Lou Schimmel, former director of municipal finance and an adjunct scholar with the Center, has been hired for his expertise to solve the city of Warren's $10 million overspending crisis.
The Detroit Free Press reports that Schimmel has been named Warren's executive administrator. He previously was appointed receiver for the city of Ecorse, eliminating that city's $6 million overspending crisis by renegotiating union contracts and privatizing many services. He's also the former emergency financial manager for the city of Hamtramck.
Henry Payne, editorial cartoonist for The Detroit News, writes about the Mackinac Center's climate change panel, in which he participated, at National Review Online.
You can watch the event here.
A Detroit News editorial today calls a plan to cap salaries of public school superintendents and teachers based on what politicians are paid, "gimmicky," and cites this commentary by Mike Van Beek, director of education policy, which states that only 1 percent of school expenses go toward superintendent pay and benefits.
More Michigan public school districts are posting their checkbook registers online as a way for taxpayers to see exactly how their money is spent, but most districts get a failing grade when it comes to transparency.
"After two years, we know who cares most about telling the taxpayers where their money goes," Ken Braun, director of the Center's "Show Michigan the Money" project, is quoted in today's Grand Rapids Press. "All of the 'A' students in the transparency class have been identified, and the rest are apparently celebrating Sunshine Week 2010 by skipping class," Braun continued.
The Michigan Economic Growth Authority yesterday approved its latest batch of tax credits to lure large business projects to Michigan.
Despite the press release, these big business projects are just not that consequential to Michigan's total economy.
That's because the state's economic development programs are involved in the bulk of business news stories, but an incredible minority of the state's job creation.
The Associated Press is reporting that a convicted embezzler currently on parole has been approved for business tax credits under the state's Michigan Economic Growth Authority program. The article also noted that when the deal was announced, the embezzler, Richard A. Short, "shared the stage" with Gov. Jennifer Granholm.
Nearly every aspect of a teacher's job falls under the rules of a union contract. The following is a synopsis of just one of those agreements in Michigan. It comes from Western School District near Jackson, which employs 180 teachers and enrolls 2,900 students. Of its $22 million operating budget (excluding capital expenditures and debt services), 90 percent goes to pay employee compensation.
For your edification, from the U.S. Department of Labor, Office of Labor-Management Standards come the following updates on union corruption investigations in Michigan:
On March 8, 2010, in the United States District Court for the Western District of Michigan, David Miller, former Treasurer of Litchfield Independent Workers Union Local 373 (located in Litchfield, Mich.), pled guilty to one count of embezzling union funds in the amount of $50,501.99. On January 6, 2010, Miller was indicted on one count of embezzling union funds in the same amount. The plea follows an investigation by the OLMS Detroit District Office.
The Michigan Information & Research Service (subscription required) reprinted this blog post by Paul Kersey, labor policy director, explaining why it would not be a violation of labor law for the Legislature to reject a 3 percent raise for state employees as some lawmakers claimed.
Senate Bill 1148, introduced recently by Sen. Bruce Patterson, R-Canton, would limit the total compensation of public school superintendents to 75 percent of what the governor is paid and prohibit districts from paying any teacher more than what a state legislator makes.
Last Wednesday Teamsters President James P. Hoffa offered his unsolicited advice to the Tea Party movement. In an article that is cleverer than usual for union officials, it’s worth taking time to note what Hoffa avoids, because the whole thing is basically an exercise in deflection.
Another lawmaker has put his support behind legislation that would end the stealth unionization of small-business owners.
Livingston County's Sen. Valde Garcia, R-Marion Township, is co-sponsoring the package of bills, according to radio station WHMI. Patrick Wright, director of the Mackinac Center Legal Foundation, testified in support of the legislation earlier this week.
Research by James Hohman, fiscal policy analyst, shows that claims of Michigan experiencing a "brain drain" are not true.
"It's been one of the most over-hyped myths that's been out there," Hohman told the Michigan Information & Research Service (subscription required). "The simple truth is that these young people are already high mobile, even in a good economy, and that even in Michigan's ongoing bad times, we're actually doing pretty well in attracting graduates to the state."
A Michigan congressman wants to repeal legislation that has been one of the few bright spots in the state's slumping economy over the last decade.
Rep. Bart Stupak, D-Menominee, has introduced legislation to overturn the North American Free Trade Agreement, according to The Flint Journal.
The state higher-education establishment and its lobbyists argue that spending more tax dollars on their system will improve Michigan's economy.
Here is the abstract from the very latest research on this issue, performed not by self-serving beneficiaries of government spending, but by disinterested scholars:
Mackinac Center Legal Foundation Director Patrick Wright testified Tuesday on proposed legislation that would end the stealth unionization of home-based day care owners and prevent the same thing from happening to home health care workers.
Lansing political newsletters Gongwer News Service and the Michigan Information & Research Service (subscriptions required for both) covered the hearing. Wright told the Senate Families and Human Services Committee that because "union dues" are taken out of the subsidy checks day care owners receive on behalf of low-income parents, it raises the question if other professions could be organized just because their clients receive government assistance — such as pharmacists. Wright in the past has raised the same concern about doctors, landlords and grocers.
Michigan legislators who might consider borrowing billions to prop up government employee pension and post-retirement health care benefits should first look at recent developments in California. That state's massive state pension system, CalPERS, may lower its expectations for investment returns. According to the Wall Street Journal, it is considering a drop in its return expectations from 7.75 percent to as low as 5 or 6 percent.
Seriously, maybe we should just turn the state over to the Michigan Education Association, given that they are so much more brilliant than our elected officials in Lansing. Consider the following two stories, both connected to the Race to the Top legislation that is starting to look like something of a fiasco for everyone who isn’t an MEA lobbyist.
The League of Women Voters put out a press release on March 8, 2010, touting its plan to bring almost 100 "Sisters on the Planet" ambassadors to Washington to lobby Congress on the need to pass cap-and-trade legislation. Even proponents of this legislation widely acknowledge that it will drive up the cost of electricity. The League's press release states, "Women around the world are disproportionately affected by climate change." They would have it right if their statement read: Women around the world are disproportionately affected by climate change policy.
Mackinac Center Legal Foundation Director Patrick J. Wright will testify today before the Senate Families and Human Services Committee on proposed legislation to end the forced unionization of home-based day care owners and prohibit any stealth attempts to unionize contractors involved in home health care services. The committee will consider Senate Bills 1173, 1178 and 1179 at 2:30 p.m. in Room 210 of the Farnum Building.
Arguing against a 3 percent pay hike for state employees is actually an argument in support of saving their jobs, according to an Op-Ed in The Michigan Daily.
The commentary cites a recent blog post by Paul Kersey, director of labor policy, which explained that compensation increases for state employees outpaced that of the private sector by one-third between 2002 and 2008. The author explains that rejecting this newest salary bump can save state workers' jobs. As an example he uses the 100 state troopers who were laid off last year after their union rejected a request from Gov. Jennifer Granholm for unpaid leave.
The Michigan Education Association is taking heat even from some of its friends in the media because of the state's failure to qualify for $400 million in competitive "Race to the Top" federal grants. To be eligible, Michigan had to enact a slate of education reforms including expanding the number of charter schools, creating a more rigorous "failed school" takeover process, establishing "merit pay," increasing performance accountability for teachers, and more.
Between now and April 10, the Legislature has the ability to cancel a scheduled 3 percent across-the-board pay raise for unionized government employees.
It has been argued that government employees have already made concessions. But the bottom line is that state employees are still doing pretty well. According to the Bureau of Labor Statistics, the average wage in Michigan (not corrected for inflation) increased by 14.9 percent between 2002 and 2008. But for state employees, the average wage calculated by the Civil Service Commission increased by 21.9 percent. Wages for state employees have gone up half again as fast as they did for workers throughout the state. Certainly they can afford to go without an across-the-board raise this year.
In explaining his refusal to vote on a resolution that would cancel a 3 percent raise for state employees, State Sen. Bruce Patterson, R-Canton, cited the opinion of the state’s budget director that such an action would constitute an “unfair labor practice.”
The Congressional Budget Office today said a proposal by the Obama administration to levy a "tax" on banks would ultimately be "borne to varying degrees by an institution's customers, employees, and investors," according to ABC News.
David Littmann, the Center's senior economist, explained why the idea was faulty way back in January.
