Reinventing Michigan for Our Future vs. Protecting the Past and Special Interest Groups

You may have heard about the 7-year-old entrepreneur named Julie Murphy whose business as a lemonade stand at the July Multnomah County, Oregon monthly art fair was shut down and threatened with a $500 fine. The government regulation she violated? Failing to get a $120 temporary restaurant license. Inspectors Shut Down Girl's Lemonade Stand

This serves as an extreme example of government interference with job providers which is stifling our economic recovery. We have a clear choice in this election for State Representative in the 55th legislative district of Michigan.

• I favor getting government out of the way and cut taxes to let small businesses create jobs. There should be no bailouts for union bosses, or dollars for special interests not tied to real job creation. I favor workers’ choice in the workplace.
  
  
• My Democrat opponent? As a AFL-CIO Community Service Liaison to the United Way, a long time member of the United Steelworkers local 2511 District 2 AFL-CIO who has served as Chief Steward, Trustee and President of the local and currently represents local 2511 as a Delegate to the Monroe/Lenawee County AFL-CIO Central Labor Council, he can be expected to protect the past, opposing necessary reforms related to labor laws (although none of his publicity is specific enough beyond buzz words to know just what he stands for). (And his “Issues” page on his website is blank.)

Currently, labor laws allow unions to collect membership dues from workers covered by a collective bargaining agreement, regardless of whether or not they support the union, and with precious few checks and balances to assure that union money and power is actually used to further the interests of workers.

An August 2002 EPIC/MRA survey commissioned by the Mackinac Center for Public Policy, reported in Michigan Voters Support Labor Reforms, g. 28, 2002, http://www.michigancapitolconfidential.com/4571 showed that there was support to make the union bosses more accountable.

A financial disclosure bill, e.g. House Bill 6226 of 2002, would require public employee unions to open their financial records to members. When asked whether they would favor a bill requiring annual financial reports from government employee unions, 73 percent of those polled indicated they would do so, with 47 percent saying they would “strongly favor” such a bill. Of those who identified themselves as union members, 72 percent expressed their support for union financial disclosure. Only 15 percent of those questioned expressed opposition to the financial disclosure law. Only with full disclosure can workers fully exercise their right to choose whether to support the continued existence of the union. This is clearly a “union bosses” vs. “the workers” issue. I side with the individual workers.

A paycheck protection bill, e.g., House Bill 4252 of 2002, would require unions to obtain authorization from individual union members before using those members’ dues money for purposes other than bargaining or implementing an existing collective bargaining agreement. Such a law, if implemented, would prevent union dues money from being spent on political activities or lobbying without the approval of workers. Sixty-three percent of those polled expressed support for such a law. Twenty-five percent were opposed. The number of union members favoring paycheck protection fell just short of a majority, at 49 percent. I support the workers’ right to choose whether to support any political parties or ballot measures, and not leave it to the sole discretion of the union bosses.

"Right to Work” laws are state statutes or constitutional provisions which ban the practice of requiring union membership or financial support as a condition of employment. Twenty-two states have enacted Right to Work legislation. Michigan is not one of these states with right to work protection of the employees. Instead, Michigan has a union shop provision allowing employers and unions to negotiate rules that mandate that employees join a union or pay union dues and fees. See http://www.nrtw.org/ Few employers can withstand the union pressures to agree to those provisions.

Senate Bill 945, sponsored by Sen. Nancy Cassis, R-Novi, is a bill that would allow local governments to create the right-to-work zones. (This is different from House Bill 4454, introduced by state Rep. Jack Hoogendyk, R-Portage, in 2008 which would have given workers in a union shop an opt-out of participating or paying dues to a union, in other words, a state-wide implementation.)

“Within these proposed zones, employers would be prohibited from compelling an employee to join a union under threat of either being fired or never hired in the first place. Free-market labor analysts have repeatedly noted that there is a strong correlation between a state's economic growth and whether it provides right-to-work protections to its workers. And polling data has indicated strong public support for Michigan becoming a right-to-work state.” [A June 2002 poll of likely Michigan voters indicated that 62 percent would favor a Michigan right-to-work law. Only 22 percent of those polled were opposed to this idea.] . . .

“A 2007 analysis by Mackinac Center labor policy director Paul Kersey examined the correlation between a state's economic success and its adoption of a right-to-work law. Looking at the five-year period from 2001-2006, Kersey reported that states with right-to-work laws increased their gross state product by 18.1 percent, while states without a right-to-work law saw GSP grow by just 13.6 percent. Michigan was one of the worst non right-to-work performers, growing by just 3.4 percent.

Even Louisiana and Mississippi - two right-to-work states that saw massive economic damage due to being hit by Hurricane Katrina during the period under examination - were still able to substantially exceed the GSP growth of Michigan.” http://www.michigancapitolconfidential.com/12537

Republican gubernatorial candidate Rick Snyder has opted not to make Right to Work a plank in his platform, likely recognizing that in addition to a massive voter education campaign, any successful workplace freedom initiative would require a population that has learned to dismiss the demagoguery of self-serving special interests who benefit from the status quo.

When Mike Bouchard announced his support for Michigan becoming a Right to Work state in his unsuccessful candidacy for Governor, he said, "The union bosses and special interests may be upset, and will probably target me, but I'm ready and willing to take on the tough challenges to turn our state around." I second that emotion. If we are going to pull the state out of our doldrums, we must take dramatic action to show that “Michigan is open for business.”

“University of Michigan economist Don Grimes said, “the state will have trouble competing for manufacturing jobs against states from the South that are almost all right-to-work. . . . If Michigan wants to go after manufacturing jobs, it should consider right-to-work laws.” Role of unions in Michigan during recession disputed

Prevailing Wage Laws. Under Michigan’s prevailing wage law, all contractors participating in a state or state-sponsored school construction project must compensate their workers b paying wage and fringe benefit rates found in local union collective bargaining agreements. While I was a school business manager at Adrian Public Schools supervising the $50 million bond project to renovate our schools, the contracts that fell under that provision cost us about 20% more than contracts that we could competitively bid out without that provision. With scarce dollars, we must do all we can to get the biggest bang for our buck, and that includes eliminating this budget busting provision.

Minimum Wage. The federal minimum wage is set at $7.25 per hour. With some exceptions, this amount is the lowest amount that a worker is able to make in the United States. States are entitled to pass higher minimum wages. Michigan’s minimum wage is currently $7.40 per hour.

No one will argue that $7.25 is a wonderful wage rate, but studies have shown that setting minimum wages reduces the number of people employed. Further, Michigan setting a minimum wage rate higher than the federal minimum wage is one more example of Michigan being antagonistic to employers. Small wonder we rank 48th out of 50 states in attractiveness for businesses to locate in Michigan.

“Card Check”. “The current method for workers to form a union in a particular workplace in the United States is a sign-up then an election process. In that, a petition or an authorization card with the signatures of at least 30% of the employees requesting a union is submitted to the National Labor Relations Board (NLRB), who then verifies and orders a secret ballot election.

. . .

Under the proposed Employee Free Choice Act (EFCA), if the NLRB verifies that over 50% of the employees signed authorization cards, the secret ballot election is bypassed and a union is automatically formed.” http://en.wikipedia.org/wiki/Card_check

The tension here is the workers’ freedom to choose without coercion as guaranteed by the confidentiality of a secret ballot versus the unions’ desire to more easily form new unions. I view the secret ballot to be a right we must protect, yet most Democrats favor the card check bill.

Other Miscellaneous (but important) issues related to labor: The Democrats in Lansing:

• Overwhelmingly opposed blocking the 3% increase for unionized state employees even when a $1.7 billion deficit was projected.
  
  
• Oppose revision of PA 312 (which requires binding arbitration for police and fire fighters if agreement with the municipality cannot be reached) to require the arbitrator to consider the municipalities' ability to pay. Contracts awarded by arbitrators in the absence of that requirement have granted retirement pay and other benefits grossly out of line with reason. See Center for Michigan
  
  
• Oppose revision of the Urban Cooperation Act (which requires consolidating municipalities to pay the highest wages and the highest benefits of the consolidating entities, which results in higher costs after consolidation rather than lowering costs, and thereby discouraging consolidation rather than encouraging cooperation).

Where will my Democrat opponent come out on these issues? All relate to protecting the current practices which discourage controlling spending and creating an environment in which small business job providers can prosper and create jobs. My bet is that with his strong union background (and probable financial support for his campaign) he would vote with the liberal majority of the Democrat caucus and against job creation.

The choice is yours. I would appreciate your support.

Quick Hits Regarding Unions

Here are a few article qoutes and links that I think are instructive:

A. It is time for all Senators and State Representatives to do what is right, instead of being scared of or beholden to the government employee unions. This article chronicles several attempts to control costs that have been derailed by the public sector unions.

“Michigan has the ninth-most heavily unionized state and local government workforces among the states. In a recent article about the rise of public-sector unionism, New York professors Fred Siegel and Dan DiSalvo described how government employee unions are "bankrupting states and municipalities" because they "achieve influence on both sides of the bargaining table by making campaign contributions and organizing get-out-the-vote drives to elect politicians who then control the negotiations over their pay, benefits, and work rules.

In Michigan, one can add preventing the legislature from adopting reasonable public employee pay and pension reforms to that list.” Analysis: Government Employee Political Clout Obstructs Budget Reform, April 13, 2010

B. Here is some insight into what is happening with SEIU, one of the strongest government employee unions in the country and how they are extracting wealth from taxpayers and redistributing it to government workers.

“It is no coincidence that under Stern’s tenure the number of government union members surpassed the number of private sector union members for the first time in our nation’s history. There are two reasons for this: 1) Unions kill private sector jobs, and unionized companies earn profits 15% lower than those of comparable non-union firms. This makes unionized firms less competitive, which is why unionized manufacturing jobs fell 75% between 1977 and 2008, while non-union manufacturing INCREASED 6% over that same time. 2) Government union jobs face no competition. Public sector unionization has exploded in the past decade as leaders like Stern realized politics paid much better than the free market. Under Stern’s leadership, SEIU has become the nation’s second largest government union with over half of its membership drawing a paycheck on the taxpayers dime.” Morning Bell: Andy Stern’s America The Foundry: Conservative Policy News. April 13, 2010

C. More political payback from Obama for the unions' support in the 2008 elections. Elections to approve a new union would only require a majority of those voting, in contrast to prior law which required a majority of workers affected. Rule change aids union workers in airline, rail industries, from The Detroit News, May 11, 2010

D. Responsible contractor" provisions must be rejected, whether they be in federal law, state law or local municipality policies, as they drive up taxpayer costs, the last thing we need now with stretched public budgets. A "responsible contractor" policy allows bidders that provide higher pay and richer benefits for their workers to get an advantage in winning government contracts. In practice, the plan would favor firms whose workers are members of unions. Editorial: Fed contracts should favor best price, not unions, from the Detroit News, March 16, 2010

E. “The government class enjoys higher salaries, richer benefits and far better job security than the citizens they are supposed to be serving. . . . The 'public servants' have become the masters over taxpayers.” Good times still roll for government employees, from the Detroit Free Press .

F. We will not have a sustainable long-term budget plan without addressing public employee wage and benefit issues. The legislature, meanwhile, was not able to get the 2/3 vote needed in the State Senate to rescind the 3% raise for unionized state employees. With no Democrat support in the Senate, the Senate could not send the measure to the Democrat controlled House of Representatives, where it would have been even harder to get the necessary 2/3 vote. If we can’t even block pay raises to public sector union employees, is there hope to get cuts? State pay issue will get worse, from the Detroit News, April 2, 2010

G. “Public Labor Union claims of $700 million in concessions by state employees are a comparison of itself to itself. It pales in comparison to the sacrifices made by private sector taxpayers in Michigan that are being asked to foot the bill for their unrealistic benefit and pay levels. They have been shielded and protected from reality for far too long and it is a luxury that taxpayers in this state can no longer afford.” $700 Million in Concessions By State Workers? Really? Where Did That Number Come From? From the NFIB, March 18, 2010.

H. “State Sen. Nancy Cassis has introduced legislation in Lansing that would allow localities to set up what might be called “right-to-work zones. . . Among nearly all private-sector workers, labor relations are governed by federal law: the National Labor Relations Act. The NLRA is fairly exhaustive, and the courts have consistently interpreted it as “occupying the field” of private-sector labor relations, leaving very little room for states to act. But there’s one big exception carved out of federal labor law: States can regulate union membership and agency fees. This is where state right-to-work laws come into play.

“Right-to-work” prohibits unions and employers from signing contracts that force workers to join or financially support a union, leaving union membership and support to the conscience of individual workers.”

This local approach to Right-to-Work could be the means to bit by bit improve the image of the state as anti-business/anti-jobs, and make the state more competitive. Local Right-to-Work: Yes we can! Well, maybe. If we set it up just right..., October 28, 2009.

I. “Place the blame for the loss of the much-needed [Race to the Top] grants squarely on the Michigan Education Association. It sabotaged the state's application at every step. . . . But real change in Michigan's public schools will only come when parents and others concerned about the future of the state decide they've had enough of the Michigan Education Association's obstructionism. “ MEA's sabotage kept Michigan out of Race to Top finalists, From The Detroit News, March 7, 2010.