When U.S. Treasury Secretary Janet Yellen spoke to the audience at the Feb. 14 Detroit Economic Club meeting, she was extolling the virtues of legislation passed under President Joe Biden that she believed “positioned Michigan” to benefit.
Yellen cited the CHIPS Act, the Inflation Reduction Act and American Rescue Plan — which allotted $6.5 billion to Michigan — as key factors in “lowering health care costs for American families, supporting small businesses, and creating economic opportunity across the country.”
“I see Michigan as a state positioned to benefit from that legislation,” Yellen told the audience.
Michigan Gov. Gretchen Whitmer, who was making a joint appearance with Yellen and was responding to a question from the secretary, pointed out that Michigan did, in fact, benefit from the federal assistance contained in that legislation.
She pointed to:
- Investment in high-speed internet, where Whitmer said her state is fourth in the nation in investment in high-speed internet.
“We saw during the pandemic how crucial that was,” she said.
- Approvals of “big battery projects” for electric vehicles she said are “so important to the Michigan economy” amid a shifting landscape of automobile production.
“We’re so grateful for the incredible investment from the federal level,” Whitmer told Yellen. “Implementation is the name of the game; we’re making sure we are moving swiftly. We’ve been able to secure incredible resources (and) we’re already seeing these resources coming in.”
During her talk, Whitmer also touted Michigan’s manufacturing economy, including a plan – unveiled in the $80 billion budget she revealed earlier this month – to put incentivize Michigan employers to “invest in their workers.”
The budget includes spending some $60 million for the Michigan Innovation Fund, the state’s startup investment program, to boost economic growth. “These are all strategic ways I think that we can ensure that manufacturing is really growing and continues to do so,” she said.
She called for fiscal responsibility and pointed out ways her budget accomplishes that, including building the state’s fund balance – the so-called “rainy day” fund – to some $2.2 billiln by the end of 2025, and adding another $500 million to a second such fund for schools.
In terms of economic development, in addition to the innovation fund, Whitmer said the state has landed billions of dollars in investment and thousands of jobs.
In her State of the State address, she proposed:
- The Innovation Fund to invest in high-growth startups.
- A tax credit to spur research and development.
- “Hire Michigan” fund to lower payroll taxes. “The more you hire in Michigan the more you should be able to save in Michigan,” Whitmer said.
“These tools would supercharge our economic growth,” Whitmer said. “These should be bipartisan efforts … and will help every one of us in the work we’re doing.”
Whitmer’s budget recommendation, which she called “fiscally responsible,” totals $80.7 billion, including a general fund total of $14.3 billion and a school aid budget totaling $19 billion. It provides a significant amount of one-time funding while maintaining balance in future years and utilizes one-time funds for one-time purposes. It also continues paying down debt obligations, freeing up future funding for programs ahead of schedule, like free preschool.
“(The budget) builds on the historic investments we’ve made since I took office and delivers on the issues that make a real difference in people’s lives,” Whitmer said. “Together, let’s lower costs for working families, deliver the Michigan Guarantee to offer every Michigan child a free public education from pre-K through community college, save family caregivers thousands on their taxes, and power our economic and workforce development to build and lead the future. Let’s get it done so everyone can ‘make it’ in Michigan.”
