On September 26 the author of this blog noticed recently introduced Michigan Economic Growth Authority related legislation that — if adopted — would actually shed more light, as opposed to less, on the work of the Michigan Economic Growth Authority. This came as something of a pleasant surprise.
The amending language mandates that the MEDC report:
· Number of new jobs required to be created or retained;
· Amount of capital investment to be made by MEGA recipients; and
· Number of actual new jobs created and the actual total capital investment made.
In other words, the bill’s author — Nancy Cassis — wants to compare promises made about MEGA performance with promises kept to see if the program is as advertised. Moreover, and perhaps most importantly, her legislation mandates that the Auditor General confirm MEDC claims. In other words, like Toto in the Wizard of Oz, Senator Cassis wants to what is behind the curtain (see photo, left).
For years my colleagues and I have noticed changes in the reporting of information from the Michigan Economic Development Corporation. Several MEGA-related employees work at the MEDC and Authority meetings are likewise held at the MEDC office in Lansing. In nearly every instance the change in data output from the MEDC on its programs resulted in less information and less accountability as opposed to more.
The most egregious case in point involved a very discreet change in the law that allowed the MEDC to wiggle out of scrutiny by the state’s Auditor General. The following description of the change comes from my Viewpoint Commentary entitled “The Wizard of Oz Has No Clothes,” written for the Mackinac Center for Public Policy, earlier this year.
Scrutiny of MEDC job creation claims may lead the public to wonder why the department even exists. Perhaps this is why legislators have tweaked language in the state budget guiding audits of MEDC job creation claims. Prior to 2008, boilerplate budget language read that the MEDC "shall work with the office of the auditor general to implement procedures to annually audit the number of jobs claimed to be created by firms." For some reason the text was changed for the current state budget, which reads that the MEDC "may implement procedures to annually audit the number of jobs claimed to be created by firms." What had been mandated is now optional, and the reference to working with the auditor general was stripped away. One has to question the wisdom of allowing the MEDC to audit job creation it claims to have influenced.
In other words, MEDC officials apparently just want us to take their word for it. But we should not because the bureaucrats have an incentive to make the programs they operate appear successful, as if the Great Oz has spoken and jobs have appeared and we should just not presume to question.
The general public may not appreciate why the MEDC tries to avoid such scrutiny, but it should be clear. The more transparent a bureaucracy's work the easier it is for legislators, opinion page editors and others to question the need for a program or department’s existence.
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