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During the campaign, incoming Gov. Gretchen Whitmer pledged to fix the roads in the state. She also pushed back on some of the major reforms of the past few years. She wants people to be fired if their workplace is unionized and they choose not to contribute to the union. In other words, to repeal right-to-work. She wants to increase the costs of government construction projects. In other words, to reinstate the prevailing wage laws. But these are good reforms that help the people in the state and deserve to remain. The Mackinac Center made a strong effort to educate lawmakers about the benefits of both reforms. But they will only remain if people want them to be around, so we’ll get a chance to see how popular they are.
Both laws ensure that unions are voluntary institutions. Right-to-work allows people to opt out of an organization that they don’t want to support. Prevailing wage requirements weight the bidding for government construction projects to union vendors, which prevents public servants from giving the public the best deal.
Right-to-work changes how unions treat their members. If unions can take their members’ financial support for granted, they are less likely to act in their members’ best interest. The fact that unions could have taken members’ financial support for granted may have explained why they have tended to be ideological and partisan in ways that their members are not. A change to unions’ incentives encourages them to represent their members and to work with employers for mutual gain. This can have economic impacts on the whole state and help right-to-work states have faster growth in population, income and employment.
Regarding prevailing wages, the public benefits most when government contracts go to the best vendor with the best price. Deciding on the right vendor can get complicated, but politics complicates it even more. Politicians don’t just want buildings to be built, they want other social ends to be served in their construction. They may want only environmentally friendly buildings to be built, for instance. Prevailing wage policies are like that. They require union-scale wages for individuals who work on government construction projects: We don’t want to build buildings, we want to build buildings with union labor. This is good for union construction workers and bad for taxpayers.
So prevailing wage laws transfer wealth from the public to those working on government construction projects. The public doesn’t get anything in return for that generosity. It’s a bold transfer of wealth and getting rid of it will stretch taxpayer dollars further. The savings will become more obvious as the economy expands and state and local governments construct more things.
Laws, such as ones on union membership or the prevailing wage, can concentrate benefits to some groups at the public’s expense. This happens all around the country. One of the Mackinac Center’s important functions is to help lawmakers get rid of these kind of laws. And we do this by fostering a climate of public opinion that makes it unpopular to provide private benefits at public expense.
So when new policymakers are elected, we get a test of popular sentiment. New public officials have likes and dislikes that differ from those of the people they replace. Yet they are still elected representatives of the state’s residents and are ultimately subject to what they want. Policy changes only last as long as they are popular. We’re going to see how good of a job we’ve done.
