Financial Audit Podcast – Episode Summary

Podcast: Financial Audit
Host: Caleb Hammer
Guest: Governor Gretchen Whitmer (Michigan)
Episode: "I Confronted The Governor Of Michigan | Financial Audit"
Date: November 10, 2025

Overview

This special episode features an in-depth, candid conversation between podcast host Caleb Hammer and Michigan Governor Gretchen Whitmer. The episode is part "financial audit" of the state, part political interview, and part policy deep dive. Together, they explore Michigan's finances, economic policy, industry incentives, social programs, education, and even the wider climate of political extremism in America. Hammer blends data-driven critiques and questions with an approachable, occasionally irreverent tone, while Whitmer provides context, defends policy, and offers both optimism and realism about Michigan’s path forward.

Key Discussion Points and Insights

1. Michigan's Finances: State of the State

• Population & Economic Importance
  Michigan is the 10th most populous state, straddling "rust belt" legacy and future-facing industry (03:22).
  Hammer underscores Michigan as a bellwether for other states.
• Budget Priorities & Revenue Distribution
  • Whitmer sees the state’s "North Star" as ensuring Michigan is a place "anyone can come to build the life they want." (03:41).
  • Focus areas: skills for advanced manufacturing, investing in appealing places to live, and attracting world-competitive projects (04:04).
• Manufacturing Transitions
  Manufacturing change and the rise of electric vehicles (EVs) have shaped policy and incentives.
• Debt Management
  • Michigan's outstanding debt is $6.9 billion, but recently reduced by 4.2% ($300 million), which Hammer calls "pretty chill" (14:47).
  • Bond rating has been upgraded, reflecting improved fiscal health. "It's important to have our fiscal house in order...It impacts everything..." (15:11 - Whitmer).

2. Industry, Globalization, Tariffs

• Tariffs and Trade Policy
  • Whitmer: "You gotta use tariffs like a scalpel, not a sledgehammer." (06:58, 07:05)
  • Michigan’s economy is sensitive to tariffs, especially in auto and agriculture.
  • Hammer pushes on the bipartisan divide between globalism and nationalism, citing manufacturing job losses post-NAFTA (~05:44 - 07:29).
• Incentive Packages and Shifting Investment
  • Discussion on state incentives for auto and battery plants (e.g. Blue Oval Battery Park cut from $1.03B to $409M).
  • Whitmer stresses the challenge of maintaining policy stability for business amid federal changes (10:42-12:26).

3. Pensions, Social Programs, and Spending

• Unfunded Pension Liabilities
  • Hammer voices worry about Michigan's pension underfunding ratio: 74.8% funded, improved from 66% but still ~$24.4B underwater (21:51-23:16).
  • Whitmer says: "We have a duty to fund them," but notes the system is being phased out for future employees (22:39, 27:55).
  • No "dictatorial" fix is possible due to legislative process and political makeup (23:56).
• Social Welfare and Incentives
  • Nearly half of state spending (44%) goes to Health and Human Services, including federal food assistance (19:15).
  • Hammer worries about benefits cliff effects: "I've had people choosing not to work more hours because they'd lose benefits." (19:44)
  • Whitmer counters: "We want to incentivize work... That's just not true [about Michigan creating better benefits than other states]. All states follow federal rules." (20:11-20:44).

4. Education and Personal Finance

• Education Funding
  • Discusses sources like marijuana and gaming taxes supporting the School Aid Fund (30:12-32:15).
  • Whitmer acknowledges discomfort with "sin taxes" but argues they're practical policy tools (31:21-31:33).
  • Education's share: 31% of spending; major increases in stabilization/rainy day fund for schools (32:34-33:25).
• Personal Finance Curriculum
  • Michigan now requires a personal finance course for high school graduation (54:25 onwards).
  • Whitmer: "We've got to give people the tools they need..." (54:25)
  • Course aims to teach budgeting, understanding markets, basic financial literacy.

5. Tax Policy and Progressiveness

• Tax Rate Adjustments
  • Personal income tax rate shifted from 4.05% to 4.25%; Whitmer says she "follows the law," not championing cuts without credible plans for lost revenue (35:53-36:36).
• Earned Income Tax Credit Expansion
  • State now offers a larger EITC (rebranded "Working Families Tax Credit"), matching 30%, to support low-income workers (38:50–39:57).
  • "It is disproportionately... over 50% supports people who are also raising kids." (39:32)
  • Whitmer frames efficient redistribution as essential for a thriving workforce and business climate.

6. State "Pork" and Transparency

• Discretionary and Pork Spending
  • Hammer highlights nearly $1B in one-off grants (e.g., sports complexes, museums, zoos), dubs some questionable as "bull spending" or "taquitos" (44:04–47:03).
  • Whitmer expresses strong support for greater transparency and front-end scrutiny: "There should be a bidding process or front-end transparency, which is what I think we're going to get done." (47:03).
• Special Programs
  • Some spending (e.g. on Special Olympics, E-bike incentives, local arts) defended as generically common but acknowledged for improvement potential.

7. Industry Regulation and the Auto Sector

• Tesla Sales Restrictions
  • Hammer critiques Michigan's franchise laws that bar direct Tesla sales and local servicing (56:54-58:16).
  • Whitmer: "It would take an act of the legislature to get it done... But there's no shortage of Teslas on Michigan roads!" (57:33–57:44).

8. Political, Demographic & National Themes

• Population Growth Concerns
  • Michigan losing residents, ranks 49th in population growth (49:57-50:09).
  • Whitmer admits Michigan's older age profile is a factor, but touts the first "chief growth officer" in a US state (67:03).
• Political Extremism & Violence
  • Hammer and Whitmer express alarm at rising political violence, noting recent assassinations and threats (68:54-70:52).
  • Whitmer: "I take it so seriously...I speak out against it every single time...It'd be refreshing if everyone with a platform did that." (70:52)
• Long-term Economic Trends
  • Migration of wealth out of high-tax states stirs debate on progressive tax hikes (65:50).

Notable Quotes & Memorable Moments

On Tariffs:

“You gotta use tariffs like a scalpel, not a sledgehammer. It's not the answer to everything.”
— Gov. Whitmer (06:58)

On Budgeting & Fiscal Health:

“It's important to have our fiscal house in order... It impacts everything that we're trying to do.”
— Gov. Whitmer (15:11)

On Political Identity:

“I'm aggressively, boringly, but obnoxiously centrist... I'm an obnoxious fence sitter.”
— Caleb Hammer (08:39)

On Social Programs:

“We want to incentivize work. We want people to be gainfully employed and not reliant on state funding. But we recognize that there are a lot of people who right now are struggling to just take care of their daily needs, their family's needs.”
— Gov. Whitmer (20:11)

On School Funding via Sin Taxes:

“Sin taxes are always the easiest taxes for legislators to take votes on... That’s generally why we see them continuing to fund things like schools and everything else in state government.”
— Gov. Whitmer (31:33)

On Education & Personal Finance:

“We've got to give people the tools they need to take care of themselves... and we had to do it before they head off to college and get that credit card when they're 18 and buy a stupid piano.”
— Gov. Whitmer (54:25)

On Political Violence:

"I take it so seriously...I speak out against it every single time...It would be refreshing if everyone with a platform did that."
— Gov. Whitmer (70:52)

Timestamps for Important Segments

• Michigan’s Economic Role & Budget Approach: 03:22–04:39
• Tariff Policy Discussion: 05:09–07:29
• Industry Investment & Incentives Debate: 09:25–12:13
• Fiscal Health & Pension Concerns: 13:37–23:16
• Welfare System & Work Incentives: 19:15–20:44
• Education Funding Sources: 30:12–33:25
• Personal Finance Course Requirement: 54:25–56:39
• EV Registration & Road Funding: 41:18–42:18
• Pork Spending Transparency Talk: 44:04–47:03
• Population Decline & Growth Initiatives: 66:53–67:31
• Political Extremism & Solutions: 68:54–70:52

Tone and Conversation Style

• Caleb Hammer: Analytical, data-driven, yet casual and self-deprecating, often using humor ("I'm gooning over here. Do you know what gooning is?" 15:28) to make arcane topics accessible. He’s willing to challenge both left and right, presenting himself as a centrist and pushing for transparency and fiscal responsibility.
• Governor Whitmer: Candid, knowledgeable, and practical. Freely acknowledges shortcomings (e.g., pension gaps, reliance on sin taxes) but steers conversation toward pragmatic improvement and bipartisanship. Offers both a defense of current policy and some admissions of where she wishes things could improve.

Conclusion

This episode delivers a wide-ranging, nuanced overview of Michigan’s fiscal health, social priorities, and economic challenges. Whitmer offers insight into the difficulty of balancing progressive ideals with fiscal reality, while Hammer provides skeptical, informed questioning and context. The exchange manages to be both wonkish and entertaining, rich with practical takeaways for viewers with any level of background in state policy or public finance. The episode closes on positive notes—personal finance education, Michigan pride, and a candid acknowledgment of national challenges.

For listeners:
If you want to understand how a major state government thinks about its money, the role of politics in budgeting, and why it matters for regular people, this episode is a must-listen. You'll also get a glimpse of two personalities—one in office, one in media—meeting on common ground and debating where they differ.