Ballard on the Michigan economy
MSU economics professor Charles Ballard just gave a terrific presentation on the Michigan economy. Highly recommended!
Ballard’s main themes are:
- Michigan’s population decline has followed its economic decline
- Michigan has moved from being a high to low prosperity state
- The main causes of the decline are both the decline in manufacturing employment and Michigan’s standing as a low college attainment state in an economy where the premium for a college degree is rising
- Michigan policies have contributed to that decline by favoring tax cuts at the expense of higher education funding. Ballard writes: “At a time when education is so crucial to our future, Michigan has pursued a policy of systematic disinvestment in education.”
- The long run decline in Michigan has been accompanied by growing income inequality particularly for men without college degrees and African Americans.
The slide above, from Ballard’s presentation, clearly depicts the Michigan decline. In the Industrial Age (through the 1970s) when manufacturing matter most, Michigan was at least as prosperous as Massachusetts. But in an economy that is over the past three decades or more increasingly knowledge based, Massachusetts has soared while Michigan declined sharply. The main reason: Massachusetts is first in college attainment, Michigan is 35th.