Worker freedom, low taxes draw people
Scholars with the Mackinac Center for Public Policy, as well as other institutions, have used descriptive statistics in conjunction with empirical evidence to tell stories — sometimes profound ones. A good example of this was published recently by “Opportunity Ohio” and should be explored further.
One of my favorite uses of descriptive statistics numbers involves right-to-work laws and American migration. For many reasons, Americans pick up and move. Often such moves involve economic motivations. A great policy question is why so many Americans have moved from non-right-to-work states to ones with such legal protections. Is it just a coincidence or is there some type of clear link?
The evidence seems to be clear: a right-to-work law makes that state more economically attractive and tends to draw in-migrants.
Of the nine states with the greatest population growth from 2000 to 2009, six were right-to-work states and a seventh (Colorado) possessed a quasi-RTW law with its “Labor Peace Act.”
Economist Richard Vedder, a member of the Center’s Board of Scholars, examined population changes and other possible explanations including climate, taxes, population and other variables and found “without exception, in all the estimations, a statistically significant positive relationship … was observed between the presence of right-to-work laws and net migration.”
Opportunity Ohio, a Buckeye-based nonprofit group, released a chart titled “Two Winning Policies for Job Growth” in which it detailed states that maintain “winning policies” for job growth such as low personal income tax rates and right-to-work laws, as measured by employment. It found, for instance:
- Seven of the 15 highest growth states since 1990 had no income tax;
- Six others maintained rates below the national average, which was 5.6 percent;
- Right-to-work states outperform forced unionization states. Nine of top 12 performers are also right-to-work states.
It specifically noted that “right-to-work states perform well even with higher income taxes.”
The Mackinac Center’s own empirical research confirms that the presence of a right-to-work law is a powerful economic development tool. We found that between 1970 and 2011, right-to-work status meant an average employment growth rate 0.8 percentage points higher than the rate would otherwise be. So, if a state would have had a 2.0 percent growth rate, right-to-work status made it 2.8 percentage points; a huge 40 percent difference.
The Opportunity Ohio people who put this graphic together believe that combining these two policies — low personal income tax rates and status as a right-to-work state — can be particularly effective for creating employment.
It is an idea worth exploring.
LaFaive: Special favors unfair to competitors, taxpayers
Michigan Strategic Fund board members voted Tuesday to divert almost three-quarters of a million dollars in local and school taxes to a private entity so that a Redford Township car dealership can upgrade its facilities, MLive reports. The Michigan Economic Development Corp. will give the dealership $719,528 to renovate its building and install a car wash on an adjacent piece of land it owns.
Michael LaFaive, director of the Morey Fiscal Policy Initiative, said this type of special treatment is unfair.
“It’s unfair because this dealer no doubt competes with other dealers not lucky enough to get a government handout,” he told MLive. “Robbing many taxpayer Peters to subsidize the corporate Paul only shifts precious resources around. Evidence shows it is unlikely to create net new jobs. Worse, this is money that could have accrued to local schools. Depriving them of such revenues represents a very high opportunity cost, unless of course some future graduates intend to wash cars on the new site.”
Commentary in Capital Research Center's "Labor Watch"
Labor Policy Director F. Vincent Vernuccio has written a lengthy commentary about the problems plaguing the UAW — including its defeat at VW’s plant in Chattanooga, a 25 percent dues hike and leadership failures — for Capital Research Center’s “Labor Watch.”
Vernuccio also wrote about this matter here.
Online voting runs through Sept. 2
Labor Policy Director F. Vincent Vernuccio is a finalist in Think Freely Media’s “Great Communicators Tournament.” Think Freely Media is a nonprofit organization that assists pro-liberty and pro-free market groups communicate more effectively. You can vote for Vernuccio online through midnight on Sept. 2. A dozen finalists will be chosen to participate in the tournament at the State Policy Network’s annual meeting Sept. 23-26 in Denver.
More than 100 news outlets have coverage
An Associated Press story about teachers opting out of the Michigan Education Association this month has drawn large-scale attention, appearing in more than 100 news outlets around the country, including The Detroit News, Huffington Post, Education Week, Bloomberg Businessweek, the St. Louis Post-Dispatch, the San Francisco Chronicle, the San Antonio News-Express, Townhall, the Las Vegas Sun, the Seattle Post-Intelligencer, Investor’s Business Daily, the Fort Wayne Journal-Gazette, the Houston Chronicle, the Albany Times-Union, Salon, Crain’s Detroit Business, the Minneapolis Star-Tribune, WJRT-TV12 in Flint and WILX-TV10 in Lansing.
Teachers looking for information about their rights can visit www.Augustoptout.org to learn more.
LaFaive: "Recommend students stay away"
Fox News and The College Fix are reporting on the irony of former Michigan Gov. Jennifer Granholm teaching a graduate-level course this fall at the University of California-Berkeley that will focus on “creating jobs through better government policies.”
The College Fix noted that Michigan unemployment was 6.6 percent when Gov. Granholm first took office, but more than doubled — to 14.2 percent — by 2009.
Michael LaFaive, director of the Morey Fiscal Policy Initiative, said that spike came about after Gov. Granholm pushed for an 11 percent tax hike.
“My reaction is to recommend students stay away unless her section of the class is a lesson in what not to do,” LaFaive told Fox News.
As LaFaive noted in 2011, Gov. Granholm was just one of many Michiganders who left the state to find work after her time in office was over.
Key votes from 2013-14
While the Legislature is on a summer break the Roll Call Report is reviewing key votes of the 2013-2014 session.
Note: There will be no Roll Call Report next week. The House has a session scheduled for Aug. 27, and if there are any noteworthy votes they will be reported in the following week's report.
House Bill 4782, Expand a corporate/developer subsidy regime: Passed 87 to 23 in the House on November 14, 2013
To authorize creation of a sixth “Next Michigan Development Corporation,” which is a government agency that gives tax breaks and subsidies to particular corporations and developers selected by political appointees, for projects meeting extremely broad "multi-modal commerce" criteria (basically, any form of goods-related commerce). The new entity would be in the Upper Peninsula.
House Bill 4688, Repeal licensure mandates for dietitians and nutritionists: Passed 71 to 39 in the House on November 13, 2013
To repeal a law that imposes a licensure mandate on dietitians and nutritionists. The mandate has not been enforced since it was authorized in 2006 because the state licensure agency was unable to devise acceptable credentialing and education requirements.
House Bill 4044, Ban mandating all health insurance go through the "exchange": Passed 72 to 37 in the House on December 12, 2013.
To prohibit a state “exchange” created under the federal health care law from mandating that insurance companies must sell all health insurance policies through the exchange. The Michigan legislature elected to let the federal government create an exchange here rather than create a state-run version, so the measure would only have effect if that choice is later reversed. The Senate has not taken up this bill.
House Bill 4816, Require insurers disclose federal health care law price hikes in bills: Passed 67 to 42 in the House on December 12, 2013
To require that customer health insurance bills include an estimate of how much of any price increase was caused by mandates and regulations imposed by the federal health care law. The Senate has not taken up this bill.
House Bill 4576, Regulate federal health care law “navigators”: Passed 102 to 7 in the House on December 12, 2013
To impose regulation and a "certification" requirement on the “navigators” authorized by the federal health care law to assist persons applying for government-subsidized health insurance benefits through the "exchange." The bill authorizes background checks, testing and training requirements, and more. The Senate has passed a similar bill (Senate Bill 324), but neither bill has yet been passed by the other body.
House Bill 5104, Authorize medical “marijuana infused products”: Passed 100 to 9 in the House on December 12, 2013
To authorize the use of “marijuana infused products” under the state’s voter-initiated medical marijuana law. This is defined to include any "topical formulation, tincture, beverage, edible substance, or similar product intended for human consumption in a manner other than smoking." The bill is currently pending on the Senate floor.
House Bill 4271, Authorize and regulate medical marijuana dispensaries: Passed 95 to 14 in the House on December 12, 2013
To authorize and establish a comprehensive regulatory regime for medical marijuana dispensaries, including municipal licensure or prohibition, with civil and criminal penalties for violations. The provisions of the state's voter-initiated medical marijuana law were ambiguous about dispensaries, and the state Supreme Court banned them early in 2013. The bill is pending on the Senate floor.
House Bill 4486, Authorize involuntary treatment for substance abuse: Passed 102 to 8 in the House on February 13, 2014
To allow relatives or a health care professional to petition a court to take an individual abusing drugs or alcohol into protective custody for involuntary treatment if there is clear and convincing evidence that the person presents an imminent danger or threat to himself or others. The bill prescribes specific procedures, requirements and limitations on involuntary treatment.
House Bill 4782, Expand a corporate/developer subsidy regime: Passed 31 to 6 in the Senate on December 11, 2013
The Senate vote on the bill described above. This was signed into law on Dec. 21, 2013.
House Bill 4688, Repeal licensure mandates for dietitians and nutritionists: Passed 26 to 12 in the Senate on June 11, 2014
The Senate vote on the bill described above. This was signed into law by Gov. Rick Snyder on July 1.
House Bill 4486, Authorize involuntary treatment for substance abuse: Passed 38 to 0 in the Senate on June 3, 2014
The Senate vote on the bill described above. This was signed into law on June. 24.
SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit http://www.MichiganVotes.org.
Union still threatening those who stopped paying dues
Why political parties are missing the larger picture
An analogy used to describe the extent to which a political party is exclusive or inclusive is whether or not it is a “big tent” or a “small tent.” This analogy is most commonly employed in reference to the Republican Party. In essence, the terms “big tent” and “small tent” are used to describe the width and depth of a party’s political appeal.
When the Republican Party is said to be a “small tent,” the intimation is that the political positions it holds represent too narrow a segment of the voting public. Frequently this accusation is accompanied by a list of issues upon which the party supposedly needs to change its policy position.
How often these suggested changes are the result of analysis is questionable. Sometimes polling is cited to support making the policy changes. The idea of standing up for principle is almost never cited and those recommending the changes virtually always oppose the positions they recommend be changed.
No doubt, the Republican Party too easily slips into presenting itself too narrowly. To varying degrees it does so most of the time — and suffers for doing so at the ballot box. However, despite claims to the contrary, the GOP does not fall into the “small tent” trap when it refuses to adopt positions held by its opponents. It does so again and again when it represents business and management at the expense of freedom and liberty.
Arguably the same observation could be applied to the Democratic Party; when it subordinates freedom and liberty to unionism.
As both major political parties fail to fully embrace freedom and liberty, the power struggle between them devolves to contests of short-term populism, misinformation campaigns and rhetorical prowess. Under these circumstances the open path to the “big tent,” which the advancement of freedom and liberty offers, becomes a nearly abandoned road.
If its quest is to become a “big tent” party, the GOP must stand with freedom and liberty, even when adopting such positions collides with the immediate interests of business and management. To do otherwise means losing all claims of representing anything more than a limited, though powerful, strata of society. And is there any doubt that this narrower vision of the Republican Party is the image it maintains with large portions of the voting public today?
Think of how often Republican candidates and officials sound as though they believed every voter owned a businesses. Time and again, Republicans mistakenly use issues that are primarily attractive to the business community as if the issues had more general appeal.
Of course, creating conditions under which businesses and the economy can thrive is vital. But in and of itself the message falls far short of what it could be and opens the door to all of the traditional disagreements between labor and management.
Couple that better economy and jobs message with a dedication to real reforms that bring about more freedom and liberty and its potential positive impact increases exponentially. This is not a combination that will appeal only to conservatives. If, and only if, freedom and liberty are placed on the first rank — above all other considerations — does the message call to the full spectrum of voters.
Contrary to what many believe, liberals in general do not love government. They simply distrust and fear other entities and conditions in the world and see government as their primary protector against those elements. Conservatives distrust and fear the same entities and conditions but believe giving more power government will likely make matters worse.
Liberty and freedom are concepts that transcend these differing perspectives.
Based on recent polling, neither major political party in this nation can, with a straight face, claim to have a “big tent” appeal. For years polling has shown that voters tend to want smaller government and to see government more as a problem than as a solution. Make no mistake about it; both of these sentiments are joined at the hip with the fear of freedom and liberty diminishing.
Theoretically this should be an advantage for Republicans. But in recent years it has been an advantage Republicans love to speak to but very rarely deliver on.
The more the game of politics comes down to Republicans representing business and the Democrats representing labor, the more the debate becomes pedantic. It’s too often “our” special interests versus “their” special interests. Each side strives to turn out its base and key elections are decided by voters in the middle who see little virtue on either side. Meanwhile, in a political sense, the eternal and potential “big tent” producing issues — freedom and liberty — remain available and up for grabs.
(Editor’s note: Jack Spencer is Capitol Affairs Specialist for Michigan Capitol Confidential and a veteran Lansing-based journalist. His columns do not necessarily represent viewpoints of the Mackinac Center for Public Policy or Michigan Capitol Confidential.)