Pi Day Discussion: Why government budgets aren't analogous to a pie sliced and served

Posted at 5:42 PM, Mar 14, 2022
and last updated 2022-03-14 21:47:32-04

DETROIT (WXYZ) — On Pi Day, many people celebrate by eating pie. We decided it would be a good time to talk about how many people look at government funding like pie being sliced up, and some say there is a different perspective to consider.

When President Joe Biden signed the $1.9 trillion American Rescue Plan Act, you could say Michigan received a proverbial $6.54 Billion piece of that pie.

The National Conference of State Legislatures tracks how states spend the proverbial American Rescue Plan Act pie. Its tool shows so far Michigan has allocated 13% of its estimated 6.54 billion dollars.

Most has gone to Economic Relief and Development, followed by the Unemployment Trust Fund, Education, Public Health, Arts Culture and Tourism, and Infrastructure.

Right now lawmakers are debating how to spend the rest of the pie. Policy experts warn as we debate spending we often make a mistake and just think about the limited pie we have and how to slice the pie.

“Let’s increase the size of that pie,” said Sandy Baruah, Detroit Regional Chamber President.

As we play on “Pi Day” with this topic, Baruah says the thing the number pi and government budgets have in common is they are complex. Government budgets can actually increase when we do certain types of spending. For example, he is lobbying for economic development investments, which he says increase tax revenue.

Baruah says the public should not just ask how much programs cost as it considers them, it should ask how much programs can increase tax revenue.

“Some of it is the eye of the beholder. What is one person’s long-term investment is someone else’s frivolous expenditure. But certainly, the State of Michigan is woefully behind on key investments. Look at our infrastructure, bridges, roads, underwater systems,” said Baruah.

“It is not a zero-sum thing. So you can think about cutting up the pie and giving a piece to everybody. Or you can think about leaving some to make more pie, I guess,” said Stephanie Leiser, University of Michigan Ford School of Public Policy Lecturer.

Leiser says one flaw at the federal level is that the government doesn’t always differentiate between overspending and investment debt. She says perhaps it should to help the public understand where we stand and where we are going.

“When you look at things like the federal debt part of that went to investments that will pay off over time and part of it goes to our credit card of current spending,” said Leiser.

The message is, we shouldn’t just debate how to slice a pie. Citizens should engage with lawmakers to debate how strategic slicing can lead to investment returns and a proverbial bigger pie in the future.

Happy Pi Day!