Now go away
Two personal income tax elimination bills are apparently in the offing on the Senate and House sides of the Legislature. Both call (ultimately) for the wholesale elimination of the state’s personal income tax, born in Michigan 50 years ago, this Oct. 1.
The first proposal (not yet introduced) is being floated by Sen. Jack Brandenburg. His offer would also reportedly come with offsetting tax increases (sales tax, for instance) elsewhere and spending cuts, too. It sounds like a net tax cut, effective immediately, but the devil will be in the details.
The second proposal, introduced by House Speaker Pro Tem Lee Chatfield, would roll back the personal income tax to 3.9 percent (from 4.25 percent) starting in 2018 and then reduce it each year by 0.1 percent until it was zero, which would take 39 years.
Both proposals have some pluses and minuses. Economists find sales taxes to be a more economically efficient way to fund the government, although they are also considered more regressive. But higher income taxes are known job killers. That’s especially true in multi-rate systems, which Michigan’s constitution thankfully bans.
Although his plan would only gradually reduce the state’s income tax, the first cut in Chatfield’s bill is significant. Michigan taxpayers are owed one. In 2007, Gov. Granholm and the Legislature promised taxpayers that the 11.5 personal income tax hike they imposed would only be temporary. It would be rolled back, they said, starting in 2011 at 4.35 percent until it got to 3.9 percent in 2015.The complete rollback never happened. Gov. Snyder (and a new Legislature) did not permit it. Today, that tax stands at 4.25 percent. There are other good reasons beyond fulfilling an overdue promise to cut taxes today.
The Brandenburg proposal eliminates the personal income tax more quickly. But some or even a majority of the revenues it raises will be offset by hiking other taxes, such as the sale tax. The Chatfield proposal, by contrast, does not call for higher taxes elsewhere and cuts income taxes after the initial drop to 3.9 percent over almost four decades.
I will believe that 39-year tax elimination happens when I see it. Like the income tax, I turn 50 this year too. Actuaries say it is unlikely I will live long enough to see this fulfilled, even if future lawmakers don’t stop cuts in their tracks.
While the 39-year phase out is well-intentioned, the previous two administrations both promised future tax cuts that never happened. The first was Gov. Engler’s promise to roll back the Single Business Tax by 0.1 percent per year over 23 years, starting in 2001. The second was Gov. Granholm’s 2007 promise mentioned above. Short of a constitutional amendment, it is simply impossible to bind future lawmakers to the promises of those no longer in office.
A better approach might be to cut personal income taxes and state spending deeper and faster than proposed and only then discuss phaseouts or a hike to the sales tax.
Critics might complain that there is nowhere in the state budget to cut spending and offset revenues lost from eliminating the personal income tax. But Mackinac Center experts and others have repeatedly offered ideas for saving billions and other reforms to state spending that would help lower the tax burden, invest in infrastructure and shore up pension liabilities, too.
You can review many of those ideas by clicking on the links below.
Some Budget Ideas for 2017 (2017)
State Budget Follies (2014)
Benefits in Balance (2011)
Mackinac’s CAP scores align with rigorous research findings
With the confirmation hearing for Betsy DeVos delayed until Jan. 17, the heated conversation has continued surrounding the state of Detroit charter schools and her work as an educational choice advocate.
The Manhattan Institute’s Max Eden and I debunked the “Wild West” myth of the Motor City’s educational landscape and clarified DeVos’ mainstream position on school accountability. Further, National Review’s Ramesh Ponnuru repeatedly has corrected The New York Times’ twisting of the best available research that highlights the benefits of Detroit charters. Ponnuru compared the journalistic malpractice to “a game of telephone being conducted by propagandists.”
According to the Times’ calculated descriptions of the highly regarded 2013 CREDO study, Detroit charters “often” perform as well as their district counterparts and “sometimes” more poorly. The truth is that the study found nearly half of charters helped students learn more in reading and math, and about the same number performed the same, while only a tiny number did worse.
The Mackinac Center recently released the latest version of the Public High School Context and Performance Report Card, assigning grades to schools based on multiple years of testing data that are adjusted for student poverty rates. Since low achievement scores at a school are strongly correlated with a high-poverty student population, it’s useful to take student poverty into account in comparing schools. A CAP score of 100 indicates a school performs as expected given the share of students in poverty. A higher score indicates that a school does better than what its demographic profile might predict.
A number of high-poverty schools with unremarkable test scores get higher marks on our report card by outpacing their peers. Higher CAP scores are garnered not only by Detroit Public Schools buildings with selective admissions policies, but also by some conventional schools like Davison Elementary and Charles Wright Academy. Such schools are especially noteworthy, since childhood poverty, especially of the extreme version often found in Detroit, pose extra challenges for educators.
DPS schools with higher CAP scores represent the exception, however. While the bottom 10 percent of schools statewide are assigned an F, fully half of the district’s schools received that grade. This finding is consistent with the repeated results of NAEP scores that place Detroit at the bottom of the nation. While a straightforward analysis of our CAP scores is not as rigorous as the widely regarded CREDO study, it does give us a glimpse into how well the city’s charter and district schools are doing.
When measured by the 2015 elementary and middle school report card as well as the 2016 high school report card, the 76 Detroit charter schools earned an average CAP score of 99.16, just below the expected performance level. Roughly 30 percent earned an A or B, in line with state averages, while nearly 40 percent received a D or F.
By contrast, every one of the failing schools taken over by the Education Achievement Authority got a failing score. The EAA is slated to shut down at the end of this school year.
When we take student poverty into account, Detroit charters are significantly overrepresented among the top 5 percent of schools statewide. But they also appear too often in the bottom third. Overall, the city’s charters perform solidly on average, but stand head and shoulders above district schools. These CAP score results fit well with the findings of the more rigorous CREDO research.
The Motor City presents an exceptionally difficult educational challenge. Significant improvement is needed in order to help lift many more kids from poverty to success. Charter schools have proved themselves to be much more part of the solution than part of the problem.
At Michigan Radio, columnist Jack Lessenberry thinks that new school employees should continue participating in the state’s grossly underfunded retirement system. It’s better for teachers to have an employer-sponsored pension income, he says, than employer-sponsored retirement savings accounts.
But the system he supports hurts the very people he thinks it helps.
It’s important to remember that public school employees must work for 10 years before they “vest,” or have a right to receive a pension. If they leave before then, they won’t get a pension. And roughly half of Michigan’s public school employees do just that. If, though, they had been in a 401(k)-style system, they would have built up savings they could take with them when they go. Add in investment earnings and the savings become larger. So which scenario is better for these teachers who leave before vesting: no retirement benefits, or a personal account with real dollars in it?
When it comes to funding the pension system, the state has had to make a number of assumptions, and it’s gotten many of them wrong. As a result, the system has only 60 cents for every dollar it is obligated to pay. Apply that gap to all the teachers and other school employees who are counting on a pension and you have a shortfall of $26.7 billion.
When an employer makes deposits into a well-run pension system, it is setting money aside for upcoming obligations. But with Michigan’s school pension system, 89 percent of the deposits simply pay down obligations already on the books. Instead of setting aside for the future, the system is trying to play catch-up.
The costs of having an underfunded pension system are real. Each year, schools have to pay more and more money for pensions. Schools had to put 13 percent of their payroll into the pension system in 2004; this year, it’s 37 percent. This skyrocketing cost is prompting districts to lay off teachers. Other teachers have kept their job but have endured pay freezes or even pay cuts. It’s all happening because the state is in effect taking money from today’s classroom to make up for failing to fully fund pensions yesterday.
Imagine what would happen if, every year, your employer put an amount equal to one-third your salary in a retirement savings account of your own. Even if you took the most cautious approach to investing that money, you would soon have a healthy nest egg.
Instead of having that happy scenario, though, Michigan’s school employees face something else. They are in a pension system so broken that it costs more than one-third of their salary — and it still can’t provide basic retirement benefits to more than half its members.
As I wrote in The Detroit News, “The problem with government pensions boils down to a simple issue: The state promises something now, but pays for it later.” The state either needs to fix its funding assumptions and put more cash in the retirement system or it needs to move to a system — the government equivalent of a 401(k) plan — that doesn’t allow it to defer retirement expenses. The current policy is hurting teachers and taxpayers alike.
Require a criminal conviction before taking people’s property
Lansing began 2017 on the right foot by enacting a law to make it easier for people to try to recover property seized through civil asset forfeiture, but the state should end the practice altogether.
Last week, the Mackinac Center for Public Policy and the ACLU of Michigan issued a joint press release applauding the Michigan Legislature and Gov. Rick Snyder for passing and signing into law House Bill 4629. The new law removes the requirement that people pay a bond equivalent to 10 percent of the value of the property seized through civil asset forfeiture if they want to try to get it back.
“This new law will further protect the constitutional rights of citizens,” said Jarrett Skorup, a policy analyst at the Mackinac Center. “But Michigan needs to do more. Twelve states require law enforcement to get a criminal conviction before forfeiting property and two – New Mexico and Nebraska – have banned civil forfeiture altogether.”
Skorup spoke with ABC 12 this week about the case of a Genesee County man whose property was seized by a Saginaw County detective in 2014.
“All we know is the police never pressed charges against him, never convicted him, yet they ended up with over $20,000 in cash and some of his property, and that should raise a lot of eyebrows for people,” Skorup said.
Now, a Saginaw County deputy is suing over the matter, saying the sheriff’s department retaliated against him after reporting the seized money was used for confidential informant drug buys.
Since 2015, the state of Michigan has passed several reforms to limit how police may seize property. The standard of evidence required to take property is now higher, and the process is more transparent.
“Previously, if they wanted to forfeit someone’s stuff, it was based on a very low standard of evidence, and they’ve raised that a little bit higher,” Skorup told WSJM. “However, they still aren’t requiring that someone be convicted of a crime in order to take their stuff and forfeit it over to the state.”
Skorup added that a number of incoming legislators are interested in further reforming Michigan’s civil forfeiture laws.
Read the full report at WSJM.
Watch ABC 12’s full coverage.
Read the full press release.
Read the Mackinac Center and ACLU’s report “Civil Forfeiture in Michigan: A Review and Recommendations for Reforms.”
How to preserve the distinction between society and government
The French have a term for the tendency of professionals to try to address every societal issue from the point of view of their own expertise while ignoring other options. They call it “déformation professionnelle.” As new legislators take their seats in Lansing as the Michigan Legislature begins its session, they must take care not to become victims of that professional deformation, lest they risk further damage to the balance between government and society.
It’s tempting for new legislators to try to solve problems, since the arguments in favor of action are so simple and common: They’ve been elected to make things happen. They’ve got immense power to be used for good. They know their intentions are positive. They’re listening to smart people and considering all sides. If they don’t fix it, who will?
That’s why the hardest thing for lawmakers to do is stop and say, “This certainly is a problem we need to address as a society, but it is not appropriate for us to try to solve it using the powers of government.” It’s tremendously tempting for them, with the best intentions, to fall into this “déformation professionnelle.” They then see every injustice as something to be righted by government, every injury as one to be healed by government and every problem as one to be solved by government. Inevitably, every success then becomes something from which government deserves its share to fund all those government interventions.
This is the fundamental truth that is threatened by even the most well-intentioned legislator: “Government” and “society” are not the same thing. Despite former Congressman Barney Frank’s infamous assertion that “Government is simply the name we give to the things we choose to do together,” the reality is that the most important parts of our lives such as family, faith, work and recreation are fundamentally collective activities that we “choose to do together” with as little involvement from government as possible. Moving outward from that core, as participants in larger societies, we’ve created large and complex mechanisms for working together and helping each other without government. Churches. Charities. Professional associations. Unions. Fraternal organizations. Service organizations. Foundations and other philanthropies. They’re all different ways for us to work together in a way that does not require the organizing – and distorting – hand of government.
The great French philosopher and economist Frédéric Bastiat memorably explained this distinction in 1850:
Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all. We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.
Why should we differentiate between a solution provided by government and one provided by civil society? Because through the process of solving one problem, government inherently creates another. As Mackinac Center President Emeritus Larry Reed explained in his famous Seven Principles of Sound Public Policy: “Government has nothing to give anybody except what it first takes from somebody, and a government that's big enough to give you everything you want is big enough to take away everything you've got.”
Our elected representatives in Lansing will be presented with a great many problems in this upcoming legislative session. Each will have an array of constituencies clamoring for a government-based “solution” that advances their special interests. In many cases, the people asking for help will truly need assistance and it will be the legislator’s job to decide whether the state government is the right mechanism to provide it. To be sure, some problems will require governmental action. But let us hope that these new legislators have the wisdom and courage to recognize the difference between the problems that they alone can solve, and those the rest of us can and should address together … without government’s deforming involvement.
Final post in a series analyzing changes to Michigan's utility laws
(This is the third article in a three part series that discusses major changes made by the Michigan Legislature to energy utility regulation in the state. Those changes are now enrolled in statute as Public Acts 341 and 342 of 201.)
In the closing days of the 2016 lame duck session, the Michigan Legislature passed two major bills altering the management of electric utilities and electricity generation in the state. The primary focus of the bills was to determine the best way to pay for the construction of new generation capacity, made necessary by the premature closure of coal-fueled generation across the state. The bills also dealt with the future of the state’s electricity choice program, which provides 10 percent of electricity generated in Michigan. Lastly, the bills dealt with renewable energy, including addressing concerns over the state’s “net metering” program and the expansion of the state’s Renewable Portfolio Standard.
Renewable Portfolio Standard
Legislators and environmental groups lauded the completion of the electric utility bills as a major win, claiming they would “save millions of dollars a year for Michigan residents” by forcing waste reduction and mandating the construction of new wind and solar energy capacity.
The final bills increased Michigan’s 10 percent RPS by 50 percent, meaning electricity providers will now be required to produce 15 percent of their electricity from renewable sources — primarily wind and solar — by the end of 2021. However, imposing this increase is a significant setback for electricity consumers in Michigan as mandates, in place of market options, restrict choice and impose the use of more expensive and less reliable energy options.
A 2015 Institute for Energy Research study applies directly to Michigan utility decisions to partially replace existing coal and nuclear plants with new wind generation. IER found that “on average, electricity from new wind resources is nearly four times more expensive than from existing nuclear and nearly three times more expensive than from existing coal. These are dramatic increases in the cost of generating electricity.”
The energy bills also rejected any immediate changes to the state’s net metering — now called “distributed generation” — programs, used by electricity customers with distributed generation systems, such as rooftop solar panels, on their home or business.
These customers are connected to the electricity grid and rely on it to purchase electricity from utilities when their generation system is not producing enough electricity for their needs and to sell electricity when they produce more electricity than they need. In most cases, those customers are paid the full retail rate for the electricity they sell back to the utilities. However, that retail rate covers the cost of electricity, as well as all the infrastructure associated with the grid — transmission lines, generation facilities, electrical poles, meters, etc.
The final language of the bills grandfathers existing net metering customers at their current compensation rates. But, the Michigan Public Service Commission was directed to “establish a nondiscriminatory, fair, and equitable grid charge to apply to customers who participated in a net metering or distributed generation program after the bill’s effective date.”
To do so, the MPSC must complete a cost-benefit analysis to assess the cost of providing the electrical grid infrastructure distributed generators use (at a subsidized rate, compared to other customers) against the benefits their additional energy provides to all electricity consumers. How rates will change for new distributed generators when the MPSC completes its study is currently unknown.
Critics of net metering programs see them as “cost-shifting” from the poor to the rich, as net metering participants typically must be financially secure enough to qualify to lease solar panels or to afford the costs of purchasing their own. Despite their relative financial security, they receive an indirect subsidy that is paid by all other electricity consumers. Net metering opponents believe that distributed generators should pay the full price for the infrastructure they rely on to access the electricity grid. Even if these net metering participants paid these infrastructure costs, they’d still benefit from generous federal and state subsidies that artificially reduce the cost of solar panels and other renewable energy generation.
Net metering supporters argue, however, that Michigan’s two large utilities — DTE and Consumer’s Energy — are government-privileged monopolies with near complete control of the state’s electricity markets. Therefore, the subsidies and higher net metering rates are an essential means of incentivizing a more diverse generation system. In other words, until Michigan’s electricity market is freed to open competition, net metering supporters maintain that these subsidies are justified and necessary.
Whichever side one chooses to take on the net metering issue, the reality is that heavy government involvement in, and regulation of, electricity markets has a substantial distorting effect on efficient energy generation and distribution. Special protections that are afforded to a select few utilities and distributed generators discourage diversification, innovation and customer-focused service.
Additionally, state renewable energy mandates and renewable portfolio standards put government in the role of selecting market winners and losers. They require that generation capacity rely on more expensive and less reliable energy sources, leaving Michiganders to foot higher bills for less effective electricity service.
Other sources for environmental clean-up eliminate need for further debt
Environmental lobbyists in Michigan are concerned that the money from the 1998 borrow-and-spend Clean Michigan Initiative is drying up. So they are warning that the state may no longer have money to clean up the environment.
But it is worthwhile to pause and consider a fuller picture before capitulating to demands that we spend more, or “do something.” In the case of the Clean Michigan Initiative, we are being told that a depleted CMI fund is keeping the director of the Michigan Department of Environmental Quality, Heidi Grether, up at night.
Both Grether and James Clift, policy director of the Michigan Environmental Council are reportedly concerned that if the funds are not replaced, “layoffs may occur in the DEQ’s remediation division” and the work to remediate contaminated sites will stall.
The notion of insufficient funding causing all environmental remediation around the state to grind to a halt may be a frightening concept. However, Michigan has numerous other funding sources available for the elimination of harmful pollution and protection of citizens and the environment. To the extent that there are other workable (and funded) options, taxpayers should be very concerned about going further into debt for this one cleanup initiative.
The 1998 Clean Michigan Initiative is not the only source of money available to pay for environmental cleanup. For example, taxpayers pay 0.875 cents per gallon of gasoline and on other “refined petroleum” fuels into a fund to pay for this service. So, every time Michiganders “fill-er-up” they are funding environmental restoration and remediation programs.
Likewise, when people throw their cans away instead of getting their deposit back, 60 percent of the leftover deposits go towards environmental cleanup programs. Both these sources will provide more dollars for cleanup than the Clean Michigan Initiative this year.
It’s also worthwhile for taxpayers to realize that the Clean Michigan Initiative is not even a source of money: taxpayers are. Voters approved up to $675 million in debt in 1998. According to the most recent state treasurer’s report, the state still owes $385 million to bondholders, and taxpayers are responsible for the principal and the interest on that debt.
That means that, in addition to fuel taxes and deposit fees, in 2017 Michiganders will pay $89 million on this debt from state general funds, the largest revenue source of those being the income tax. The state would have saved money by cutting out the borrowing and financing this program with direct expenditures. But to do that, government agencies would need to get repeated expenditures approved by elected officials, a much more involved and difficult process.
To make matters worse, not all of the cash from Clean Michigan has gone to cleanup. Much of the money was spent on other, less environmentally critical, items — tennis courts, swimming pools and “environmental education” programs. Governor Blanchard’s 1988 environmental borrowing also was approved for recreation grants.
The public may agree that new public swimming pools or school playgrounds are worthwhile investments, but they certainly are not the essential spending that was approved by voters to keep toxic waste from leaching into ground water resources.
Selling the program as essential to environmental protection, but then diverting funds for nonessential recreation projects ought to rile the people that are concerned about cleaning up harmful sites. It ought to rile all Michigan taxpayers. Unfortunately it is common.
There are resources available to handle environmental remediation already. We can manage this responsibility without going further into debt.
Ignorance of the law is no excuse for leaving running vehicle unattended, police chief says
A Roseville man named Taylor Nicholas Trupiano received a $128 ticket after he left his car running unattended in his girlfriend's driveway on Jan. 5. After starting the car and then heading inside, he came back a few minutes later to find he had been ticketed, but no police car was in sight. "Vehicle parked in drive at [street address] with keys in ignition, motor running - no one around," reads the ticket. Trupiano took to Facebook under the name “Nick Taylor” to vent his frustration, posting a photo of the ticket with a strongly-worded caption criticizing the officer who issued it.
Trupiano says he had left his car running while he stepped inside his girlfriend's house because it was very cold outside. Roseville police chief James Berlin said that leaving a vehicle running unattended violates a local ordinance. He said the behavior poses a threat to public safety. "You can't do it. You see it all the time, people hop in a running car and steal them. Something bad happens when that occurs," Berlin told Fox 2 Detroit (WJBK-TV).
Although there is no state law that prohibits leaving a running vehicle unattended, Berlin said five to 10 running and unattended cars are stolen in the city every year, driving up insurance costs and the crime rate. "It's common sense," he added. "We can't warn everybody of the law there is [sic]."
That’s true enough. The number of crimes on the books in Michigan is vast, and growing. A Mackinac Center study found that the Michigan penal code contains 918 sections and includes over 3,100 crimes - significantly more than that of neighboring states of Ohio, Illinois and Wisconsin.
And those are just the state laws. They do not include state or federal regulations and rules or city ordinances. Trupiano's ticket goes to show that Michiganders are still held to the "ignorance of the law is no excuse" principle, even though our lawmakers pass an average of 45 new criminal laws each year and repeal few, if any.
Michiganders probably commit crimes every day and don’t know it when they do. Trupiano should feel fortunate that he received only a civil infraction. At a 2015 panel discussion on "overcriminalization" featuring speakers from the ACLU of Michigan and the Mackinac Center, ACLU attorney Miriam Auckerman said that her organization was representing Michiganders who had received misdemeanor sentences and even done jail time for their inadvertent crimes.
One ALCU client was arrested for trespassing after he chatted in a private parking lot for three minutes. Two college students from Saugatuck did jail time for playing their instruments on the sidewalk. They had violated an ordinance, which they were completely unaware of, prohibiting the playing of music in public spaces.
The ACLU and the Mackinac Center began calling on the Legislature in 2013 to establish standards that would protect well-meaning people from criminal liability. In 2015, Gov. Rick Snyder signed a law that protects people from being convicted for activities that they did not know were illegal.
While this is an important step forward, it still leaves Michiganders with a massive, complex scheme of state laws, local ordinances, and administrative and environmental regulations. As Trupiano experienced and his viral Facebook post indicates, these rules may be counterintuitive and inconsistently enforced.
Having so many laws on the books leaves people vulnerable to discretionary governmental prosecution. It erodes respect for the rule of law. It takes a lot of taxpayer dollars to arrest, try and punish people for minor violations, and it diverts law enforcement, court and corrections resources away from truly blameworthy offenses.
Two federal proposals that avoid dangerous overreach
Betsy DeVos has already been the subject of much media scrutiny as a result of her nomination to be the next U.S. secretary of education. But the most significant test will come on Jan. 11, when the U.S. Senate will hold its confirmation hearing.
Critics have repeatedly missed the mark about the record of Michigan charter schools that DeVos’ high-profile policy advocacy has helped to shape. Meanwhile, supporters of school choice have speculated about what she could and should do in a federal cabinet role to advance educational choice and opportunity.
The prospects are especially tempting for school choice advocates in her home state, where a restrictive state constitution has limited opportunities for many families. But federal school choice strategies should be carefully thought out. Reformers need to remember that the struggle for educational freedom is a long-term one and recognize the dangers of each strategy they pursue.
On the campaign trail, President-elect Trump touted a loosely defined $20 billion federal school choice initiative. While some relish the chance to shake up the system, a massive, D.C.-directed voucher program could create real and serious harms. A heavily regulated choice program would force many high-quality private schools to shift their focus to compliance, to compromise their mission or to not participate. That result would not help students at all; worse, it would threaten state programs that are already working well.
Two federal reforms, though, could be helpful. These ideas, recommended by The Heritage Foundation, would shift power from bureaucrats to parents and could open the door to more choices, all without harmful side effects.
First, eliminate the current complex formulas for doling out federal Title I dollars intended to help low-income students. Instead, give these families the option to use their per-pupil share outside the confines of the public school establishment. The amount would not be large enough to pay for tuition at a new school, but it could help families buy specific courses, tutoring services or instructional materials that their children need.
Second, let 529 college savings accounts cover K-12 expenses. All students could benefit by having more ways to develop their education before and during their college years. This could be accomplished by small changes in the law, first at the national and then at the state level.
Our state’s version of the 529, the Michigan Education Savings Program, helps taxpayers by letting them claim an income tax deduction for contributions they make to a personal education account (up to $5,000 for a person and $10,000 for a family). Businesses, charitable organizations and government agencies already can open accounts in a child’s name, which could be especially useful for kids from low-income families.
These two separate proposals, one using public funds and the other offering incentives for private contributions, would give Michigan families more control over their children’s education. And neither would carry the huge risk of a large-scale federally funded voucher program.
Bluegrass State first of several likely to pass such legislation in 2017
The Mackinac Center for Public Policy congratulates the commonwealth of Kentucky, which became the nation’s 27th right-to-work state over the weekend.
Kentucky Gov. Matt Bevin, a Republican, signed the legislation Saturday after it sailed through the legislature during the week. Once the law takes effect, unions will no longer be able to have workers in the Bluegrass State fired for not paying them dues.
In addition to enjoying more freedom, Kentuckians should expect an improved economy, higher wages and more jobs as a result of right-to-work. Jim Waters, president of the Bluegrass Institute for Public Policy Solutions, wrote an article for The Richmond Register about the positive effects right-to-work has had on states that recently enacted it. He cited the Mackinac Center’s Director of Labor Policy F. Vincent Vernuccio:
Vincent Vernuccio of the Michigan-based Mackinac Center for Public Policy found:
- Average wages in both Indiana and Michigan increased after right-to-work laws were passed.
- Since Indiana became a right-to-work state in 2012, its average wage rose faster than West Virginia’s.
- Between 2012 — when Michigan passed its right-to-work law — and mid-2015, incomes in Michigan rose more than 9 percent, which was faster than both West Virginia and the national average.
- Between 2012 and 2014, average hourly wages rose by 56 cents to $19.94 in Indiana, 56 cents to $21.70 in Michigan but only 37 cents to $18.21 in West Virginia.
Voters in new right-to-work states have rewarded lawmakers who supported the change, Vernuccio told The Wall Street Journal. “The union’s bark is a lot worse than its bite when it comes to the election afterward,” he said.
He noted that after Michigan enacted right-to-work in 2012, the issue wasn’t a significant factor in Republican Gov. Rick Snyder’s 2014 re-election, and no Republicans who voted for the bill lost in the general election that year.
Kentucky could be the first of several states to pass right-to-work legislation this year, Vernuccio told The Huffington Post. “We may see up to 29 [states] before the spring,” Vernuccio said. “You’re definitely seeing a snowball effect, and more and more states are looking to give workers freedom.”
Missouri and New Hampshire are the next states likely to consider such legislation.
Read the full article in The Richmond Register.
Read the full article in The Huffington Post.