Situation screwed

After Gov. Jennifer Granholm described the state's $3 billion budget deficit to a group of newspaper executives last week, the mainstream media characterized the situation as a "fiscal crisis" that's putting Michigan at a "critical crossroads."

We're hoping the governor has presented some brilliant, painless solutions in her state of the state address by the time you're reading this. But at News Hits, we're not crossing our collective fingers.

Detailing the state's $3 billion budget shortfall for this fiscal year and next, Granholm spoke at the Michigan Press Association legislative luncheon Friday in Grand Rapids. She promised to propose some solutions in her address Tuesday.

But last week, she was doing prep work for the next several months of bitter budget debates.

"We all care about how we are going to move forward," she told the audience of media executives, reporters, student journalists and legislators attending the annual convention. "We want citizens to believe in our state and our future. To the extent that we can be partners in building up rather than tearing down, that would be the greatest gift ever."

Her efforts to rally the editorial writers and the bipartisan audience were commendable. But as we mull over the possibilities in our pre-state of the state speech deadline, we realize it's not going to be pretty.

The $3 billion needs to come from somewhere, either in cuts to health and social services, reductions in funds to higher education or downsizing our prisons — or an increase in revenues. In realspeak, that's tax increases. Frankly, with a deficit this size, the likelihood is that Granholm's going to propose both spending cuts and tax hikes.

With a dismal state economy, a decreasing market share for the Big Three, the elimination of the Single Business Tax, increases in Medicaid and human services needs, and the lowest level of state employment in 30 years, where else can we go? The governor had a nice PowerPoint presentation showing what she calls "spending pressures."

"We've got a challenged economy and that means less revenue," she says.

None of the pie charts, spreadsheets and economic forecasts say boo about what this does to the collective Michigan mood, but Granholm at least filled that gap.

"This has a direct impact obviously on the revenues of the state but also the overall psyche of Michigan," Granholm says.

So while the newspaper editors and publishers who heard the governor last week are writing about the merits of tax cuts to stimulate the economy or the need to ensure social services for the most vulnerable, the debates will grow louder in Lansing.

In the alternative press, we're allowed to translate that to "We're fucked."