abuse and refuses treatment, children would lose their benefits. Of Michigan’s total case load, approximately 13,000 are for “child only” benefits, which would not be subject to potential testing, leaving 19,800 households under suspicion, many with dependent children.
The Senate report estimates that about 5 percent of welfare recipients are drug users — a number similar to that of the general population — a group that includes corporate leaders.