THE NEW GILDED AGE (Part 2)
THE NEW GILDED AGE (Part 2)
19th October, 2006 0
Who wants to be a millionaire?
Maybe the candidate who wants to become Michigan's next state senator for Saginaw & Gratiot counties will have to be a millionaire - not necessarily in personal wealth, but at least in the campaign money they raise.
"This particular race is considered one of the most expensive, if not the most expensive state senate race in Michigan," says Dr. Roger Kahn, the Republican candidate to succeed the GOP's term-limited Mike Goschka in the 32nd District.
"The number that's being tossed out for this race is a million dollars a side," Khan says. Democrat Carl Williams declines to speculate on dollars, but he rejoins, "That's Roger Kahn talking. I'm going to raise as much as I can to do what I need to do to win."
To which Kahn chimes, "I hope I raise enough to win.
So at least they agree on something.
In campaign finance statements after the August primary, Kahn reported raising $271,425 despite facing no foes for the Republican nomination. Williams reported $66,118 in the bank, even though he had to face a pair of Democratic primary opponents.
Advantage Kahn? Totals for both have increased since then, as anyone following the television blitz will attest. The next reporting deadline is a few days before the Nov. 7 general election. Spending will include not only the personal funds the candidates raise, but ads (including attack ads) subsidized by special interests on both sides.
"It's expensive," says Kahn. "because of media costs with the size of a district covering two entire counties. Also, the district is evenly divided Democrat & Republican - possibly slightly more Democratic, and so it may be more expensive on my side."
In fact, the past winners going back to the 1990s were the GOP's Jon Cisky and then Goschka. Democrat Jerry Hart, long deceased, held control during the 1970s and 1980s before term limits, and before new district boundaries tacked Gratiot County onto Saginaw County.
Williams served from 1991 to 2000 on the Saginaw City Council and then became mid-Michigan's first African American state representative. He is seeking to establish similar inroads in the State Senate and started Gratiot County outreach early last year, with emphasis on such issues as environmental cleanup & alternative fuels. He insists he is ready for the potential challenge of a bigger-spending opponent.
"When I decided to run for this seat, I developed a plan, a strategy," Williams says. "That is the only thing I look at. It was the same thing in the primary. I don't look at my opponents. I look at my plan."
Meanwhile, Kahn says he doesn't look at his list of financial donors. He won a Saginaw County Board of Commissioners seat in 2002 with record local spending of $60,000, and advanced two years later to the state House.
"I'm not really a buyable kind of guy," Kahn says. "I do talk to PACs and listen to their concerns. I answer questionnaires and accept endorsements. But in terms of money contributions, I never look at them. Those go to a completely different group of people, and I make sure they can tell me what we're doing is honest and above board, and that we follow the law."
"I need money to run the race, but I don't look at it from the point of view that 'Joe Schmoe' or 'Business X, Y, Z,' is giving me a bunch of money, and therefore I have to vote their way. Separation between money-raising and the candidate is important."
Reports indicate that Dick DeVos, Republican challenger to Democratic Gov. Jennifer Granholm, will spend up to $25 million in personal wealth from Amway and other enterprises. DeVos has run television spots promising to fight special interests and would propose a law banning campaign contributions from lobbyists. Kahn says he would support a law "as long as we create a level playing field." His preliminary finance reports indicate that unlike DeVos, he has relied mostly on outside contributions rather than personal finances.
"Will this Senate campaign get that expensive?" Kahn asked. "I don't know. But $1 million per side, that's a very frightening number in my opinion."
Williams, in turn, scoffs at the DeVos proposal. "If a man who has spent $25 million of his own money on his campaign wants to invoke a state law," says Williams, "that's a statement in itself."
Both candidates insist they want to focus on issues rather than campaign spending. Review Magazine won't reap a penny on a thousand dollars on those ads, much less a penny on a dollar. But the mission here remains to inform the public.
In that spirit, what follows is an in-depth survey of the so-called 'real issues'. If you would like to hear more 'personally' from Dr. Kahn and Mr. Williams, call the TV stations that are getting all the campaign bucks and ask what they're going to do. Maybe one of them would donate a commercial free hour (or even a half-hour) for a candidate forum, in exchange for all the revenue from generally misleading attack ads?
Review: Please list and explain three top priorities?
Kahn: The top priority is jobs and our economy. A number of other issues are important to me - health care, of course, because of my background, and public safety and education.
We're looking here in Michigan at an economy that is the worst in the country. In July, Michigan lost 28,000 jobs. The second-worst state was Kentucky, which lost 5,000 jobs. When we think of outsourcing, it isn't just to India; it's to Illinois, which in July was the state with the most new jobs. We know places like Mexico have no environmental laws, no child labor laws, and they put people to work for a dollar an hour or less. But we have to deal with that. We also have to compete with our neighboring states, like Illinois.
Health care in Michigan is broken. For the first time this year Michigan is spending more on health care, $13 billion than on education. Health care has become a jobs issue. General Motors spends $1,500 per vehicle on health care for employees. At Nissan or Toyota, they have nationalized health care and the companies spend almost nothing.
Crime has also become a jobs issue, in terms of what we are going to do about gang crime, how we're going to make people feel safe in their homes, or when they come downtown for shopping or public events.
In education, we have always prided ourselves with our millages supporting our kids with Proposal A (in 1994) to balance the funding. Education is another jobs issue.
Williams: Actually, I have four top priorities. They are jobs, health care, education, and public safety.
The status of jobs in this district is declining, and we have to be able to come up with some solutions in terms of finding new jobs, keeping the jobs we have now, and taking care of those who have lost jobs.
With health care, we have to put our arms around the whole issue of costs for businesses, in particular small businesses. Health care cost is probably the number one issue for businesses. But at the same time, we have to find solutions for those who do not have access to health care.
For education, on the front end we have to prepare our children for the future, starting not in kindergarten or in preschool, but at birth. On the back end, we must partner with our community colleges and our universities so that we can prepare our workforce for the jobs that the future will demand.
If we do not have public safety, then our planning for the concerns listed above and for all other concerns won't make any difference. It can't happen without public safety.
Review: Could you elaborate on how you would promote job creation?
Williams: One of the first things I'm going to do is hold public hearings, along with votes in the Legislatu re, for the state to stop rewarding companies that send jobs overseas.
We also have to look at emergency assistance for those who have had their jobs outsourced already. This assistance must make sure that they keep their homes, that they keep their cars, and that they still have resources to send their kids to college. (Editor's Note: Who's going to pay for all this 'assistance'?) I'm also going to work at increasing the state's Merit Scholarship fund, and at the same time provide interest-free loans for students who commit themselves to stay in Michigan, and to work in Michigan once they graduate.
Kahn: Any candidate will tell you jobs and the economy are important, but how do we create these jobs, and what is the playing field?
The Single Business Tax penalizes new businesses that usually are undercapitalized and start with low profits. It penalizes companies that provide health insurance for their workers because they are taxed on those benefits. It penalizes businesses that are losing money, such as Delphi. It has been a bad tax because it hurts the same types of companies that we should be trying to support.
That's not the only thing that's wrong. We need to look at the three R's - rules, regulations and red tape. Businesses that may consider locating in Michigan face an almost insurmountable task to work through the permitting process. Other states have booklets prepared by their DEQ offices that tell what permits they need, the process to get those permits, and the time frame. Here in Michigan we ought to have something like that. That's a no-brainer.
Thirdly, when you look at our area, where do have something that shines? Hemlock Semiconductor created new and jobs and is thinking of expanding even more. But the cost of energy in Michigan is about 1.3 times what similar amounts would cost if Hemlock Semiconductor located in Kentucky. This is also part of the difficulty for Delphi and Dow Chemical.
A fourth issue is that no other state has had anything similar to our Single Business Tax. This has forced a company coming to Michigan to generate a whole new accounting system, along with the costs associated with that.
Review: How should state government restore $1.9 billion in revenue to replace the Single Business Tax?
Kahn: The idea of a business tax isn't wrong. If a business makes a profit, it should pay a tax. Our problem with our SBT is that it's taxing the wrong people - the companies that create jobs and the companies trying to recover.
The tax should be on business profits and it should replace the SBT dollar-for-dollar through folks who make a profit, like the tax laws in the other 49 states. If you're making a good profit, you pay a good tax.
In America, for individuals, we have embraced a graduated tax structure based on individuals' ability to pay. We should do the same with business taxes.
Williams: You're looking at two interests - the business interests, and the interests of the broader community such as education, public safety and local government entities.
People in business want a simple tax, a tax sensitive to profits. The broader community interests want to maintain the basic services that they ought to provide. To replace that revenue, we have to figure out how to do it in a way that will satisfy both interests. On the bottom line, we can't have that $1.9 billion budget hole balanced on the backs of those who can least afford it. To balance that budget hole before the Republicans revoked the Single Business Tax - that would have been the most responsible approach. It shouldn't have been done in the manner that it was done. That was like a family spending its grocery money for the kids and saying, 'We'll get around to replacing the grocery money next week.' It made no sense.
Review: How will you vote on Proposal 5, which would promise inflation-adjusted annual K-16 funds for public schools and colleges through a state constitutional mandate?
Kahn: I will vote no on Proposal 5, the same as the Governor, the same as Dick DeVos, the same as most of the folks who are involved in government.
We have a model for what the people feel about these kinds of issues. The same sort of state funding carve-out was proposed four or five years ago for my industry, the health care industry. That was voted down because if you carve out a lion's share of available dollars for a certain purpose, that means the ability to support dollars for other purposes - to have revenue sharing, to support the Michigan Economic Development Corp., to have direct grants to health care and Medicaid - all of that will be threatened. We don't want to tie the hands of people in government in terms of setting priorities. You elect us to be your representatives, to make choices and hold us accountable for those choices.
Williams: I agree with the sentiments of it, but I will oppose the proposal. My focus has always been more on Birth to 16. As a state representative, I have proposed legislation changing the time frame and the funding stream for K-12 into Birth to 12.
The problem with Proposal 5 would arise in circumstances in which we would not have the funding to comply. If there were to be approval by the voters, you're programming your government to do this no matter what the impact on other programs and services would be that you expect from your government.
It would take away the flexibility that we should have as elected representatives.
Review: Can you offer solutions to the health insurance and Medicaid cost crisis?
Khan: We start as a society. What do we believe in? I believe a civilized society does feel a responsibility to take care of the health of its people. And we do that. But we do this with a price. The single No. 1 cause of bankruptcies in this country is health care costs.
We have a mish-mashed system based on the notion of cost shifting. The cost is shifted from industry, from a government that underpays, and from hospitals that basically have no insurance.
To address the issue of cost shifting, the Massachusetts plan under Gov. Mitt Romney divides us up into three sorts of groups. The first group is states that have under applied for the federal portion of Medicaid. The second group is the working poor. The third is people grouped either by employer coverage or on a personal basis.
I want to deal especially with the working poor group. As a County Commissioner here in Saginaw, I came up with the Saginaw Health Plan. I was able to get that through, even though I was serving on a Democratic County Commission as a Republican, because the idea had merit. I would like to take that same concept to Michigan's Senate in an expanded version.
This plan isn't unique and I don't have all the answers. But if we slow down the cost shifting, then the total cost will go down instead of being shifted to the Blue Crosses and Medicaid. We have to improve our application process. In fact, people who can pay should pay. It's sort of like no-fault insurance, I suppose.
Williams: I have consistently supported efforts to reduce the costs of health care and to increase the access to health care.
I want to mainly talk about an area that has especially concerned me, which is the cost of prescription drugs. When I started as a state representative six years ago, I initiated a program in cooperation with the Black Nurses Association to help provide prescriptions for those people with no insurance. We still have this program, but we need to do more.
Six years later, many people are still facing the same choice. Do I stock up on food and fall short on my prescriptions?
Governor Granholm has brought forth some good initiatives. Bulk buying of prescription drugs can give people the option of buying medicines at a cheaper rate. Also, we need to exercise the option of buying prescription drugs from Canada. These drugs may be manufactured in the U.S. but they wind up being cheaper in Canada, which is unfortunate.
We also need to do something about pharmaceutical companies in Michigan that receive complete immunity if they manufacture a drug that harms or kills people. We are the only state that allows that.
Review: How will you vote on Proposal 2, which would ban affirmative action's alleged 'preferential treatment' in college admissions and scholarships, and in state and local government employment & contracts?
Kahn: I will vote not. This proposal it ill thought. It appears to penalize women and minorities.
Williams: I will vote against it. Taking away affirmative action will harm deserved opportunities for African Americans, people with disabilities, and Native Americans.
Also it's hypocritical to me to say affirmative action is wrong, even when the legacy of the past allows applicants to schools such as Harvard and Yale to gain points because of the wealth and status of their ancestors.
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THE NEW GILDED AGE (Part 2)