The Mackinac Center for Public Policy recently published “Proposal 1 of 2012: The Referendum on Public Act 4,” which addresses Proposal 1 on the Nov. 6, 2012 ballot, also referred to as the “emergency manager” referendum.
The study examines the claim that local control will diminish if Proposal 1 passes and Public Act 4 is nullified. Public Act 4 had provided expanded powers to state-appointed emergency managers of local governments and school districts that are in a state of serious “fiscal stress or “fiscal emergency.” The study determined that the question in Michigan has not been whether state-appointed managers or court-appointed receivers may replace local elected officials in running a local unit of government; they have been able to do so for decades. The only question is whether state government will participate in the effort to avoid local fiscal insolvency and how it will do so.
The Policy Brief was authored by James M. Hohman, assistant director of Fiscal Policy for the Mackinac Center for Public Policy.  … more

The Mackinac Center for Public Policy recently published “Proposal 2 of 2012: An Assessment,” which addresses Proposal 2 on the Nov. 6, 2012 ballot, also referred to as the “collective bargaining” amendment.
The study examines how the proposed constitutional amendment would enshrine collective bargaining in the state constitution, which would allow government union collective bargaining agreements to invalidate numerous state laws meant to improve the quality of public services and would likely negate a projected $1.6 billion in annual taxpayer savings.
The Policy Brief was co-authored by Vernuccio and other Mackinac Center analysts: Senior Legal Analyst Patrick J. Wright, Executive Vice President Michael J. Reitz and Assistant Fiscal Policy Director James M. Hohman. Also co-authoring was Paul Kersey, director of labor policy at the Illinois Policy Institute. … more

According to the U.S. Food and Drug Administration, the number of times drugs were in short supply almost tripled from 61 in 2005 to 178 in 2010. The figure reached more than 250 in 2011. This means that manufacturers reported to the FDA that they were unable to meet demand for the drugs. Hospital and health-system pharmacists, as well as oncologists, anesthesiologists and other specialists have also increasingly reported difficulties acquiring drugs.

These are mostly injectable drugs for cancer and other important therapies, and they are frequently produced by generic drugmakers. These drugs are not dispensed by community pharmacies, but rather administered by health professionals in clinical settings.
Currently proposed solutions are unlikely to address the crisis satisfactorily. Congress appears ready to give more power to the FDA, but making FDA regulations more onerous will not alleviate the current shortage of crucial medicines.
A more promising approach is to make it easier for competitors to enter the market in response to forthcoming shortages. In general, this means reducing and ultimately removing the FDA’s monopoly on the approval of drugs for medical use. Shifting these medicines to Medicare Part D insurance may also stabilize supply by helping ensure manufacturers receive adequate compensation for the medicine, even as taxpayers are protected from escalating costs. … more

In this first installment of the Mackinac Center for Public Policy's new "Schools of Innovation" series, we begin with Oxford Community Schools' experiment with virtual learning. This study examines the district's adoption of Web-based learning to deliver and enhance student instruction. The effectiveness of virtual learning and the resulting increase in district enrollment have fueled the expansion of other school programs — a marked contrast to the many Michigan school districts that have struggled to maintain their offerings during the state's economic slump. … more

This booklet contains the Mackinac Center Legal Foundation’s final legal filing in a nationally known case involving the illegal unionization of Michigan’s home-based day care business owners and providers as government employees. Wright argued the case in the Michigan courts on behalf of Sherry Loar, Michelle Berry and Paulette Silverson, who each own home-based day care businesses.
The Mackinac Center Legal Foundation sued to end the DHS' illegal diversion of so-called "union dues" from state subsidy checks received by home-based day care providers who watch children from low-income families. The "dues" were funneled to a government-employee union that purports to represent more than 40,000 of Michigan's home-based day care providers, who are actually private business owners and independent contractors.
The case was ruled moot by the Michigan Supreme Court after the DHS ceased to collect the dues and the DHS director stated that these home-based day care providers are not public employees. … more

Since March 31, 1997, new state employees who qualify for the Michigan State Employees’ Retirement System have been placed in a 401(k)-style “defined-contribution” retirement plan, rather than MSERS’ traditional “defined-benefit” pension plan. Under the new arrangement, state government makes mandatory contributions to employees’ individual retirement savings accounts, but does not guarantee employees a defined retirement income, as it did under the traditional plan.
In this Policy Brief, the author analyzes state pension data to determine whether state taxpayers have saved money as a result of the switch. … more

Michigan’s Public Employment Relations Act requires local governments and school districts throughout Michigan to bargain collectively with unions representing their employees. The collective bargaining process is a creation of the state Legislature, which also has the power to repeal or amend it.

No area of public policy in Michigan is more in need of fresh thinking than the relationship between government and its employees. With Michigan’s recurring government budget struggles, and with a new Legislature and governor espousing a commitment to performance, efficiency and accountability in government, a new labor law for government employees is imperative.

This report outlines a variety of ways the Michigan Legislature can address the damaging impact of PERA. … more

Virtual learning doesn’t just involve using computers at school; it involves a new method of instructing students. Virtual instruction is provided by teachers working remotely or by specially designed software — or both — and delivered to students through computers or the Internet. In some cases, supplementary instruction might be provided by a local teacher, but the essence of virtual learning is that students no longer need to share a classroom with a teacher to learn.
Virtual learning is not for every student, but it’s not science fiction, either. Right now in Michigan, it’s being used by thousands of students in hundreds of virtual courses in urban, rural and suburban school districts. In fact, Michigan has been seen as a national leader in virtual learning.
This study analyzes the financial costs and academic benefits of virtual learning, and it explores how this innovation could further benefit Michigan public school students. … more

Michigan’s state-run school system is the largest and most expensive government service taxpayers support. It employs more than 350,000 people who work in one of the more than 4,100 different entities. The total amount this system expends each year adds up to more than $20 billion. Given the enormity and complexity of the system, it’s no surprise that a number of myths exist about how public schools are funded. … more

Privatization of support services has been a method that Michigan school districts have used for several years to lower costs. More than ever before, Michigan school districts are privatizing the three main support services they offer — food, custodial and transportation. Our annual survey finds that 48.8 percent of Michigan school districts are contracting out for these services. This is an 8 percent increase over 2009.

The largest impetus for contracting is cost savings. The survey found that first-year contracts alone are expected to save districts $16.7 million cumulatively. … more

Michigan auto insurance premiums are among the highest in the nation. The American Association of Retired Persons, in a recent survey, found that Michigan’s premiums were the second highest in the nation, behind only Louisiana. This, combined with a statutory requirement to purchase insurance, has led to legislative attempts to keep premiums down. Unfortunately, state lawmakers have pursued an approach that includes price controls, regulation of how premiums may be set, and requirements for insurance companies to provide specific types of coverage. As the famous Austrian economist Ludwig von Mises pointed out decades ago, this kind of government intervention, while well-intended, leads to unintended consequences that then lead to further government interventions, further unintended consequences, in a lengthy cycle with results that no legislator would have expected at the beginning.
Rather than attempting to regulate insurance company and individual behavior, Michigan legislators would much better serve the people they represent by examining why insurance premiums are so high in the first place, in order to address the problem at its source. A careful study of Michigan’s insurance market and the regulations governing it indicates that no-fault insurance and the legislative requirement for individuals to purchase unlimited personal injury protection are two important reasons for the increased costs of providing insurance coverage in Michigan. The good news is that it is possible to reduce these costs and reduce the number of drivers who take the risk of violating the law and do not purchase insurance. … more

Just what constitutes a public record? Are documents created by a public official on a public computer system “public records” under Michigan's Freedom of Information Act? In this "friend of the court" brief, Mackinac Senior Legal Analyst Patrick J. Wright argues the answer is “yes” and warns that a failure to readily disclose such documents would seriously undermine FOIA's value. … more

Video by Kathy Hoesktra, Mackinac Center communications specialist … more

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A guide to labor law for charter school staff. This 105-page book explains how Michigan's labor law works and in particular how and why unions are formed. The book also gives advice on how charter schools can maintain good relations between teachers and administrators. … more

In this study, the authors consider cigarette smuggling from two angles. First, they employ a statistical model to estimate the degree to which cigarette smuggling occurs in 47 of the 48 contiguous U.S. states. Second, they review the historical experiences of three states — Michigan, New Jersey and California — known to have problems with cigarette smuggling. The author's findings suggest that state policymakers should reassess the value of cigarette taxes as a revenue and public health tool. … more

While it is true that Michigan students learn a variety of skills in their time at school, perhaps the most important charge of public schools, beyond providing a safe and healthy environment, is to ensure that students are learning "the three R’s." Unfortunately, the achievement levels of Michigan public school students raise doubts about the quality of public education in the state. This volume has been written to assist local and state policymakers who want to initiate and support teacher quality reforms to improve Michigan's primary and secondary schools. … more

More than a dozen bills are pending in the Michigan Legislature to expand regulation of the electricity industry and to impose new environmental requirements on energy production and sales. As a group, these legislative proposals assume the necessity of government intervention in the production and distribution of energy. This report details the drawbacks for consumers and the economy of substituting political forces for market forces in electricity service. … more

Remarkable advances in analytical chemistry now make it possible to measure minute levels of both natural and synthetic compounds in human tissue and body fluids. This “biomonitoring” allows researchers to determine more precisely than ever the degree to which individuals have been exposed to specific chemicals in the environment, and how exposures change over time. Consequently, federal and state officials increasingly regard biomonitoring as a potential new underpinning of environmental and public health regulations. … more

The Mackinac Center for Public Policy has regularly recommended specific state spending reductions to balance the state’s budget and improve Michigan’s public policy. The following list shows how the state could reduce spending immediately to help balance the state budget if policymakers chose to forgo the projected $1.358 billion in fiscal 2008 revenue from the recent state income tax hike and the new sales tax on certain services. … more

This policy brief discusses several foundational legal concepts and sets forth model language for a legally sound right-to-work amendment to the Michigan Constitution. … more

Michigan’s prevailing wage law adds unnecessary costs to construction projects at taxpayers’ expense. … more

On April 17, 2006, Michigan Gov. Jennifer Granholm directed the Department of Environmental Quality to draft a rule under the state’s Clean Air Act to reduce mercury emissions from coal-fired power plants by 90 percent. The governor ordered the reductions to occur in two phases. The first phase is supposed to entail the reduction schedule established by the U.S. Environmental Protection Agency last year. The second phase is supposed to exceed the federal requirements by reducing emissions 90 percent by the year 2015. … more

The Mackinac Center for Public Policy worked on this survey project from November 2005 through September 2006. We provided assistance to the survey researcher, Adam B. Schaeffer, who was then a National Research Initiative Fellow at the American Enterprise Institute in Washington, D.C., by collaborating on the survey instrument, offering relevant and limited information from our database, handling technical details of inviting and following up with participants, and editing and publishing this document. … more

Advances in technology now make it possible for both cable firms and telecommunications companies to provide voice, data and video services to most homes and businesses. This constitutes a dramatic change from the days of cable dominance in the video market, and that of the “Baby Bells” in telephone service. What hasn’t changed, however, is the franchise regime that has long limited access to the local market and thus inhibited competition. In this paper, Diane S. Katz examines the effects of this obsolete regulation on consumers and the economy, as well as the myriad benefits of reform. … more

A Mackinac Center “friend of the court” filing to the Michigan Supreme Court in a case involving the Michigan Public Service Commission’s renewable-energy surcharge on electrical bills. … more

A Mackinac Center “friend of the court” filing to the U.S. Supreme Court in two cases involving federal wetlands regulation of Michigan properties. … more

April 18, 2005 marks the 10th anniversary of The Michigan Economic Growth Authority, a program established by Michigan government with the mission of spurring in-state job creation and business investment. The authority is the state of Michigan’s agent for selecting firms to receive Single Business Tax credits in return for creating new facilities and jobs in Michigan. … more

Zogby International and the Mackinac Center for Public Policy undertook a nationwide survey of union members to determine their views of their unions’ performance. We asked union members about union effectiveness, union responsibilities, union political spending, ways for workers to create a union and how unions should treat workers. … more

Ending the regional monopoly structure in the generation of electricity was intended to provide customers with lower rates and improved service quality, while also increasing generating capacity for electricity in the state. But attempts are underway to reverse the course of this restructuring. … more

Can the School Choice Community Come Together on an Explicit Goal and a Plan for Achieving It? … more

Michigan’s principal land preservation program has failed to achieve its goals. … more

Gov. Granholm and the Michigan Legislature can save $34 million in the state agriculture budget, and sell state land for another $59 million. … more

An Examination of the Goals, Results and Fiscal Consequences of Michigan's Most Ambitious Environmental Bond Program … more

The right to decide for yourself whether or not to support a union in your workplace: union officials dismiss it as "the right to starve", but for the last thirty years Right-to-Work states have been outperforming compuslory unionism states such as Michigan. This report demonstrates how individual freedom and higher productivity give workers in Right-to-Work states the edge in job opportunities, employment, and purchasing power. … more

Unions in Michigan represent over 900,000 workers and take in more than $250 million in membership dues annually. But in spite of their expansive wealth and political power, requirements that unions disclose their financial dealings are minimal. Reform of the federal reporting system, which governs private-sector unions, is needed but unlikely in the current political climate. Michigan can take the lead by passing its own Union Accountability Act, requiring annual financial disclosure reports and independent audits of public-sector union affiliates active in the Great Lakes State. … more

More than a third of Michigan students leave high school without possessing basic academic skills including reading, writing, and arithmetic. This forces employers and post-secondary schools to take up the slack. This study conservatively estimates that Michigan businesses and institutions of higher education spend over $600 million annually to teach employees and students skills they should have learned in high school. The comparable national figure is $16.6 billion, but the human costs of K-12 educational failure are incalculable, according to experts' essays included in the study's appendices. … more

Many employees in unionized workplaces do not know that if they harbor religious objections to joining, financing, or otherwise associating with labor unions, they have legal recourse if their union or employer or both violate those rights. This report explains the statutes and developing case law that protect religious employees' freedom of conscience in the workplace by allowing them to refrain from union membership and divert their compulsory dues to a charity of their choice. … more

Has the growth of tax-free Internet sales hurt state revenues or education funding? Is it "unfair" for sales over the Internet not to be taxed while other sales are taxed? Would imposing new taxes on the Internet do serious damage to the ability of this new form of commerce to thrive? Does the growth of tax-free online shopping pose a threat to traditional "bricks-and-mortar" retailers? This study addresses these and other questions in order to provide state, local, and federal policy-makers with the intellectual and empirical ammunition they need to keep the taxman at bay. … more

The Internet has transformed our way of life; and new "broadband" technologies promise even greater benefits through high-speed Internet access and communications. Unfortunately, because major cable companies currently have the capacity to provide this technology to their clients, other Internet service providers (ISPs) are crying foul. They are calling the cable companies' "head start" unfair and forming alliances to get the government to force cable companies to make their high-speed broadband lines available for use by all ISPs on equal terms. This study explains why this government intervention would be a terrible idea. It analyzes market trends and technological possibilities to show that "forced access" would significantly increase costs for consumers with no benefit to show for the added expense. The study concludes that "forced access" would stifle the innovation that naturally emerges from the free play of market forces. It shows why government should not only refrain from interfering with broadband technology, but should allow competition between local cable providers in order to maximize the potential of this exciting new technology. … more

Michigan is one of the most unionized states in the country, with a long and sometimes troubled labor history that powerfully affects every citizen in the state from blue-collar factory workers to suburban soccer moms. Yet few understand how modern labor unions and state and federal labor laws operate. This study clearly and concisely explains the history of organized labor in America, how government unions affect the democratic process, how compulsory unionism interferes with workers' rights of free speech and association, and much more. Several recommendations for reform point the way toward restoring a more balanced, government-neutral approach to Michigan labor relations. … more