89.1 WEMU

Report Says Michigan's Government Short On Savings

Nov 20, 2017

Pile of Money
Credit Wikipedia Media Commons / wikipedia.org

A downturn in the economy would quickly drain the state’s “rainy day” savings.  That’s the determination of an independent analysis.


Michigan’s “rainy day” fund can help the state weather a recession without deep cuts or tax hikes.  But that requires lawmakers to deposit generously when times are good.  

Craig Theil is with the non-partisan Citizens Research Council.  He says lawmakers tend to focus on boosting funding for services or cutting taxes when there’s a revenue windfall.

“During an improving economy, there’s this third option, which is putting money away for the rainy day.” 

There is currently about $700 million in the fund, which zeroed out during the last recession.

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— Rick Pluta is the Managing Editor and Reporter for the Michigan Public Radio network.  Contact WEMU News at 734.487.3363 or email us at studio@wemu.org