Vernuccio on Fox Business
New bills on school grading, third-grade reading proficiency
MIRS News reports (subscription required) that the House Education Committee is considering two bills: one to create an A-F letter grading system for schools and one to require third-graders be proficient in reading before advancing to fourth grade. Both of these ideas are recommendations made in a recent Mackinac Center publication, "Michigan vs. Florida: Student Achievement, Education Policies and Proposals for Reform."
A well-designed school accountability system with easily understood labels (A, B, C, D and F) would create positive incentives for schools to improve and provide parents and taxpayers with a better understanding of how well their tax-supported schools are performing. There is some research suggesting schools can improve under such a system, and 14 other states use similar school report cards, according to the Foundation for Excellence in Education.
Developing literacy skills in the early grades is crucial for later success in school. Committing to high standards in this area creates incentives for schools and parents to keep students on track to read proficiently. Research also supports the concept of banning social promotion for third-graders who cannot read proficiently. Seven other states have similar policies in place.
State needs fewer regulations, more jobs
Rather than being based on safety, licensing requirements for people to work are often imposed merely for the protection of existing businesses and to raise the barrier to entry for competitors, thereby driving up prices for consumers.
However, that could change if a bill introduced by State Rep. Tom McMillin, R-Rochester HIlls, were passed and signed into law. House Bill 4641 would prohibit governments from imposing occupational licensure without valid concerns for public health and safety, and allow workers to sue if a regulation excessively burdens their right to earn a living. This proposed state law would go a long way to solve the problem of burdensome and inconsistent requirements.
Michigan licenses painters, barbers, landscape architects and many other fields that are unlikely to harm people if performed incorrectly (not that there is evidence that most state mandates help prevent harm anyways). While these are silly and not needed, there are also many examples where the state licenses some things, and not others that are similar or even more complex.
Consider windows: It was pointed out to me recently by a friend that the state of Michigan requires a license to install a storm window (“screens and storm sash”), yet does not require a license to change out an entire window (though installing a totally new window does require a license).
The state also mandates licenses for painting and decorating, but not drywall hanging. Installing wood floors and tile, but not carpeting and vinyl. Putting up gutters, but not fences. Laying concrete, but not asphalt paving. House wrecking, but not house moving.
It should also be noted that each of the above licenses require 60 hours of approved courses, whereas an amateur pilot’s license requires only 40 hours of training and will allow you to fly anywhere in the country.
This doesn’t mean legislators should tack on more requirements for the areas not licensed. Rather, the evidence shows that people live and earn a living in many occupations that are not licensed and have had little or no safety concerns.
Possible plaintiff in federal suit against MEA
Amy Breza, a paraeducator in Clarkston Community Schools, is being forced to continue paying union dues after her union and the school board signed a contract extension before March 28 in order to skirt around Michigan’s new right-to-work law.
“Amy is not currently eligible for right-to-work, but she wants to explore her First Amendment rights into become in agency fee payer immediately,” MCLF Director Patrick J. Wright said. The MEA’s bylaw forcing members to only resign in August “is trampling all over her freedom of association.”
New CRC report highlights discrepancies
State legislators are considering reforming automobile insurance laws to save drivers money while still providing robust coverage.
As it is, ill-conceived state mandates cause Michigan drivers to pay among the highest insurance costs in the nation for the coverage they receive.
The Citizens Research Council released a study recently examining why the system is so expensive. The details are complicated, but in the end it comes down to basic economics.
Michigan is unique among states in that it requires personal injury protection coverage for all drivers, allows those injured to sue at-fault drivers for bodily injury, and pays unlimited medical benefits through catastrophic claims coverage (the next highest is New York, which limits payments to $50,000).
The report found that Michigan residents make more claims requesting more money while medical providers charge auto insurers more for care. No surprise: This leads to higher prices.
"Accounting for both higher prices and higher usage, medical claims in Michigan cost auto insurers 57 percent more than claims for similar crashes in other states; consequently, automobile insurance premiums are 17 percent higher on average," the CRC study said.
When adjusted for price and medical care, the CRC said the average auto injury claim in Michigan should be $12,885; instead, it is $20,229.
Because of the state mandate for coverage, as well as the fact that auto insurers are unable to negotiate the rates they are charged, incentives are distorted across the insurance system. CRC found that the claims from Michigan health providers are 24 percent higher than in other states, which inevitably leads to insurance companies paying more and passing the higher price on to consumers.
And people making claims from the Michigan Catastrophic Claims Association more than doubled from 2002-2012, meaning insurance rates increase to pay those claims. Rates are expected to skyrocket in the coming years.
For every medical category, CRC found that compared to other state health reimbursement programs, the medical costs associated with no-fault coverage were higher. That is, health providers were charging much more for the same care.
To take one extreme example: In Detroit, the reimbursement for no-fault insurance is 352 percent higher than Medicare and 227 percent higher than workers' compensation insurance for an emergency room visit (see chart nearby). Further, for the 15 most common medical charges, no-fault insurance paid on average 190 percent more in Lansing and 193 percent more in Grand Rapids than Medicare, and 93 percent more than workers' compensation in Lansing and 95 percent more than in Grand Rapids.
The report covers a lot of areas and is fairly complex. But the reason for high costs is clear: Since coverage is mandatory and insurers cannot negotiate on price, incentives for consumers shopping for insurance and medical providers requesting pay are distorted.
Michigan legislators should work to properly align the costs and benefits of the insurance market.
Discussing teacher complaints against MEA
Patrick J. Wright, director of the Mackinac Center Legal Foundation, was a guest on “Let It Rip,” a Sunday morning issue-oriented talk show on FOX 2 Detroit (click on segment two), discussing the MCLF clients who have filed unfair labor practice complaints against the Michigan Education Association. The clients feel they are being bullied and intimidated by the MEA for attempting to exercise their worker freedom rights.
House Bill 4234, Vehicle trade-in "sales tax on the difference": Passed 38 to 0 in the Senate
To exempt from sales tax the value of a trade-in when buying a new motor vehicle, titled watercraft or recreational vehicle, but phase this tax break in over 24 years, and halt the phase-in if the federal health care law's Medicaid expansion (authorized by House Bill 4714) is rescinded. Under this bill and Senate Bill 89, when fully phased-in the buyer would only pay sales tax on the difference between the value of the trade-in and the purchase price of the new car. Initially, the tax break would only apply to $2,000 of the price difference, which would increase $500 per year. When fully implemented the tax break's annual value would reach $226 million (in 2013 dollars).
House Concurrent Resolution 11, Authorize adoption of "Common Core" school standards: Passed by voice vote in the Senate
To authorize the State Board of Education and the Michigan Department of Education to spend money to implement a "Common Core" curriculum promoted by an entity associated with the National Governors Association, subject to various restrictions and conditions specified in the resolution. The authorization does not apply to an associated student testing regime, and directs the state board and the department to make implementation contingent on local districts retaining the ability to adopt a different curriculum. Because this was a "voice vote" there is no record of who voted "yes" and who voted "no."
Senate Bill 436, Require financial institutions help enforce welfare benefit restrictions: Passed 35 to 3 in the Senate
To require a bank that operates automatic teller machines in a casino, liquor store, or "adult entertainment establishment" to "work with" state agencies to ensure it does not allow a person to use a welfare benefits "bridge card" to withdraw cash from those ATMs.
Senate Bill 479, Repeal interior designer registration: Passed 38 to 0 in the Senate
To repeal a law that establishes a government interior designer registry and makes it available to state and local agencies that enforce building permit mandates. To be included on the registry, a prospective designer must have passed a test created by a national designer organization, or be approved by a state board comprised of incumbent interior designers. Designers have lobbied to impose a full licensure and regulatory regime on this occupation, with several bills introduced in previous legislatures.
Senate Bill 318, Repeal mandatory life sentences for minors: Passed 36 to 0 in the Senate
To repeal Michigan’s mandatory life sentence with no chance of parole for certain very serious crimes committed by minors, and replace it with a system in which prosecutors could request a genuine lifetime sentence. Under Senate Bill 319, if this request was not made or was denied, a judge would have to impose a minimum sentence of between 25 and 40 years, with a maximum of at least 60 years. These provisions would only apply prospectively, to cases still open as of the U.S. Supreme Court's Miller v. Alabama decision in June 2012.
Senate Bill 146, Extend enterprise zone tax breaks to a particular development: Passed 32 to 4 in the Senate
To revise a law that authorizes tax breaks for property owners in a “neighborhood enterprise zone” in a way that will allow granting these tax breaks retroactively to a particular developer's project.
House Bill 4353, Mandate schools have "EpiPens": Passed 96 to 10 in the House
To mandate that public schools must have at least two staffers who are trained in the administration of an epinephrine auto injector, and at least two of these "EpiPens" on site. This is a syringe prefilled with epinephrine that is used to treat anaphylactic reactions. This bill and House Bill 4352 extend legal immunity to school districts, boards, officials, staff and pharmacists for harm arising from use of the devices, except for gross negligence.
House Bill 4327, Allow reset of "tax increment finance" schemes: Passed 86 to 21 in the House
To allow "corridor improvement authorities" to "reset" their tax increment financing schemes (TIF) to reflect declining property assessments, which undermine their ability to divert property tax revenue from local governments and other taxing units to pay for the authority’s debt-funded spending projects and subsidies. A TIF "captures" the extra local property tax revenue that supposedly will result from these projects; this revenue is then used to repay money borrowed to fund that spending. The bill allows these authorities to change the base year from which future tax revenue increases ("increments") are measured.
Senate Bill 89, Vehicle trade-in "sales tax on the difference" only: Passed 99 to 9 in the House
To exempt from sales tax the value of a trade-in when buying a new motor vehicle, titled watercraft or recreational vehicle, but phase this tax break in over 24 years. This is the companion bill to House Bill 4234, described more fully above.
SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit: http://www.MichiganVotes.org.
Union right-to-work myths dispelled
The UAW has put together a flier on right-to-work "facts" that it is handing out to union members. The pamphlet's facts are wrong.
I'll stay away from some of the statements that are more nuanced — for example, the UAW says the law requires them to provide services for all employees in a union shop, but neglects to mention that they fought to make that the law to increase bargaining power. Instead, I'll focus on the figures that are demonstrably untrue.
Claim: "Workers in free bargaining states make on average an astounding $6,590 or 17% more annually than their counterparts in right to work for less states."
Fact: Unions and others on the left cannot make up their mind on what numbers to use. Other anti-right-to-work groups list the number at $1,500 per year. Some of this is simply by using old data; since right-to-work states are growing faster in people, jobs and income than forced unionization states, especially during the recent recession. The former has caught up to the latter.
In any case, accounting for the cost of living in every state shows that right-to-work states have 4.1 percent higher incomes than non-right-to-work states. Right-to-work states also have 14 percent higher incomes adjusted for cost of living than Michigan.
Claim: "Workers are less safe in right-to-work states."
Fact: According to the Bureau of Labor Statistics, employees in right-to-work states have a slightly lower injury rate and a slightly higher fatalities rate. In truth, there is no correlation between a state's unionization rate and safety. Federal laws regulate all workers. Workplace deaths are extremely rare and have more to do with what industries take place in a given state. Deaths are concentrated in areas like farming, fishing and forestry, which is irrelevant to union status. Oklahoma became a right-to-work state in 2001, and from 2000 to 2010 its workplace injury rate decreased nearly 40 percent.
Claim: "States becoming right-to-work leads to more poverty and less health care."
Fact: There is no evidence of this. The trends in poverty have been close for each batch of states: poverty in forced unionization increased slightly more over the past decade and in Michigan it increased the most of all states. The number of people without health insurance also was similar: the number of uninsured in right-to-work states increased slightly more than in forced unionization states. It is unlikely that a state's right-to-work status has much to do with this.
Claim: "Education is more of a priority in free bargaining states and right-to-work states have lower test scores."
Fact: Even the liberal Politifact rates this claim as "false." During fights over union issues, the Michigan Education Association and the Democratic Party in Wisconsin both made similar claims and both were forced to remove the information from their websites. There is a lot that goes into student test scores such as the socioeconomic background of students and whether the teacher is or is not in a union is not one of them.
The flier also gets the number of right-to-work states incorrect. Michigan and Indiana have joined the pack, but the union flier does not account for this.
Debates about public policy are good, and it is nice that the union is striving to prove its value to membership now that those workers have the freedom to choose whether they want to belong. But factual debates will help people make better decisions.
'They're a $100 million-a-year bully'
Patrick Wright, director of the Mackinac Center Legal Foundation, was a guest this morning on “Current State” on WKAR public radio discussing the unfair labor practice complaints the MCLF has filed on behalf of teachers against the Michigan Education Association.
Wright explained that the union has threatened to ruin the credit ratings of teachers who want to exercise their worker freedom rights and opt out of the union immediately. The MEA further insists that the teachers must continue paying dues and can only resign during the month of August.
Wright said the MEA has “chosen power over principle, money over their membership and cash over colleagues.”
Local governments object to transparency initiatives
Executive Vice President Mike Reitz told The Detroit News that “Any reform bill on FOIA faces a buzz saw of opposition from local government entities,” for a recent story about the lack of transparency at all levels of government.
Reitz has written previously about transparency and was the architect of a series of town hall meetings the Center hosted over the summer in conjunction with the ACLU and Michigan Press Association discussing Michigan’s Freedom of Information Act.