Economic Growth and Right-To-Work Laws
Mackinac Center adjunct scholar Michael Hicks, Ph.D., and Morey Fiscal Policy Director Michael LaFaive published in August a unique contribution to the literature on right-to-work laws and associated economic growth. The study included data on personal income, total employment and population from 48 contiguous states plus the District of Columbia over a 64-year period.
This large swath of data is fairly unique to right-to-work studies, which largely examine shorter and more recent time frames. Hicks and LaFaive also divided their master data set into three subsets that ran from 1947 through 1970, 1971 through 1990 and 1991 through 2011.
What they found was that the presence of a right-to-work law lifted personal income by 0.8 percentage points and population by 0.5 percentage points from 1947-2011, on average. In other words, if a state would have had a 2.0 percentage point increase in income growth and adoption of a right-to-work law made that 2.8 percentage points, then the personal income growth rate was lifted by 40 percent as a result of the law.
The early years showed little impact from right-to-work laws, but significant improvements in economic growth were noted in the middle era. Modest but important improvements existed in the third period (1991-2011).
The goal of the Berrien Springs study was to tell the story of another innovative school district in Michigan. Berrien Springs is leading the way in various online learning opportunities and a diversified curricula offering to its students. It’s pushing back against the notion that school districts need to maintain their local monopolies by opening their doors wide for Schools-of-Choice students (a quarter of its enrollment is through SOC). Students who are not being served well by their local districts (in Battle Creek, for example), are now benefiting from these educational services. The district is changing its purpose from being the “educator of last resort” for district residents to “a district of choices” for as many students as possible.
“Waivers Are Temporary But Expansion is Forever”
Propopents of Medicaid expansion in Michigan argued this summer that reforms in the bill made the expansion’s long-term fiscal risks worth taking. The reforms, however, depend on obtaining permission from federal agencies in the form of “waivers” from the standard Medicaid regulations and legal requirements.
In a study authored by legal scholar Robert Alt with Nathaniel Stewart, and jointly published by the Mackinac Center and Ohio’s Buckeye Institute, this policy is explored. It reveals three ways in which the waiver process provides a shaky foundation for any genuine Medicaid reforms.
First, as the title asserts, Medicaid waivers are temporary. This makes today’s reforms subject to the whims of future federal bureaucrats.
Secondly, waivers are subject to the discretion of current federal bureaucrats and the current administration. It is unlikely that genuine reform lies best with the original authors of the law. Moreover, while federal officials have broad discretion in some matters, in others the governing statutes limit what they may permit.
Thirdly, even if a state successfully navigates those potential obstacles, any agreements are subject to judicial review. The study cites examples of states that thought they had an understanding with the federal government regarding reforms only to have the rug pulled out later by the courts.