Having failed to deliver on much of its promise, Michigan’s corporate subsidy program warrants review and reform. But rather than reshape the program to grow the economy, Lansing Democrats have again proposed to grow the government.

Legislation to overhaul of the state’s business development and corporate incentives efforts glosses over fundamental flaws that have made the program ineffective while reinventing it to expand government through a new raft of spending that has little to do with actual job attraction.

Despite some promising measures, the legislation as passed Tuesday by the Senate would dilute the state’s economic development tools and weaken its ability to compete for critical investments.

That’s not a position Michigan can afford to be in, particularly as Democrats have reversed other provisions, such as right-to-work, that help attract businesses.

The 10-bill package would divert up to $250 million of the roughly $500 million a year from the Strategic Outreach and Reserve Fund (SOAR), renamed “Make it in Michigan,” to a new fund for subsidized community investments called Michigan 360.

The new program sounds like a big pork barrel.

Instead of site preparation, job creation or other economic catalysts that would make Michigan a more competitive place to do business, the money would go toward a wide variety of expensive new initiatives, such as child care, workforce training, high-speed internet, climate-friendly infrastructure and affordable housing, that are already elsewhere in the budget.

In addition, lawmakers could pick winners and losers based on new and subjective criteria, including a business’ commitment to climate activism and support for unionization.

The diversion of funds will allow companies and communities “to successfully grow together,” said bill sponsor state Sen. Mallory McMorrow, D-Royal Oak, when the legislation was introduced last year.

But community development has a nebulous link to luring the kind of advanced manufacturing and knowledge-based companies Michigan needs.

Since SOAR began in 2021, the state has spent $2 billion dollars on massive incentive packages to fund jobs that pay lower than the median average and cost far more than they pay. It is difficult to predict the reliability of promised benefits and returns on investment.

Now that federal COVID money to the state has dried up, lawmakers appear eager to get their hands on any new pots of funding.

Democrats have already essentially permanently raised the income tax rate to 4.25% from 4.05% in another attempt to pay for new government programs and giveaways.

In a noteworthy critique of policy authored by her party, Gov. Gretchen Whitmer said she did not agree with the main Michigan 360 measure before the Democrat-controlled chamber voted on it. She should use her influence to move it in the right direction.

The program’s sole focus should be providing reasonable economic to spur economic growth that fosters its own community growth and amenities.

Narrowing the criteria to only businesses that agree with Democrats on transit, affordable housing and other community priorities will disincentivize businesses from even considering Michigan to begin with.

— Detroit News