The Building Tradesman Newspaper

Friday, April 28, 2017

'Ideological nonsense' - Mackinac Center issues bogus link of right-to-work with higher wages

By Marty Mulcahy, Editor

Earlier this month the West Michigan Policy Forum circulated a media release citing a Mackinac Center for Public Policy report linking residents' higher incomes with the state's right-to-work law, which went into effect four years ago.

But they’re drawing an important conclusion with completely misleading evidence.

Logically you would assume the Mackinac Center, a conservative think-tank, would compare recent income levels of state workers vs. their income levels in April 2013, when the state's right-to-work law went into effect. But for comparison purposes, they instead chose to compare higher 2016 incomes with the worst case scenario of those in 2009 -when Michigan happened to be at its worst point economically since the Great Depression. 

"In 2009, at the low point of the Great Recession and Michigan’s 'lost decade,'" the Mackinac Center reported on April 3, "residents of 39 other states had a higher income than people in Michigan did. By last year, we had risen to No. 31 on this critical measure of economic well-being for families and small businesses." Frankly, a rise of eight positions among the bottom half of the 50 states still isn't all that praiseworthy. 

Although for the year 2016 alone, the Mackinac Center also pointed out that Michigan's per capita personal income grew faster than that of 40 other states. That is also not particularly relevant to their case, as right-to-work states are represented in both the top 10 and bottom 10 state rankings for personal income hikes last year. 

Mitch Bean, former director of the House Fiscal Agency and partner in Great Lakes Economics, told the MIRS news service that the state's rising income tide and lowered jobless rate aren't unique, and aren't related to the state's right-to-work law. “It's happening all over the country,” he said.  “What's happening in Michigan is not remarkable at all.  It's happening all over the country, it's just the improving economy.” He added: “What the Mackinac Center is quoting is ideological nonsense."

Jase Bolger, the Republican speaker of the House when RTW was adopted in December 2012, told MIRS that passage of right-to-work "was part of a bigger issue. That there wasn't any single issue that was going to fix Michigan's ills.  But I think right to work was an important part of that puzzle, an important part of that fix.” 

Right-to-work is no fix at all, says the labor-backed Economic Policy Institute, which has extensively studied the effects of RTW over a period of decades. It said RTW is a "statistically significant" impediment to higher worker wages.

"Wages in RTW states are 3.1 percent lower than those in non-RTW states, after controlling for a full complement of individual demographic and socioeconomic factors as well as state macroeconomic indicators," the EPI reported in 2015. "This translates into RTW being associated with $1,558 lower annual wages for a typical full-time, full-year worker."

Michigan's right-to-work laws were adopted in the December 2012 "lame duck session" of the Michigan Legislature, with zero public debate. Some 10,000 labor union members and supporters showed up on the state Capitol lawn to express their displeasure, with many union leaders saying the law had nothing to do with economic growth, but had everything to do with weakening labor unions. Right to work laws allow the use of "free riders" in a bargaining unit to enjoy the benefits of union representation, without paying dues.

"Let's be clear, right-to-work never had anything to do with growing Michigan's economy, it was about Republicans in Lansing rigging the system to favor their corporate donors over regular working people," said Zach Pohl, communications director for the Michigan AFL-CIO. 

"The good news is, Michigan workers still see the value in a union contract, because it means good wages, strong benefits, a secure retirement, and more time to be with family. Republicans like Jase Bolger, Rick Snyder, and Bill Schuette need to get their priorities straight, and they ought to start working to make Michigan's economy work for everyone, not just the wealthy."