2010 economy and stark choices

MLive columnist and capitol reporter Peter Luke provided an insightful, albeit depressing, column Sunday about the stark budget realities the state of Michigan will face in 2010.

Luke outlines the crisis as it brewed this past decade, thusly:

It took a decade to lose close to a million jobs. It will take at least a quarter-century to get them all back.
Two statistics in the agency’s report illustrate why the decade was about as bad as it could get.

U.S. car sales that surpassed 17 million in 1999 plunged to about 10 million this year, with the Detroit Three’s market share dropping from 65 to 45 percent.

Personal income — right at the national average in 1999 — plummeted to only 86 percent of the national average in 2009.

And what does Luke say that translates to in terms of budget issues:

Another huge hole must be dealt with because tax receipts and spending for health care, public safety and education don’t match up. This fresh gap results from the loss of federal stimulus funding that in the current fiscal year provided $1.5 billion.
Congress may well step in with another bailout. But there are only three other options to keep Michigan solvent: cut spending by 20 percent, raise taxes on the order of the 2007 hike in income tax, or a combination.

Luke goes on to outline a desperate picture facing public universities, which were spared the budget ax this year because of stimulus money strings, prisons and Medicaid. Basically the 2010-2011 budget year battle will make anything we have seen thus far look like a walk in the park on a beautiful spring day. Get ready for the storm of the century, political grand standing and cutting the budget bones with possible amputations of essential government services. All of this will be informed and poisoned by, a brewing governor’s race, battle by the Dems to retain control of the House and the war to wrest control of the Senate from the GOP.