Friday, December 7, 2012

Michigan's Midnight Rush to Right-to-Work

Elections have consequences. Thus president Obama will prevail on much of his tax and spending agenda, at least for the next year at the national level.

Conversely the 2010 midterm elections resulted in a Republican sweep of the Midwest. Indiana, Michigan, Ohio, and Wisconsin became solidly Republican. These states remained Republican after the 2012 election.

Wisconsin under Governor Scott walker enacted a sweeping anti-union reform act for public employees, excluding police and fire. The legislation survived judicial elections and challenges, recall elections of legislators and Governor Walker, and a referendum. The teachers union in particular saw its membership plummet.

Ohio's enacted an even more stringent statute, which included police and fire. It was overturned by the voters in a referendum featuring ads with firefighters saying they couldn’t get to a fire because of the act.

Governor Snyder's agenda in Michigan was slightly different. in addition to the budgetary mess left behind by his predecessor Governor Granholm, who immediately fled to Berkeley upon leaving office, the cities of Detroit, Lansing, and flint are essentially bankrupt.

His response was to control spending, lower taxes, and enact an emergency manager statute whereby the Governor could appoint an emergency manager to take over the finances of distressed cities. This manager could override union contracts.

The Republicans legislative leaders proposed the enactment of a Right-to-Work statute, but the Governor demurred, saying it was not on his agenda. The idea went into hibernation.

Employees under a Right-to-Work statute cannot be forced to join a union or pay an agency fee in lieu of membership. The southern states are Right-to-Work. Nissan, Honda, Toyota, Mercedes, and BMW opened almost all of their United States assembly plants in non-union Right-to-Work states in the South. They had a major cost advantage over the unionized plants of Detroit’s Big Three.

The Chamber of Commerce has long believed that new businesses were leery of opening up in Michigan because of the unions.

The response of the unions to Governor Snyder’s approach was somewhat surprising, actually suicidal. They put several pro-union measures on the November ballot. Only one which passed; it overturned the Emergency Manager Act.

Proposition 2 was the more contentious measure. It would have enshrined collective bargaining rights in the Michigan Constitution, making public employee contracts untouchable.

President Obama carried Michigan, but Prop 2 failed by 15%.

Detroit is nearing bankruptcy; it will run out of cash soon. Mayor Bing has been engaged in Herculean efforts to reform and save the city, which has lost half its population in the past three decades. The United Auto Workers has similarly shrunk in size with Detroit and the city.

The public employee unions in Detroit have been intransigent in opposing the Mayor’s efforts. Detroit may run out of cash within two months.

With the impending collapse of Michigan's biggest city, the massive defeat of Prop 2, and the success of neighboring Indiana in attracting jobs since becoming a Right-to-Work state, the Republican leaders in Lansing said enough is enough.

Michigan, the cradle, heart, and backbone of Big Labor, is going Right-to-work. Michigan, the birthplace of the UAW, once the most powerful union in America, will be Right-to-Work.

As Vice President Joe Biden might say "This is a big deal."

The Governor said “This is about taking care of the hard-working workers of Michigan, about being pro-worker, about giving them the freedom to choose who they associate with.”

That’s all true, but the unions took their shot in November and lost – more than they anticipated.

The Governor did not want to pick a fight with the unions, especially the UAW, prior to November. The UAW effectively ran the political system of Michigan for decades, but is now weakened.

The private sector unionized work force is down to 17% in Michigan.

The Republicans learnt from Ohio's mistake. The new Michigan  Right-to-Work statute applies to both private and public employee unions, but as with Wisconsin, firefighters and police. There will be no ads by firefighters saying they could not respond in time because of the statute.

The Senate needs to take one more vote next week, and then the Governor will sign the bill.

Wisconsin, the cradle of the Progressive Movement, turned the Progressives out in 2010.

We are witnessing an electoral revolution in the Midwest, the heartland of America.

The unions will litigate, probably find a friendly circuit judge as in Wisconsin, but the dye is cast. Union power is shrinking in Michigan. President Obama’s bailout bought time for Detroit and the UAW, but they remain on life support.

Who could have forecast that the New Millennium would bring radical change to the politics of Michigan and Wisconsin?

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