Prop 5′s Scheme

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The Prop 5 (“Two-Thirds” Ballot) Scheme

Proposal 5 is almost entirely funded by a lone Detroit billionaire, Matty Moroun. He spent nearly $2.3 million to buy enough signatures of Michigan voters to put the proposal on the Nov. 6 ballot.

It is backed by a prominent and controversial Washington, D.C. lobbyist named Grover Norquist, and a handful of extreme supporters based in Michigan.

This plot is to buy a constitutional amendment that would protect tax policies that benefit billionaire Moroun and other special interests at the expense of Michigan’s future prosperity and local taxpayers.

Here is how it would work:

  • Even if 135 members of the Legislature voted in favor of closing a tax loophole, ending a special interest tax break, creating a tax or raising a tax,
  • Just 13 senators could vote against it … and block it.

Imagine the power lobbyists and special interests (like a single billionaire) would have if just 13 legislators could block a policy supported by the other 135 members of the House and Senate.

How hard do you think it would be for a billionaire to control the votes of just 13 state senators?

“Super-majority” really means lobbyists and special interests would rule our Legislature on tax policies.

That would mean partisan gridlock in Lansing, higher local taxes, and more cuts to education, health care, public safety and other essential services.

Experiences in super-minority states

Most state legislatures can send tax bills to the governor with a simple majority vote in each house, the same margin required to enact most other bills.  Most states allow a tax measure to pass with a simple majority in each house of the legislature, including Michigan since it became a state 175 years ago.

Only a handful of states have super-minority requirements, and they tend to be poor, or have struggling economies and ongoing state budget crises.

  • One of the states (Nevada) has the nation’s highest unemployment rate.
  • One of the states (Mississippi) is the poorest state in terms of per capita income.
  • One of the states (California) failed to meet its constitutional deadline for balancing the state budget 16 out of 20 years because of legislative gridlock.
  • Of the 10 states with some form of super-minority requirements, seven have unemployment rates above the national average; seven have per capita incomes below the national average.

If this was the path to prosperity, these states would be among the leaders in per capita income and employment. They are not. There is good reason to believe the two-thirds proposal, giving superpowers to a handful of lawmakers, is preventing these states from providing the economic climate through tax and spending reforms and investment that employers and young talent want, in order to create the good paying jobs for their citizens.

Some other facts about the “super-majority” states:

  • California is the poster child of dysfunctional government: Under their two-thirds requirement, the Legislature missed the legal deadline for passing a state budget in 16 of the 20 years prior to 2009.
    • Read more in this March 2009 Los Angeles Times editorial. The editorial also states the two-thirds requirement is “why gridlock so often seems to rule the day in Sacramento.”
    • California this year had to make massive cuts (yet again) to close a $15.7 billion deficit in its 2012-2013 state budget.
    • Three California cities (Mammoth Lakes, San Bernadino and Stockton) have filed Chapter 11 bankruptcy just this summer. San Bernadino and Stockton are the largest cities in the country to ever file for bankruptcy.
  • When state legislatures are unable to generate tax revenues to cover the costs of essential services, those costs are shifted to others including local taxpayers (higher property taxes).
  • States with “super-majority” requirements tend to have worse credit ratings, which costs taxpayers millions more to finance bonds for roads, bridges, schools and other capital projects.
  • Taxes in states with “super-majority” requirements are not lower than in states with majority-rule democracies.
  •  Lobbyists and special interests gain even more clout. They have no trouble protecting tax breaks and loopholes that often benefit only a handful of corporations or individuals.