Government Is Not a Jobs Bank

Gov. Rick Snyder unveiled a 21-page Michigan “Citizen’s Guide” yesterday that shows public employee compensation levels here have grown to nearly twice those of the private sector, and that this disparity has increased over the past decade.

In addition, Gov. Snyder's commitment to an overhaul of the state’s business tax with a net tax cut will require reductions in government and public school spending, most which goes to employee salaries and benefits.

The new guide echoes work published by the Mackinac Center’s James Hohman, who pegs the statewide gap between private-sector and public-sector employee fringe benefits at $5.7 billion annually. Eliminating this imbalance would allow Michigan to completely eliminate its business tax, balance the budget, fix the roads and have money left over.

But government employee unions won’t give up those benefits without a fight. According to  MIRS News (subscription required), they have dismissed the Snyder guide as “comparing apples to creamed corn” because it fails to adjust for government workers’ higher education levels.

"If we intend to rebuild Michigan by bringing in the best and brightest to repair our roads, to teach our kids, to clean our environment, and to run our governments, you don't do that by reducing pay and reducing benefits," said American Federation of Teachers Michigan President David Hecker.

There are many flaws in the these arguments, but the most notable is the notion that Michigan taxpayers have a duty to provide a “jobs bank” to support union demands. State employee compensation has risen 46 percent over the past decade even as their numbers fell, costing  taxpayers here an additional $800 million every year. Yet few would argue that services have improved 46 percent since 2001. The cost of local government and public school employees has also risen sharply, while there are fewer students and test scores have stagnated.

So, do any Michigan taxpayers believe they are getting 46 percent better state service than in 2001? School costs have also increased, but are schools better? How about roads? State parks?

Regardless of what the public employee unions believe they are entitled to, Michigan taxpayers and businesses are not getting better service despite paying higher costs. The purpose of government is to provide necessary services for the least cost, not provide a jobs program and wealth transfer from the people to public employees and their unions.

Syndicated columnist Linda Bowles once wrote, "The task of weaning various people and groups from the national nipple will not be easy. The sound of whines, bawls, screams and invective will fill the air as the agony of withdrawal pangs finds voice."

The noise-making is well underway in Michigan.

Permission to reprint this blog post in whole or in part is hereby granted, provided that the author (or authors) and the Mackinac Center for Public Policy are properly cited.