economy

Politics
5:31 pm
Tue March 1, 2011

Snyder defends budget and tax plans

Rick Snyder campaigns last year. Now, Governor Rick Snyder is having to campaign for his budget proposals.
Bill Rice Flickr

Governor Rick Snyder is defending some of his controversial budget plans.

He says taxing pensions is the right thing to do, even though some Republican lawmakers say they will not support that plan.

And Governor Snyder says his proposal to cut funding for universities by 15% this year is necessary, but he says it will get better for the schools in the future:

"We shouldn't have to walk away from our universities. Again, I'm a big, long-term advocate of we need more students going through our universities. Higher Ed is very important in our state, actually we're a very fortunate state in having the high-quality institutions that we have.

We have a tough budget situation and we need to deal with that, but if you look forward to 2013 we’re able to show that hopefully this is the bottom point in terms of where we go with higher education funding."

Snyder also told building-trade union members that he wants to work with unions to help balance the budget, not against them.

He says he is not interested in Republican proposals in the Legislature to strip unions of their power.

Arts/Culture
5:03 pm
Tue March 1, 2011

Detroit to host "Rust Belt to Artist Belt" conference in April

The "Rust Belt to Artist Belt" conference will be held April 6-7 in Detroit
Dani Davis

Creative types from across the country will convene in Detroit next month to talk about how artists can help revitalize post-industrial cities.

Matt Clayson directs the Detroit Creative Corridor Center and is one of the people behind the “Rust Belt to Artist Belt” conference.

He says the conference will focus on the creative supply chain many post-industrial cities like Detroit have to offer:

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Auto/Economy
4:37 pm
Tue March 1, 2011

Consumer Reports calls Chevy Volt a "tough sell"

Consumer Reports says the Volt doesn't make sense for the price.
user mariodo creative commons

In its April auto issue, the magazine Consumer Reports calls the Chevy Volt is a "tough sell."

It's not the kind of review GM has been accustomed to after the car was released with much fanfare.

The Volt was named "Car of the Year" at the Detroit Auto Show.

The Detroit News says that harsh review from Consumer Reports questions whether the car makes "economic sense."

David Champion, the senior director of Consumer Report auto testing center said:

"When you are looking at purely dollars and cents, it doesn't really make a lot of sense. The Volt isn't particularly efficient as an electric vehicle and it's not particularly good as a gas vehicle either in terms of fuel economy. This is going to be a tough sell to the average consumer."

The car costs around $40,000, but with a government tax credit (a credit some lawmakers want to turn into a rebate) the cost comes down to around $33,500.

The criticism came from the car's range in cold weather. The Volt's electric motor range is 40 miles under normal driving conditions, but that range dropped significantly when Consumer Reports tested the car in Connecticut this winter - the range dropped to 25 to 27 miles on electric power alone.

A GM spokesman said his range was better in cold weather. Again, from the Detroit News article:

GM spokesman Greg Martin noted that it's been an extremely harsh winter — and as a Volt driver he said he's getting 29-33 miles on electric range. But he noted that in more moderate recent weather, the range jumped to 40 miles on electric range or higher.

Other criticisms of the Volt were its 5-hour charging time, and a heating system that leaves your hands and feet cold.

The magazine gave the Volt praise for its acceleration and for its "taut yet supple ride."

USA Today reports that in the April auto issue, Consumer Reports gives foreign automakers Honda and Subaru top honors with Ford positing the "largest gain" in rankings overall.

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Arts/Culture
12:28 pm
Fri February 25, 2011

Borders No. 1, where it all began in Ann Arbor

Borders Books has filed for bankruptcy. One former employee remembers the first store in Ann Arbor.
Steve Carmody Michigan Radio

Borders Books started in Ann Arbor as a small independent book store.

Tom and Louis Borders opened it in Ann Arbor, Michigan in 1971.

The first Borders bookstore was located at 209 State Street, north of the State Theater.

Eve Silberman was a graduate student in Ann Arbor when she got a job at the very first Borders Bookstore owned by the Borders brothers.

The company recently declared bankruptcy.

Silberman sat down to talk with public radio host Dick Gordon of The Story.

Silberman talked with Gordon about her memories of working at the first Borders bookstore (she described herself as "not a very good worker").

She recalled several things about the first Borders Bookstore:

  • Joe Gable was the "shaper and caretaker" of the store (many thought Gable was a Borders).
  • Gable saw the store as a "cathedral of books" and the workers were the "worshippers."
  • Classical music played in the store.
  • Potential employees had to take a test to get a job at the store.
  • The store carried unique titles.
  • The store's cash register was complex at the time.

Host Dick Gordon asked Silberman about the sense in Ann Arbor about the misfortunes of Borders.

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Economy
11:58 am
Thu February 24, 2011

Pure Michigan funding bill on the way to governor's desk

Thinking of summer days along the Lake Michigan shoreline
(photo by Steve Carmody/Michigan Radio)

A bill that would fund the Pure Michigan ad campaign for the entire year will soon be on its way to Governor Rick Snyder for his signature. The Legislature has approved the additional dollars to keep the campaign on airwaves through the busy tourism months. 

Republican state Senator Geoff Hansen says the funding had to be approved this week before ad-buy costs go up. 

"It was more important that we got it done right now because every day that we delay this means that we’re going to have that less of a chance to buy the ads that we need. We can buy more now than we can in a week, so it was just so important to get it done.”  

The state will tap a venture capital fund to pay for the ads for the balance of this year. Hansen says lawmakers still need to find a permanent funding source for the Pure Michigan ad campaign. But he does not think they will deal with that issue until next year.

Economy
10:46 am
Thu February 24, 2011

Why don't YOU fix the state's budget woes?

The Center for Michigan wants you to play their game.
Image from the Center for Michigan's website

Try your hand at fixing the state's budget problems.

The Center for Michigan has released an interactive state budget calculator - YOU Fix the Budget.

The idea is similar to the New York Times interactive budget calculator for the federal government.

You can start by adding $1.2 billion to the state's budget woes by cutting business taxes, or you can leave business taxes alone and deal with the current budget hole the Center estimates at $1.4 billion.

Once you start, your options are to cut, cut, cut (cuts to education, cuts general government, cuts to prison and police, cuts to the public workforce, and cuts to welfare and health care) - or - you could raise taxes.

So far, of the 300 or so people who have participated - raising the Beer Tax is the most popular option.

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Politics
3:33 pm
Wed February 23, 2011

Governor Snyder talks cuts on public radio call-in program

Then candidate Rick Snyder at the Michigan Republican State Convention in 2010.
Bill Rice Flickr

Governor Rick Snyder was interviewed this afternoon by NPR's Talk of the Nation.

He was asked questions by the hosts and by listeners. You can listen to the entire interview here:

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Economy
9:57 am
Wed February 23, 2011

Rising gas prices & Michigan's economy

A Comerica Bank economist says rising gasoline prices shouldn’t hurt Michigan’s economic progress…too much. Unrest in the Middle East is forcing global crude oil prices to rise, which is pushing up gas prices in Michigan and elsewhere.    

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Arts/Culture
5:13 pm
Thu February 17, 2011

Detroit's MOCAD, Heidelberg receive grants for community arts projects

The Heidelberg Project received a $50,000 from LINC
Photo courtesy of the Heidelberg Project via Facebook

Two Detroit arts organizations are one step closer to turning their artistic visions into reality.

Leveraging Investments in Creativity (LINC), a national arts organization, awarded $50,000 to the Heidelberg Project in Detroit, and $100,000 to the Museum of Contemporary Art Detroit (MOCAD).

Heidelberg will use the money to build an outdoor public art project on Detroit’s east side. MOCAD will use the money to create an outdoor space for art and community engagement.

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Arts/Culture
2:33 pm
Thu February 17, 2011

Artpod: Cost of Creativity, part 3

The Cost of Creativity looks at arts and the economy in Michigan
Dani Davis

We put together our stories about arts and the economy in the state to create an hour-long documentary called The Cost of Creativity. On today's podcast, we'll hear the final installment of the doc.

And because Artpod is about all things Michigan, all the music you'll hear on The Cost of Creativity is by Michigan artists. The musicians featured on today's podcast and Luke Winslow-King and Ben Benjamin.

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Changing Gears
4:55 pm
Wed February 16, 2011

Live Panel Discussion: "Don't Go! What will keep you here?"

What will keep future entrepreneurs from leaving the state?
Alex Proimos Flickr

Keeping the brains here at home.

The University of Michigan Ross School of Business and the Changing Gears project are partnering on a panel discussion about "brain drain" being held at 5 p.m.

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Politics
4:43 pm
Tue February 15, 2011

Another step toward eliminating the item pricing law

The item pricing law gives retailers indigestion.
Shawn Campbell Flickr

Update 4:23 p.m.:

Rick Pluta, from the Michigan Public Radio Network, says the House will likely vote on a repeal of the Item Pricing Law tomorrow. Pluta spoke with the sponsor of the bill, State Rep. Lisa Lyons. She says individual price tags wouldn't be required, but stores would be required to prominently post prices so consumers know how much things cost:

"It does eliminate the antiquated requirement that every item be priced which has been in effect since before I was born, but it also upholds and provides for consumer protections that Michigan shoppers have come to know, expect and they deserve," said Lyons.

2:06 p.m.

The Michigan legislature is a step closer in repealing the state's Item Pricing Law.

The law requires that most items on store shelves carry an individual price tag.

The Lansing Bureau of the Detroit Free Press reports:

Legislation to rescind the requirement that almost all retail goods sold in Michigan be individually priced cleared its first hurdle in the state House this morning, winning approval in the Commerce Committee on a 16-3 vote. The measure was approved after its sponsors agreed to an amendment that will require retailers to clearly display prices in close proximity to the item for sale.

Governor Syder has said that a repeal of the law will send a signal that Michigan is a business-friendly state. Retailers say the law is antiquated and drives up prices.

Rick Pluta reported for the Michigan Public Radio Network that

The last effort to repeal the law was five years ago, but it failed under the threat of a veto by Governor Jennifer Granholm.

Proponents of the law say the individual price tags protect consumers from being overcharged.

Politics
2:50 pm
Tue February 15, 2011

Flint's financial plan on hold

The weather ball in Flint can't predict the city's economic future.
Jame Fairbrother Flickr

Update 3:50 p.m.:

The city of Flint did not get approval today from the state for a $20 million bond.   The city needs the money to pay its bills.

The state Treasurer’s office asked the State Administrative Board to table the bond request, which it was expected to approve. The Treasurer’s office is concerned that the city doesn’t have a plan to deal with its long-term debt.   

Flint Mayor Dayne Walling is optimistic the city will get some help from the state. 

“I’m confident the city of Flint and the state Treasurer’s office will work together on a short-term, if not a long-term solution here in the next few weeks.”

Flint faces a multi-million dollar budget deficit.   The city has laid off police officers and dozens of other employees and has reached pay cuts with other city unions. But it still might have trouble making payroll in the coming months. 

Update 2:50 p.m.:

The State Administration Board put off a decision on the city's budget plan this morning. The city wants to borrow money in the form of $20 million in bonds to cover its budget deficit.

The Flint Journal has an update from Flint City Councilman Josua Freeman:

By the end of this month or next month, the city will only have about $500,000 in cash on hand, Freeman said. That's not nearly enough money to meet the payroll expenses of $1.5 million to $2 million every two weeks, he added.

"If nothing changes and we don’t improve our cash flow, we're not going to have enough money to operate," Freeman said.

If the city cannot make payroll, a state takeover or Chapter 9 bankruptcy might be next.

12:42 p.m.

The city of Flint wants to issue bonds to cover it's $17 million budget deficit, but state officials have yet to green light that plan.

The State Administration Board was scheduled to vote on that plan today, but it appears plans have changed.

The Flint Journal is reporting the Board voted to remove the city's request from its agenda today. The Journal reports that led to a cancelation of a Flint City Council meeting scheduled for tomorrow:

Tomorrow's City Council meeting to discuss a $20 million bond request from the state has been canceled.

The meeting, which was scheduled for 5:30 p.m. at City Hall, was canceled after The State Administration Board voted to remove the city's request from its meeting agenda this morning...That move came at the request of the state treasurer's office...City Council President Jackie Poplar said she was made aware of the situation and had no comment until she receives further information.

Auto
1:13 pm
Tue February 15, 2011

Chrysler selling "Imported from Detroit" t-shirts

A sample image of the t-shirt from Chrysler's website
collection.chrysler.com

For $29.95 you can continue the buzz that started with the "Imported from Detroit" Super Bowl ad.

Chrysler is selling t-shirts with the "Imported from Detroit" logo on its Chrysler Collection website ('imported' from the USA, according to the website).

The Detroit Free Press asked a Chrysler spokesperson if the design will be on other items:

Chrysler spokeswoman Dianna Gutierrez said, “It’s too early to discuss. I don’t have any formal details to share at this time.”

The epic two-minute ad is still running on television in edited down one-minute and 30 second versions.

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Economy
11:23 am
Tue February 15, 2011

The 2 types of bankruptcy facing Borders

Borders Group Inc. is facing bankruptcy
user brewbooks creative commons

With the impending bankruptcy of Borders Group Inc., we thought we'd give you a quick explanation of the two types of options facing the company.

Chapter 7 Bankruptcy

Also known as "liquidation" or "straight bankruptcy." It sparks an 'everything must go' sale of the company's assets. The company may cease operations after filing Chapter 7 bankruptcy.

The company that owes the money files for Chapter 7 bankruptcy in court. The company's assets are turned over to a bankruptcy trustee who then sells the assets and tries to pay back the company's creditors. In exchange, the company that owes the money is freed from having to pay all of its bills in full (unless some wrongdoing is found).

The details of Chapter 7 rules vary from state to state.

Chapter 11 Bankruptcy

Also known as "reorganization" bankruptcy used by many corporations (like K-Mart and General Motors).

After filing for Chapter 11 bankruptcy, the company that owes money typically keeps running its business and keeps its assets while going through a reorganization process overseen by the court.

A reorganization plan is put forth, and if the majority of creditors accept it, and the court accepts the plan - the company continues operating and repays its creditors under the reorganization plan.

Payment to creditors can come from the sale of assets, repayment from future profits, or from mergers or recapitalization.

Politics
5:19 pm
Mon February 14, 2011

Decision day for Flint's finances

Steve Carmody Michigan Radio

By some estimates, the city of Flint is facing a $17 million budget hole.

Flint's Mayor is hoping state officials will allow the city to go to the bond market to overcome the budget deficit.

The State Administrative Board is meeting tomorrow to give a thumbs up or a thumbs down to the city's request.

The Flint Journal reports:

A state board made up of Michigan's top elected officials (or their delegates) is expected on Tuesday to consider the city's application to issue $20 million in bonds, part of Flint Mayor Dayne Walling's budget plan.

The State Administrative Board meeting will take place at 11 a.m. in the Lake Superior Room of the Michigan Library and Historical Center in Lansing. The meetings are open to the public.

Michigan Radio's Steve Carmody reported that without the money, Mayor Walling said the city will have trouble making payroll in March:

“There is nothing more important for our city right now than the bond.   We’ve been carrying a crushing load of past deficits on our shoulders.  And we’ve come to the point where the pooled cash is not there to make payroll throughout the entire month of March without an infusion of cash,” said Mayor Walling.

If state officials do not approve of the bond plan, the state may eventually takeover Flint’s finances.

Coal plants
3:05 pm
Fri February 11, 2011

State issues permit for Holland to expand coal-fired-power plant

Holland is considering replacing one of the units at the James DeYoung power plant.
Holland BPW

The state’s Department of Natural Resources and Environment initially denied the air quality permit. That’s because former Governor Jennifer Granholm said the state must consider whether or not a community really needs more power before issuing a permit. An Ottawa County judge ruled that’s not a good enough reason to deny the permit and ordered the DNRE to review the permit application by this Sunday.

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Investigative
9:43 am
Fri February 11, 2011

Economic gardening? What's that?

Michael Finney - As CEO of the Michigan Economic Development Corporation, he's the state's chief "economic gardener."
Photo courtesy of Inforummichigan.org and Peplin Photographic (larrypeplin.com)

When the Governor gave his State of the State speech, I was standing on the crowded floor of the House of Representatives.  Governor Rick Snyder outlined his plans to get Michigan back to work.  We all listened as he said the Michigan Economic Development Corporation would lead the way.

“The MEDC will recalibrate its efforts and become a better partner with these regional groups to enhance economic gardening, talent enhancement, and support service to companies.”

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Economy
6:11 pm
Thu February 10, 2011

Manufacturers need more skilled workers

Manufacturing jobs are growing, but finding skilled labor can be a challenge (manufacturing t-shirts at American Apparel in LA).
Rich Allosi Flickr

The national economy added 49,000 manufacturing jobs in January. That’s more new jobs than in health care, retail or any other major sector of the economy.

It’s good news for the Midwest, where thousands of manufacturing workers are expected to be hired over the next few years.

The number of students enrolled in manufacturing training and engineering courses is on the rise at two year colleges. But some employers say they still have a hard time finding qualified candidates.

Michigan Radio’s Changing Gears project is looking at the economic future of the Midwest.

Michelle Kanu filed this report from Cleveland:

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Auto/Economy
2:53 pm
Wed February 9, 2011

Big checks coming to GM workers

GM's Headquarters in downtown Detroit. GM's Akerson says he "wants compensation for hourly workers to more closely mirror that of white-collar employees and executives." - Wall Street Journal
Rich Evenhouse creative commons

Profit-sharing checks to GM's 45,000 workers are expected to break a record. The news comes as GM is tallying its profit numbers for 2010. The company will release the amount of the checks soon.

The Wall Street Journal reports:

General Motors Co. is planning to pay its hourly workers in the U.S. at least $3,000 each in profit-sharing payouts, the largest amount ever, after the company's return to profitability in 2010, people familiar with the matter said...The auto maker is trying to tow the line between fiscal prudence and expectations that it will share recent gains with workers as the company heads into labor negotiations with the United Auto Workers.

Other U.S. automakers are also sharing the wealth.

Ford Motor Company paid hourly workers more than $5,000, "more than the company was required to pay under the profit-sharing formula in its contract with the UAW," according to the Wall Street Journal.

And Chrysler gave their workers $750 despite the company's losses in 2010.

The Detroit Free Press reports that the checks are expected to be handed out in the months ahead, and the size of the checks could help the automaker in its negotiation with the United Auto Workers union. From the Freep:

The Detroit Three, which will negotiate new labor contracts with the UAW this year, may be giving higher-than-required payments to autoworkers as part of a strategy to convince the rank and file to keep labor costs flat in return for bigger profit sharing in the future, labor experts previously told the Free Press.

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