Last updated on 2014.10.25
The pluto-corporate propaganda mill is in full churn promoting the Michigan GOP's push for new anti-union "right-to-work" laws. Someone sends Pat Powers a slew of correlation-causality-conflating quotes to run on his blog to convince us that everything comes up roses when you pass right-to-work laws.
One of the sources Powers cites is this January 2012 advocacy piece on the economic impact of right-to-work laws from the Center of the American Experiment. The central thesis of the authors is that even though Minnesota has prospered with right-to-work laws in effect, Minnesota would be doing even better if it adopted right-to-work laws like those of its neighbor South Dakota.
PP's argument sounds eerily similar to the fundamental and, of course, untestable economic argument offered by the Obama Administration that the current sluggish economy would have been even worse without the 2009 stimulus. The only difference is that the Obama Administration's claim wins the consensus support of economists, while Powers's blog post is the usual right-wing wishful thinking.
First, note that the Center of the American Experiment is a tentacle (or maybe just a cilium) of the American Legislative Exchange Council, the well-known arm of corporate power waging war on democracy. It has received Koch Brothers money and Koch-Youth interns.
More importantly, the CAE study is a classic example of disguising (not mistaking, because this conservative think tank says what it says very deliberately) correlation for causality. They say that the 22 states with right-to-work laws have enjoyed higher than average economic growth than the states without such laws; they conclude that Minnesota would thus have higher economic growth if it adopted right-to-work laws.
In a similar vein, I point out that South Dakota has recently enjoyed higher than average economic growth. South Dakota also has also recently enjoyed my blogging. I conclude that Minnesota would have higher economic growth if it had me blogging about it.
The most laughable example of the CAE's deliberate correlation-causation confusion is the authors’ conclusion that people move to right-to-work states because of right-to-work policies. “Hey, hon! Pack the wagon, load up the kids; we’re moving to a right-to-work state!” said no one ever... except maybe for an extra in a scene so awful it was deleted from Atlas Shrugged. Most of the right-to-work states are down south and out west. People move there because the weather’s nice and because we've developed air-conditioning. They also go because they find jobs, and we can debate the impact of right-to-work policies on job creation. But right-to-work as direct cause of migration is a stretch.
The CAE study undermines its own claims by noting the following facts:
- Minnesota has higher union membership than the U.S. average
- For four of the five preceding decades, Minnesota has had higher per capita income growth than the US average.
- The table on page 16 shows four variables with a more significant impact on growth than right-to-work policies. The coefficient relating right-to-work to economic growth is also tiny. If you're a policymaker with limited political capital, you work on those other variables before you tinker with labor laws.
If the CAE wants to play the correlation-causation game, it should line up its Figure 2 (page 7) showing the steady decline in union membership with the cotemporaneous wage stagnation that has sandbagged everyone but the top one percent of income earners (and when referring to the one percent, "earners" needs air quotes) even though every worker is more productive. If the CAE's alternative-history claims that Minnesota would have an even better economy if Bill Janklow would have invaded in 1982 and imposed right-to-work laws, then it is at least as logical for me to claim that if Janklow, Rudy Perpich, and every other governor had done more to respect and promote the role of unions in protecting economic justice, and if union membership had kept pace with levels seen back in the 1950s and 1960s, current median household income would be $92,000, not $50,000.
- RTW doesn’t boost economic growth. There’s no relationship between RTW laws and a state’s unemployment rate, per capita income, or job growth.
- RTW has no significant impact on attracting employers to a state. Surveys show RTW as a minor or non-existent factor for employers when they’re considering locations.
- RTW lowers wages. Both union and nonunion workers earn an average of $1,500 less per year in RTW states.
- RTW threatens employment benefits. Workers—both union and nonunion—are less likely to have either health insurance or pensions through their jobs in RTW states [Gordon Lafer, "Don't Be Fooled, Michigan: 'Right to Work' Is Just Plain Wrong," EPI: Working Economics, 2012.12.07].
According to the Minnesota AFL-CIO, right-to-work states also spend less on education and have higher workplace fatality rates.
Don't let Pat Powers or the CAE fool you with junk science. Right-to-work laws are not about improving the economy. They are about weakening unions and making it easier for the one percent to hoard more of the wealth that we generate for them.