Choose your own budget remedy

LANSING (WJRT) (WJRT) -- (05/02/07)--The state budget clock is ticking and every minute counts. Gov. Jennifer Granholm and state lawmakers now have less than a month to agree on a plan to balance the state budget.

If they can't agree, Michigan voters may have to ultimately assume the responsibility for balancing the books.

Although there is no official proposal on the table, the buzz among lawmakers in Lansing is let the people balance the budget.

What that means is they would put a number of tax hike options on the ballot and let you choose the one you like best. Here's a look at what the ballot could include:

Granholm favors a 2-cent service tax that would tax everything from haircuts to car washes. An across-the-board sales tax increase is also an option.

A Republican representative is recommending a fair tax proposal.

What this means is we would eliminate personal property tax, business taxes and the Michigan income tax and replace them with a 9-percent sales tax.

There is also talk of an immediate increase in the income tax if a balanced budget can't be achieved.

The state is facing a $700 million deficit and must balance the budget by June 1. If lawmakers can't agree to a tax increase, the governor has said she will balance the books with cuts to education and health care.

All parties are still hopeful that something can be worked out.

"We're meeting constantly I'm still hopeful for a compromise, I'm willing to compromise on anything," Granholm said.

"But I want the people to know that investment in education is critical and also that I have a constitutional obligation to balance the budget."

"What we are seeing now is almost a game of chicken where each side -- both the governor and the legislature -- daring the other to make a move to bring in more revenue," said Mott Community College Prof. Paul Rozycki.

"I mean, the bottom line is in any state you've either got to raise taxes and bring in more revenue or cut programs."

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