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Minnesota Families Could Have Been $6,000 Better Off With Right-to-Work

How’d you like some extra money in your pocket? It might come through an unexpected source: do away with mandatory union contracts. Just yesterday, Indiana took a big step in that direction when the state House approved a right-to-work measure. The Senate and governor are both expected to sign on.

Today, the Center of the American Experiment releases a new report on right-to-work laws, under which workers have the freedom to join, or not join, a union. The report, Minnesota Right-to-Work: How Freedom of Workers in the Workplace Enhances Prosperity, is written by Richard Vedder, Matthew Denhart and Jonathan Robe. For the last 60 years, the U.S. has been divided into 22 states that are right-to-work and 28 that are not. After using some standard economic tools to analyze the performance of the two groups of states, the authors conclude:

The average Minnesota household would have a personal income that is $5,960 to $7,740 had the state enacted right-to-work in 1977. Just think: What would your family do with another $6,000?

Right-to-work states have seen more economic growth than other states. When you compare the two groups of states from 1977 to 2008 (the years for which the authors had comparable data), per-capita income grew more in right-to-work states (63 percent) than in other states (54 percent).

More people have moved to right-to-work states from states that don’t have those laws–almost 5 million, in fact.  This suggests that people vote with their feet for states with strong economies. You will, for example, find large numbers of former Midwesterners living in Texas and Florida. They are not only retirees, but people who moved to find work. The Census Bureau tracks population movements, though it doesn’t track people by occupational status. But you’ll find plenty of anecdotal evidence outside the report that people move for jobs.

The report looks at why right-to-work contributes to economic growth, though in short, it’s because it makes the state more attractive to employers.  (Go figure!) It also has some very interesting numbers on public-sector union membership. (Outside the Northeast, which state has the highest rate of unionization in the government workforce? It isn’t Wisconsin, which was the first state to extend collective bargaining to public workers.) The report also has a short description of how labor law has evolved over the years, from anti-union to pro-union to what I would call, in the case of right-to-work, neutral-to-unions. (Want to join? Go for it. Want to decline? Go ahead.) One thing I wish the authors had looked at was how unions operate in right-to-work states. They argue, reasonably, that unions in those states have to hustle harder to attract members. So what do successful unions in right-to-work states do?

There’s one other fly in the ointment, and that Minnesota has, historically, had a higher-than-average income as well as higher-than-average income growth–despite not being a right-to-work state. (In fact, per-capita income has grown almost as much here as it has in right-to-work states.) Doesn’t this contradict the idea that right-to-work is good for economic growth?

The authors acknowledge that Minnesota has historically had a higher income than the average state, a fact that might go against the argument for right-t0-work. The difference, they say, is Minnesota’s above-average human capital: higher education levels, a less dysfunctional society, a greater respect for the rule of law, and higher workplace participation. But, they say, the state could have done even better under a right-to-work law.

Is Reforming Public Pensions a Winning Idea?

You might say that 2011 was the year when the costs of public pensions started to emerge into the national consciousness, what with all the events that happened in Wisconsin. What does this year hold? A noted Washington DC-based think tank has assembled a group of experts who will address that question.

The American Enterprise Institute (AEI) is having a conference called “Collective Bargaining, Public Pensions and Voters: The Policy and Politics of Public-Sector Employees in the 2012 Elections.” It will be held Wednesday, January 25, from 7:30-10am, CST. The event is in DC, but it will be streamed online, so you can bypass the TSA and still participate. Just click on the AEI website when the time comes.

Here’s the official description of the event.

In states around the country, 2011 was marked by substantial and sometimes acrimonious debate over reforms to public-sector employees’ compensation, especially pensions and fringe benefits. States including Massachusetts, Michigan, New Jersey and Rhode Island enacted a variety of reforms designed to shore up ailing state finances and reduce future liabilities. In Wisconsin, the debate over reform virtually paralyzed the state government for weeks. And in Ohio, a vote to eliminate public-sector collective bargaining and trim benefits was roundly rejected by voters.

What does 2012 hold, both in terms of policy and politics, for the developing relationship between public-sector workers and taxpayers? What does a proactive reform agenda for 2012 look like? Is a pro-reform platform a winning issue for reformers or their opponents? This event will address these and other questions in two panel discussions: the first looking at the state of public employee pensions and potential future reforms, and the second examining the politics surrounding public employee compensation reform, including who won and lost politically in 2011 and what these state-level skirmishes can tell us about the 2012 elections.


Press Release: Childcare Unionization TRO Hearing Moved to February 22nd


Thursday, January 5th, 2011


CONTACT                                                                                                   FOR IMMEDIATE RELEASE

Dan McGrath


612-605-3303 Ext. 703


Judge Grants Request for Summary Judgment Hearing in Minnesota Childcare Unionization Case

Hearing converted and continued to February 22nd


St. Paul – Childcare providers who sued Governor Dayton over his executive order calling for an election to unionize their industry have requested a summary judgment hearing.  This week, Judge Dale Lindman granted their request which should help to streamline the process.  As a result, the hearing originally scheduled for January 17th has been rescheduled to February 22nd.


On December 5th, Judge Lindman granted the plaintiffs’ request for a temporary restraining order blocking the unionization vote that was scheduled to begin on December 7th.  At that time, a hearing on a temporary injunction was scheduled for January 17th, 2012.


Attorneys for the plaintiffs subsequently made the request for summary judgment.  On Wednesday this week, Judge Lindman granted the plaintiffs’ request, converting the hearing originally scheduled for January 17th to a summary judgment hearing to be heard on February 22nd, 2012.  The temporary restraining order blocking the unionization election will remain in force at least until the February hearing.


“We won a restraining order and the next step was a temporary injunction, then a permanent injunction,” said Jeff Davis, speaking for the Childcare Freedom Coalition. “By granting our request for summary judgment, the judge is cutting through all of that. The case has already been argued and it’s time to put this to bed. This move will save us as well as Minnesota taxpayers needless added time and expense.”


Summary judgment could represent Judge Lindman’s final determination on the merits of the case, but which ever way he rules, appeals are still possible.


“We believe the law is clearly on the side of the plaintiffs in this matter,” Davis said, “The governor’s attorneys are citing statutes that pertain solely to state employees as justification to unionize these small business owners.  He essentially wants to treat childcare providers like employees of the state without calling them employees, and he lacks the legal authority to do so. We expect to prevail and hope that the governor will not waste more tax dollars pursuing appeals to try to keep his unlawful unionization scheme going.”


The summary judgment hearing is scheduled to occur at 2:30 PM on Wednesday, February 22nd at the Ramsey County Courthouse.






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