Supreme Power of the Speaker of the House leads to abuse:

 

Most everyone is familiar with the general work of government and how the process functions.  We have all taken courses in high school that have gone over the basic process of how a bill becomes a law and how our branches of government operate.  What many of you may not know, is how things really work on the inside and I want to take a little time to illustrate how dysfunctional the House of Representatives really is when it comes to the power of our Speaker of the House.

 

Both Republican and Democratic House speakers have abused their power for years.  The problem is that in the state of Michigan, the speaker derives that power from long standing House rules.  As you will see, these rules need serious changes.

 

The Speaker of the House is selected by the majority party via a vote, and in this case by the Democrats; therefore, the majority party, through the speaker, controls everything in the House.  Not even the Federal speaker, Nancy Pelosi, has such powers granted her as Michigan's Speaker of the House has in this state.

 

For example:

• The Speaker can fire anyone’s staff at will.  I was elected by over 90,000 people and should have the right to determine who can best help serve our area.
• The Speaker decides what a representative can pay his own staff with his own budget.  He has denied pay raises simply because he did not like the staff person or the member. 
• The Speaker decides what each elected official's office allotments is.  Presently Republican lawmakers get several thousand less than Democrats to run their office, send mailings, pay their staff and pay for phones etc..  Since we are elected by taxpayers, every office should receive the same, yet there is special treatment for the speaker’s party.
• The Speaker can remove, substitute, or put any legislator he wants on any committee at will. This means that members are often hesitant to speak up on behalf of their constituents needs and wants for fear of retribution.  That’s not democratic.  It is an abuse of power.  Even Nancy Pelosi in the federal government doesn’t have the right to remove the other party's members from standing committees.
• We’ve even had a parking spot taken away from a representative because the Speaker was not happy with him. This individual had just had knee surgery.  Truly this was cruel and childish.
• The Speaker decides which bills receive a vote on the House floor.  If he doesn’t like the bill or believes it will impact one of his party's members poorly, we don’t get to vote on it.  There are many bills that would really help this state but never see the light of day because of the speaker.
• The Speaker has also broken the state constitutional and House rules by not allowing votes on amendments on the House floor, as required by Article IV section 18 of the Michigan Constitution.  When 22 hands are raised to vote on an amendment to a bill on the House floor, we’re supposed to vote.  The chair simply says there is no support and dismisses the vote.  This has occurred hundreds of times.  Consequently, bills are allowed to proceed without due process and good changes.  The Speaker has even ignored written signatures of over 40 members calling for votes in many instances.

 

State Revenue Numbers:

 

For those of you interested in the latest revenue numbers, below you will find the August quarterly revenue report issued by our House Fiscal Agency.  As you can see from the numbers, our tax revenue continues to decline overall.  This has been the case for the last six consecutive quarters.  This is exactly what will continue to occur as long as Michigan overtaxes, over-regulates, and overspends its budget.  The state must get its fiscal house in order and restructure our regulatory environment to assist our businesses in job creation.

 

 

TOTAL REVENUE:  13 MAJOR TAXES AND LOTTERY

 

3rd Qtr FY 2008-09	3rd Qtr FY 2009-10	3rd Qtr Change	YTD Change
$4,730.2 million	$4,515.1 million	-2.4%	-4.8%

 

Revenue collections for third quarter (May-July) of fiscal year (FY) 2009-10 were lower than third quarter FY 2008-09 revenue collections by $114.0 million or 2.4%.  Total collections fiscal-year-to-date (FYTD) were $12.9 billion -- down $651.7 million or 4.8% from a year ago.

INCOME TAX (NET)

 

3rd Qtr FY 2008-09	3rd Qtr FY 2009-10	3rd Qtr Change	YTD Change
$1,539.6 million	$1,563.4 million	+1.5%	-11.5%

 

Income tax revenue consists of three components- withholding, annual payments, and quarterly payments.  Withholding payments are based on workers' earning and makes up almost 81% of gross income tax collection.  Annual and quarterly payments are based on self-employment earnings and other income sources, such as capital gains.

 

Net income tax collections (which include income tax refunds) for third quarter FY 2009-10 were higher than third quarter FY 2008-09 collections by $23.8 million or 1.5%. Withholding payments were up 0.7%, quarterly and annual payments were down 0.9%, and refunds were down 4.4%.  Net income tax collections FYTD were $3.8 billion -- down $487.6 million or 11.5% from a year ago.

 

SALES AND USE TAXES

3rd Qtr FY 2008-09	3rd Qtr FY 2009-10	3rd Qtr Change	YTD Change
$1,795.0 million	$1,861.1 million	+3.7%	+2.7%

 

 

 

Sales tax collections are derived from the sale of taxable items such as motor vehicles, furniture, apparel, food consumed at restaurants, and other general merchandise.  The use tax is applied to telephone services, leased motor vehicles, hotels and motels, gas and electric utilities, and remote sales.

 

BUSINESS AND INSURANCE TAXES

3rd Qtr FY 2008-09	3rd Qtr FY 2009-10	3rd Qtr Change	YTD Change
$753.1 million	$604.4 million	-19.7%	-13.0%

 

 

 

Michigan Business Tax (MBT) is applied to gross receipts less purchases from other firms and business income or net profit.  The insurance tax is based on insurance premiums.  For third quarter FY 2009-10, business tax collections were below the year-ago third quarter by $148.6 million or 19.7%.  Business tax collections FYTD were down $269.3 million or 13.0% from a year ago.

 

OTHER REVENUE

3rd Qtr FY 2008-09	3rd Qtr FY 2009-10	3rd Qtr Change	YTD Change
$642.5 million	$587.1 million	-8.6%	-1.9%

 

Other revenue collections -- primarily state education tax, real estate transfer tax, tobacco tax, and lottery revenue -- for third quarter FY 2009-10 were down $55.4 million or 8.6% from the third quarter of FY 2008-09.  Other revenue collections FYTD were $1l9 billion -- down $36.5 million or 1.9% from a year ago.

 

As always, it is a pleasure to serve you.  Should you have any questions or comments please don't hesitate to contact me.

 

Sincerely,