"As of July 15, Michigan owes the U.S. Treasury more than $2.2 billion. That's money the state has borrowed to pay unemployment insurance benefits because many businesses have not paid enough into the system. "

As if the businesses have by design, put not enough into the system. Certainly not because the supplying pool is lessened, and the drain upon the system is greater by the decisions of a government which hasn't a clue on economic forces!

The current 15.2% unemployment number in Michigan is hardly understated, as many have merely given up, or moved elsewhere.  Add to this the extensions for the lengthened down times by manufacturing related to the auto industry which has taken a hit to the point of re-organizational bankruptcy by two of the "giants" of Detroit.  Reorganization that was inevitable, yet only put off to become a worse problem by government intervention.

The folks who might have collected extended benefits surely had their pain relieved for a short time more, but the end result is that they still have, and will still have to find other means of employment here, or move to another state.  In the mean time, employers who have weathered the storm of economic instability will now be asked to shoulder the larger premium for the unemployment benefits already given, as well as the expected long term continuance of those benefits.

To do so, means the existing businesses will be saddled with further expense.  Further, because the unemployment formula is based on the wages, it means that the increase in the minimum wage will aggravate an already open sore, necessitating employers to look at the total number of hours they can support with an eye on savings, and causing more of a bleed on employment. So the cycle spirals on.

In fact, the wage guarantee (minimum wage) on its own perpetuates the unemployment numbers without the added cost of the unemployment premiums.  The relatively low responsibility "entry level" jobs have indeed showed a marked decline in Michigan since Michigan's governor Granholm announced that the 2006 signing of a minimum wage increase would help ...
 

" investing in the safety and security of our families by calling for an increase in the minimum wage, giving every worker an opportunity to save for retirement, protecting our seniors in nursing, demanding new standards of corporate accountability and ethics laws for elected officials. "

Unfortunately, the employers who were "offered " the opportunity to make such things happen often times befuddle those who operate without an even basic understanding of economics.  The expected (or so stated) results were far from desired.

As a budgetary matter, if your business can only afford so much for the entry level positions it provides, then making the cost per participant more can only yield fewer jobs.

As a basic math exercise demonstrates..  

Employees are APPLES.  Each apple has a value..  If a business can afford only $50 worth of apples as a static, then a $5 apple gets that business 10 apples.  If there is a price control that makes the apple artificially expensive, it hardly changes the static expense the business must bear.  A $7 apple is going to limit that employer to 7 Apples.  The other three might as well rot.

Given the screams I expect on this analogy such as "you cant compare workers with commodities!," or  "people who are paid $5 will only be worth $5," I should point out that saying something, or someone is worth a particular value hardly makes it so.  Value cannot be determined properly by government, or any person on behalf of another.  It is determined by the person who will either BUY or NOT.  End of story. If the business cannot reach the desired goal the owner would like it to, (which usually involves making a profit) then it makes little sense to remain in business.

What an incredibly simple concept!  For those  readers who doubt this, would you shell out $100,000 for a Prius, if walking was an option? Likewise, a small entrepreneur is unlikely to hire at all, if they could possibly perform the tasks without the not so silent partner of government, putting limitations on that person's decision making ability.

Unemployment insurance is touted as protection for those who would lose their jobs unexpectedly, and Minimum wages are argued as a means to provide a living income for the unskilled, and otherwise untrained.  A practical, (if not a historical statement as well) can easily be made that both efforts merely ensure greater obstacles for businesses to hire, and create the very employment which would solve the problems naturally.

As an aside, I have posted a (perhaps controversial) supporting article here: A Dollar an Hour!