Friday, October 12, 2007

Michigan Service Tax Anger


In today's Detroit Free Press website, Tom Walsh posted an article implying that people were over-reacting to the new service tax and taxes in general for Michigan.

One of those "over-reacting" readers wrote the following:


Mr. Walsh appears to be incredulous as to why we are so angry with regard to having our taxes increased at a time when this state has the highest unemployment in the nation.

Well Mr. Walsh here are a few reasons.

Commie Granholm said we have not had a tax increase in over 12 years and we taxpayers have little patience for a LIAR!

Michigan has had 12 years of tax cuts------------------------FALSE
Michigan’s income tax was 4.6% before----------------------TRUE
Michigan’s income tax is now 3.9%-----------------------------TRUE

When Michigan voters lowered income tax from 4.6% to 3.9% Sales tax was 4%-------------TRUE
Prior to Michigan lowering income tax to 3.9% there was no 8.6% real estate transfer tax—TRUE

After Michigan lowered income tax, sales tax was raised to 6%--------------------------------------TRUE
After Michigan lowered income tax, new transfer tax was created------------------------------------TRUE

With Michigan lowering income tax and raising sales tax and transfer tax, the States revenue was the same meaning the lower income tax was offset by the increase in the other two taxes. -----------------TRUE

Now Michigan is the ONLY state to have both a service tax and a transfer tax in the nation. ------TRUE

Don’t believe me, listen to Granholm grudgingly acknowledge it on audio.

Here is the web site to the Frank Beckman show:

Also listen near the end of the clip where commie Granholm claims she never made a pledge to not raise taxes and then listen to Frank Beckman play the clip where in fact she did state that.

On October 16th 2006 during the third debate. Channel 7 reporter asked Granholm if she would raise taxes. Her answer: "NO"

Or maybe the taxpayers are upset that the Governor who claims to feel our pain doesn’t give us a break at the gas pump.

the figures below were based on 80 cents a gallon so triple the states take of over $1.29 a gallon times the number of average gallons in a car of say 18 equals $23.22 cents a fillup we are paying to the state.

• Federal Tax 18.3
• State Excise Tax 19
• State Sales tax 6%
In Michigan the sales tax is applied to the actual sales cost + Federal Tax. So Michigan not only is taxing gasoline for non-road use (the sales tax revenue goes to the general fund - not roads) but also is taxing a tax.
Total taxes per gallon assuming a sale price of 80 cents per gallon is ((80 + 18.3) * .06) + 18.3 + 19 = 43 cents per gallon.

Or just maybe the taxpayers of this state do not like a commie at the helm who truly thinks our money is HER money to spend as she please with whom she pleases.


"It's not just about me, me, me. It's about investing in Michigan," she said. "Where's the notion of the common good? It's been lost over decades because there's been ... this idea that it's your money, it's your money.
Yeah, that's a little anger.


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There is always an easy solution to every human problem—neat, plausible, and wrong.
Henry Louis Mencken (1880–1956)
“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
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Tracking Interest Rates

Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)