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Rick Snyder, MBA '79/JD '82, Wins Michigan Republican Primary

8/6/2010 --

ANN ARBOR, Mich. — Rick Snyder, MBA '79/JD '82, beat out a field crowded with well-known political veterans to win the Republican primary election Aug. 3 in the race to be Michigan's next governor. Snyder, the former president and COO of Gateway Inc., has never held political office, and rode his outsider status to victory in a state with the nation's highest unemployment rate. Snyder touted himself as "one tough nerd" in TV ads, arguing that it's time to reinvent Michigan's government. His private-sector approach is what the state needs, according to his business-oriented pitch. Snyder finished ahead of fellow Ross alum Pete Hoekstra, MBA '77, a congressman from western Michigan. He now faces Democrat and Lansing Mayor Virg Bernero in the November general election. Current Gov. Jennifer Granholm cannot run again due to term limits.

After his time as a Gateway executive, Snyder set up venture capital fund Ardesta in Ann Arbor and helped create and lead Ann Arbor SPARK, a public-private economic development organization. He's always pursued lofty goals but usually quiets naysayers with concrete achievements. He's quieted quite a few by finishing on top of the Republican side after some pundits wrote him off as longshot for Michigan governor. But the journey isn't over and he faces a tireless campaigner and firebrand in Bernero for the ultimate goal.

The following are excerpts from an interview conducted with Snyder shortly after he announced his candidacy.

Why did you decide to run for governor, despite never having held office before?

Snyder: The most frequently asked question I get is, "Why would you want to be governor?" And the interesting part is the intonation as much as the question. People wonder why someone would want the job given the circumstances. But I really do, and it's for the intersection of three reasons. One, Michigan is an economic disaster. We're losing a million jobs this decade, we have (high) unemployment. We're losing a family every 12 minutes. Two, I believe there's a fundamental lack of leadership in Lansing. There's no clear direction, there's no vision, they're ignoring problems, and using Band-Aids instead of long-term, structural fixes. And they're in conflict instead of working together for the common good. Three, I don't believe that a traditional politician is the answer. I think [traditional politicians] come from a culture that's broken. We need to bring the knowledge and tools from the business world to get us on a positive track and fundamentally reinvent the economy in this state and in our government.

We've heard plans to reinvent government before from others. How can you, as a political outsider, get that done?

Snyder: Look at the business world: We reinvent ourselves multiple times or we wouldn't be in business. There have been a number of periods where that's the case. You can look at the period we're in now, or look at the tech bubble period. You can identify multiple periods where if we didn't reinvent our practices we would have been put out of business. Those are the kind of skill sets we've learned that we need to apply to government. A simple case I like to talk about is the budgeting process. It's been an absolute failure in the state of Michigan. [The state government shut down twice in recent years when budgets were not agreed upon in time.] Your business would never survive if you did cost-based budgeting. There's where departments ask for money, say they're doing to do a whole bunch of stuff, and then next year ask for more money so they can do more stuff.

What we need is outcomes-based budgeting, which lays out a set of outcomes to achieve. We would be held accountable and measured against other states and even other countries. We want to deliver results and tell people, 'This is how we're going to build up a budget. You, as citizens, customers, want to buy these services and deliver these outcomes.' They say you can't do that in government. Well, it's worked successfully in other places, why aren't we looking at it here? The state of Washington has been doing this since 2003. They had a major budget crisis, a $2.5 billion deficit, they had to cut 10 percent of the budget, and they went through outcomes-based budgeting. I like to call it value-for-money budgeting because we need to show value for money to our customers, the citizens. And they went out and surveyed people from both parties. And people from both parties thought the process worked. Independents thought the process worked. So here you have a situation where you can get everyone on board. Everyone might not be thrilled, but they understand it's a fair and open process involving citizen input in a way that builds up a project with real outcomes and real results. Why aren't we doing that? It's been done. It's not impossible in government.

Michigan has an incumbent leaving and a poor state economy, so if there were a time when the public might embrace an outsider, do you think this is it?

Snyder: I think people are excited. When I talk to people, I get a great response. My main issue is name recognition, getting out there and getting known. People know most of this stuff is common sense. Politicians have lacked transparency and have been caught up in this win/lose attitude. It's a culture that just doesn't work. We need to get out of that and break out in the open and say, 'We can all win together. We can make Michigan a great state again.' It's about Michiganders stepping up and taking our state back from people who are not doing their job right so we can run it the appropriate way. I often ask, 'If our government were a business, what would you do with these people?' And the answer I get from many people is, 'Fire them.' So why do we put up with this?

You are a product of the new economy, or what we used to call the new economy, and you've lived in other states. You've also led a big tech company. What does Michigan need to rebound, and how would you get that done?

Snyder: We need to change the concept of government from bureaucracy to customer service. The role of government should be to serve our citizens and customers. And everything we do shouldn't be through the lens of, 'We're government and we're going to go out and do stuff.' It should be, 'If you're a citizen, how can we help you be more successful?' And within that we need to be much more competitive on our tax and regulatory system. The Michigan Business Tax is the dumbest tax in the United States. Our regulatory system is biased toward assuming people are bad and they need to be controlled, versus the average citizen is a good and you need to deal with the exceptions. So we need to actually make a much more competitive playing field and reduce these Band-Aid things like incentives. If you have a competitive playing field, you don't need Band-Aids. The second thing is to go to the concept of value-for-money budgeting. What's the return on investment we're giving you? Why are we a good shopping choice? We need to be showing our worth to be on your shopping list.

What did you learn at Ross that maybe you've applied to your career and your campaign?

Snyder: I learned a lot there. That's a tough question because it's blended so much into my life. It's just part of me. One thing I really appreciated was that most of the people I met in business school had work experience. Here I was, a kid of 19, working in teams with these people. And it was just an awesome experience when people who had divergent backgrounds developed the chemistry to work as a team. It's one of those soft things, but it was a critical skill set to learn.

I've faced the challenge of people saying I can't do something my entire career. Actually, I thrive on that. I built this plan to get three degrees in six years when I was 16. So I designed it to get my bachelor's when I was 19, my MBA when I was 20, and my law degree when I was 23. I was an adjunct professor in the business school teaching tax when I was 24, 25, 26. I'd show up and most of the people were older than I was. But that's an important lesson. Teaching working people isn't taking the position that you're smarter or better than anyone else. I just happen to have more knowledge in the field, and we're there to learn together. We're all solid people. People aren't better than one another. The question is, how can you take that knowledge and share those tools with other people so we can all learn together? That's the same kind of message I want to bring to government.

—Terry Kosdrosky



For more information, contact:
Bernie DeGroat, (734) 936-1015 or 647-1847, bernied@umich.edu