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Original article URL: http://bridgemi.com/2012/11/flagrant-foul-called-on-taxpayers-guide-by-truth-squad/

Public sector

Flagrant foul called on ‘taxpayer’s guide’ by Truth Squad

MICHIGAN TRUTH SQUAD ANALYSIS: Michiganballot.com and “The Taxpayer’s Guide to the 2012 Michigan Ballot Proposals”

Who: Americans for Prosperity

What: Website, mailers

Truth Squad call: Flagrant foul

Michiganballot.com, and mailers that are trying to drive voters to it, present themselves as generic voter aids. They are, though, the creation of Americans for Prosperity, a group whose national office is based in the Washington, D.C., area.

According to campaign statements filed at the end of October, AFP-Michigan Ballot Committee has two big cash donors — Gridiron Communications of Granger, Ind., and AFP’s national office. Together, they’ve given more than $500,000. Michigan Ballot Committee also has received nearly $1 million in in-kind contributions from The People Should Decide, the pro-Proposal 6 ballot group created by Manuel Moroun and family.

See pages of mailers here, here, here, here, here, here, here, here, here.

Nationally, AFP is principally known for its support of tax limitation measures, such as Michigan’s Proposal 5 this year. The website and mailers, though, extend beyond Prop 5 to offering voters guidance on all six ballot proposals. Still, Proposal 5 gets the starring role.

Questionable statements: “Snyder signs gas tax hike into law; Tax hike passes 20-19, gives Michigan highest taxes on gasoline in the nation.”

“Proposal 5 passes, gas tax hike doubtful. Lower gas prices on the way for Mich. drivers?”

These statements are made in the form of headlines on two different versions of a front page of a fake newspaper, the “Capitol Journal.” This use of fake media formats to fake out voters also has cropped up elsewhere in the ads backing Proposal 5. The contrast is made to convince voters that without Proposal 5, Michigan will have the highest gasoline taxes in the nation.

These fake headlines do not conform with any story out of Lansing this year. In October 2011, Gov. Rick Snyder did issue a special message on transportation, which included ideas for revamping how Michigan taxes fuel. Legislation was drafted, but it’s gone nowhere at the State Capitol.

The Tax Foundation, using data from the American Petroleum Institute, said Michigan started 2012 as No. 5 among the states in fuel taxes.

By October, however, a state of Nebraska document citing API data had moved Michigan to No. 6, showing the volatility of such rankings.

As for “lower gas prices,” the federal Energy Information Administration projects gas prices in 2013 to trend downward slightly – a projection made on Oct. 10.

Questionable statement: “John Anthony Smith. Born August 18, at 7:58 a.m. 8 pounds, 15 oz. $51,585 in debt. Michigan politicians have a spending problem. Michigan government spending has increased by 376% since 1960, while its population and our standard of living fell- from 9th in the nation in per capita income, down to 36th.”

This is a variant of a previous pro-Prop 5 claim vetted by Truth Squad.

As that review stated, the $51,585 figure “is a reference to the total U.S. debt of more than $16 trillion, which breaks down to more than $51,000 per citizen. The ad fails to note there is no direct connection between national debt and state taxation, the focus of Proposal 5.”

That analysis further reported:

“According to Michigan’s Department of Technology, Management and Budget, Michigan’s gross budget in 1960 was $1.1 billion, compared to $49 billion for 2013. Adjusted for inflation, that is an increase of  about 570 percent, a rise budget officials attribute to the addition of programs like Medicaid, rising health care, welfare and prison costs and infrastructure expenses such as roads, information technology and building construction. But for all that, Michigan ranks about in the middle among states in taxation. According to the Tax Foundation, a Washington D.C.-based tax research group, Michigan ranked No. 22 in per capita state collections in 2010.

According to the U.S. Census, Michigan per capita income was $1,940 in 1959, which would equate to about $14,000 in 2010. <State per capita income in 2010 was about $35,000, which represents an increase of about 250 percent over 1960. Population grew from about 7.8 million in 1960 to 9.9 million in 2010, an increase of 26 percent.

“The Tax Foundation rated Michigan No. 29 nationally for state and local tax burden per capita in fiscal 2009. For that same year, the Tax Foundation said that 9.7 percent of state income went to state and local tax burden, placing Michigan No. 21.”

According to historical data collected here, Michigan was 10th in per capita income in 1960 and 36th in 2010. Much of the decline in rankings occurred in the last decade due heavily to the contraction in the automotive industry, both in employment and in wage rates.

Questionable statement: “This year, they plan to raise taxes on gasoline by a billion dollars, which will give Michigan the highest tax on gasoline in the nation.”

Snyder’s special message outlined a shift in fuel taxes that would be “revenue neutral.” However, an example he used of increasing the state registration fee by “an additional $10 per month on the average passenger vehicle would raise nearly $1 billion. In addition, a local or regional registration fee of $40 per year on the average vehicle would raise nearly $300 million.”

As for highest in nation, the ad offers no source. As noted above, fuel taxation in the states can change so even if Michigan were to enact a change, there’s no guarantee how the state would rank at that given moment.

Overall impression: This is not your disinterested voter’s guide to navigating a large and complex crop of ballot proposals.

Foul or no foul: Flagrant foul. Backers of Proposal 5 appear quite fond of the fake news report, to their discredit.

The Center for Michigan (the parent company of Bridge Magazine and the Michigan Truth Squad) has been financially supported by a wide range of corporate and foundation supporters. We are grateful to all funders for helping us create and grow a new nonprofit journalism service for Michigan citizens. Those funders have absolutely no role in the editorial decisions of the Michigan Truth Squad or Bridge Magazine.

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