Andrew Biggs of the American Enterprise Institute has provided some useful context on the source of bogus arguments being used to oppose a pension reform passed by the Michigan Senate last week. The self-serving mischief has caused tremendous confusion in the House, threatening to derail a potentially transformational reform. Biggs’ subject was new research by University of Arkansas economist Robert Costrell, which was cited here.
According to an article on MLive, a budget plan put forth by Gov. Rick Snyder, Senate Majority Leader Randy Richardville, R-Monroe, and House Majority Speaker Jase Bolger, R-Marshall, would double the amount of money being spent on Michigan’s film subsidy program. Spending taxpayer money on millionaire Hollywood movie producers and stars is a bad idea.
Gov. Rick Snyder and former West Virginia Gov. Bob Wise spoke at an online learning panel discussion in Lansing Wednesday hosted by the Mackinac Center. The Grand Rapids Press, MIRS News and Gongwer News Service all covered the event.
Gov. Wise also spoke about the topic Wednesday evening and was joined by Michael Flanagan, superintendent for public instruction, and Dr. William Skilling, superintended of Oxford Community Schools. The Midland Daily News has coverage of it.
When school boards entertain the idea of contracting out to provide a service, school employee unions often warn of the dangers of such actions. They usually claim districts will ultimately fail to save money (being victimized by predatory pricing schemes), will fill schools with uncaring and dangerous “strangers,” and will end providing poorer services.
Richard Antonini, former chairman of the Mackinac Center for Public Policy’s Board of Directors, was inducted into the Junior Achievement West Michigan Business Hall of Fame last night, according to the Michigan Business Review.
Antonini, of Grand Rapids, retired in 2000 as chairman and CEO of Foremost Corporation of America, which merged with Farmers Insurance under his direction. He has served on the Junior Achievement Leadership Circle and the boards of Cornerstone University, Old Kent Financial Corp. and Spectrum Health Foundation.
Thanks to House Republicans, a major school pension reform passed by the state Senate last week could be undone. As reported by CapCon, Senators defied government employee unions by voting to close the chronically underfunded “defined benefit” school pension system to new employees, starting in 2013.
Some Republicans in the Michigan House, among them Appropriations Committee Chairman Rep. Chuck Moss, R-Birmingham, are urging their colleagues to pass legislation that would “prefund” optional health insurance benefits currently provided to retired school employees, who can start collecting these as early as age 46 in some cases.
There is no doubt that Michigan Gov. Rick Snyder has presided over a major expansion of school choice in this state: An artificial cap on the number of brick-and-mortar charter public schools is on a path toward elimination in 2015, and a similar limit on the number of parents who can choose online charter schools for their children is also going up. At the same time, however, these advances look almost modest compared to a nationwide trend of states taking school choice to the next level. The school choice bar is moving rapidly higher.
Former West Virginia Gov. Bob Wise in a Detroit Free Press Op-Ed Sunday extolls the benefits of online learning.
Wise, a Democrat who also served in Congress, will be speaking at an online learning discussion sponsored by the Mackinac Center that starts at 6 p.m. Wednesday at The Lansing Center. He and Gov. Rick Snyder also will participate in a panel discussion on the same topic at noon Wednesday.
A Viewpoint commentary by Michael Van Beek, director of education policy, on “flipped” classrooms appears today as an Op-Ed in the Shelby Township Source. A flipped classroom is one in which students watch or listen to pre-recorded lectures outside of class time, and then classroom time is used by the teacher to mentor students as they do homework or projects.
Y = Yes, N = No, X = Not Voting
Senate Bill 1040, Adopt school employee pension reforms: Passed 20 to 18 in the Senate
To close the current "defined benefit" public school pension system to new employees hired starting in 2013, and instead give them 401(k) accounts with employer contributions equal to 4 percent of salary. New hires also would no longer be eligible for retirement health insurance benefits, but instead would get extra contributions into their 401(k) accounts. Current retirees would have to pay 20 percent of the cost for their health benefits, up from 10 percent now. Current school employees would have to contribute more toward their pensions, or else receive benefits calculated under a less generous formula.
Mackinac Center analysts have been pretty tough on Senate Republicans who in recent days progressively watered down proposed school employee pension reform.
However, when the time came to stop talking and start voting, the Senate made a respectable down payment on desperately needed reforms. Referring to one major reform provision added late in the process, Senate Majority Leader Randy Richardville, R-Monroe, said to reporters, “Tell the Mackinac Center that, OK?”
The Michigan Senate today approved an amendment that would offer school employees hired after Jan. 1, 2013, a defined-contribution retirement system instead of a defined-benefit plan. If enacted, this will limit Lansing’s ability to defer the costs of pension benefits to future generations.
Jack Spencer, capitol affairs specialist for Michigan Capitol Confidential, was a guest on “The Frank Beckmann Show” on WJR AM760 this morning. Spencer discussed his latest story, which outlines how the SEIU is paying for a shell corporation to remain open after it was defunded by the Legislature. The Michigan Quality Community Care Council that was set up as the dummy employer in a scheme to skim millions of dollars from Michigan’s most vulnerable families operates three hours a month. In short, the union is paying the employer of the people it is supposed to represent so it can continue to operate and funnel dues money back to the union.
Senate Majority Leader Randy Richardville, R-Monroe, told reporters “Tell the Mackinac Center that, OK?” on Wednesday in announcing his support for legislation that would put public school teachers in Michigan hired after Jan. 1, 2013, into a defined-contribution 401(k)-style plan, according to The Detroit News.
Senior Economist David Littmann is heavily cited in a Detroit News story today about Michigan’s declining unemployment rate.
“Signs are trending upward at this point at a relatively slower pace than in the first quarter,” Littmann said of the announcement that unemployment in the state fell in April from 8.5 percent to 8.3 percent. “We’ll get some improvement with some of the reductions in gasoline prices to restore a little bit of purchasing power, but the great uncertainties are still out there getting worse.”
(Editor's Note: Attorney General Bill Schuette ordered on May 26 that state agencies stop withholding money from home health care worker checks and handing it over to the SEIU as union dues, thus ending a union scheme that took more than $30 million from workers.)
From today's Wall Street Journal, "Saying No to State Bailouts," by Rep. Kevin Brady, R-Texas, and Sen. Jim DeMint, R-South Carolina:
Michigan's policymakers have at least recognized we have a problem, but already the issue is in doubt given how almost every day brings new reports of politicians watering down a proposal to reform unaffordable and unsustainable public school retiree health insurance benefits and pensions.
According to Gongwer News, Gov. Rick Snyder will propose some $500 million annually of “pre-funding” for the optional health insurance benefits that are now provided to school retirees, all or most of which would come from taxpayers for the next 25 years.
Y = Yes, N = No, X = Not Voting
Senate Bill 1069, Cut tax imposed on manufacturers' tools and equipment: Passed 23 to 14 in the Senate
To eliminate (starting in 2015) the so-called “personal property tax” on tools and equipment used by manufacturing firms (including things like assembly lines), starting with new equipment acquired from the start of 2012. The bill would also phase out the tax on existing equipment over a seven-year period beginning in 2015. Senate Bill 1072 would earmark tax revenue that now pays for previously-granted “corporate welfare” tax breaks and subsidies to reimburse local governments for the proposed reduction in revenue caused by this tax cut. The “personal property tax” currently costs businesses statewide around $1.2 billion annually, which would eventually be reduced by around $470 million.
A group calling itself “Occupy the Tri” from the Tri-Cities area of mid-Michigan plans to protest the Mackinac Center’s headquarters during non-business hours Saturday, according to The Saginaw News.
Michael Jahr, vice president for communications, told The News that the “Occupy Movement should find a lot to like in the Mackinac Center’s work,” in reference to the protestors’ dislike of bailouts.
Michigan Capitol Confidential documents more waste from the federal “stimulus” package passed in 2009: “Federal ‘Stimulus’ Spent $34.5 Million In Michigan For Only 183 Total Jobs”
The whole article is a good read, but one thing stands out specifically: The state and companies receiving these subsidies all defend the program by pointing out that they lay the groundwork for alternative energy and the “greening” of the energy sector.
Arthur Brooks, president of the American Enterprise Institute, was a guest on “The Frank Beckmann Show” on WJR AM760 Thursday, discussing his new book, “The Road to Freedom.”
The Mackinac Center will host Brooks on June 12 and June 20 to talk about his book and free enterprise.
This Michigan Capitol Confidential story by Jarrett Skorup about the folly of central planning for energy policy has since run in Crisis Magazine, The Blaze and Catholic Exchange.
Michigan Capitol Confidential today is reporting that a major teachers union in Michigan claimed an online charter public school operator made $522 million in profits in 2011, but the company actually had revenues of that much. The state chapter of the American Federation of Teachers made the claim in a legislative update opposing Senate Bill 619. You can read more about the expansion of parental choice and educational options that lifting the cap on cyber charter schools offers here.
