A proposal to rescue Michigan
By Leon Drolet
Michigan’s government class – school, state and local government employees – is proving far more immune to our state’s economic decline than private sector citizens. In fact, recent statistics demonstrate that most government employees are prospering compared to Michigan’s long-suffering private sector workers.
According the U.S. Bureau of Labor Statistics, the average government worker now makes $25.97 in wages and also receives lavish health care, retirement and time-off benefits worth an additional $13.53 per hour.
Private-sector workers in the Midwest earn an average wage of $18.83 with benefits worth $8.09 per hour. The discrepancies remain even when private sector workers are compared to government employees performing similar jobs (government managers vs. private sector managers, private service worker vs. government service worker, etc.).
But there’s even more good news for government employees.
In addition to higher pay and much more generous benefits, job security for the government class is ever so much greater than for the average citizen. Civil service rules and union contracts make layoffs rare for government employees. In fact, while Michigan lost 147,000 goods-producing jobs and 153,000 service industry jobs last year, our state’s government sector actually grew by 3,000 new workers.
Michigan’s increasingly impoverished taxpayers aren’t the only losers as government class benefits and wages grow. Services that government provides to citizens are slipping. Money spent on the platinum-clad health and retirement benefits of bureaucrats is not available for Medicaid provider reimbursements or food for senior meals-on-wheels programs.
Sadly for its members, the government class gravy train can’t go on forever. As property values and the economy continue to fall, our state and local governments face significant declines in tax revenues.
Because the generous pay and benefits of government employees are contractually locked in, elected officials eventually must choose between raising taxes on citizens or finally laying off government workers.
Raising taxes contributes to what could be called the “Detroitification” of Michigan - a vicious cycle of hollowing out the private sector to prop up an unsustainable government establishment. The alternative is to finally lay off some public sector employees, which means fewer teachers, firefighters, police and other service providers.
But what if Michigan governments could balance their budgets and significantly cut taxes without laying off any government workers or reducing any services? Impossible? In fact, there may be a way.
If the state constitution were amended to cap the cost of government employee benefits at the same level as the average benefits earned by full-time private sector citizens, taxpayers would save billions of dollars.
Michigan has 411,000 school, state and local government employees, according to the U.S. Census Bureau. These employees (which include elected officials) are among the highest-paid in the nation, and also average $4.05 more per hour in benefit costs than comparable full-time private sector employees.
Capping their benefit costs at the private sector level would save over $8,000 for each government employee and full-time politician, for a total annual savings of over $3.4 billion. This huge savings could be achieved without diminishing government services or laying off a single government employee.
Enacting a state constitutional amendment to cap government employee and elected official benefit costs could turn Michigan around by making significant tax cuts possible without painful service reductions. Government workers would still enjoy higher pay and job security, but they would have benefits comparable to those in the private sector.
It’s long-past time to cap a lucrative government class benefit system that is as unsupportable as it is unfair to Michigan taxpayers. There’s only one question remaining about this proposal: What are we waiting for?
Leon Drolet is the director of the Michigan Taxpayers Alliance. Contact him at leon@mitaxpayer.org. Reprinted from The Detroit Free Press edition on June 19, 2009.
Accolades for Rep. Amash
Rep. Justin Amash, endorsed by the RLC-MI before his highly competitive primary last summer, recently received some attention for his principled voting pattern. From Gongwer News, a couple of weeks ago (subscription required–which is why we didn’t notice this until now):
Rep. Justin Amash (R-Kentwood) isn’t into labels, but five months into his freshman term, he’s getting a reputation.
That’s what can happen when a lawmaker is often the only ‘no’ vote on a bill. Over and over again.
Rep. Justin Amash
We’re happy to report that Rep. Amash’s notoriety is being compared to one of the RLC-MI’s favorite former representatives:
Some observers might say that sounds familiar, a la former Rep. Leon Drolet, who was not afraid to stand out in his caucus and with his voting record.
But Mr. Amash is charting a new course in much different territory as Republicans nationally and in Michigan search to regain their political strength….
Time will tell whether that statement overstates the case, but we’re happy to see Rep. Amash is having an impact so far.
(Check out our legislator rankings in the coming weeks to see how former Rep. Drolet, as well as the other 2005-2006 legislators, voted relative to each other–and relative to a pro-liberty voting record.)
More Proof That Blue Cross of Michigan Should be For-Profit
Blue Cross Blue Shield is a non-profit health care insurance company organized under the laws of the state of Michigan. Quite frankly, it’s hemorrhaging money. This has a lot to do with the fact that its policy is not to turn anyone away, regardless of their health and the risk in insuring them. So unsurprisingly, they’ve had trouble competing with other insurance companies who are more discriminatory in who they cover. Lately, they’ve attempted to raise fees in various areas to stop the bleeding. But Michigan Attorney General Mike Cox, who is vested with jurisdiction over every non-profit organized under the laws of Michigan, will have none of it. Cox suspects Blue is trying to make a profit in violation of its bylaws, and he has used the opportunity to grandstand for publicity arguing he’s protecting “vulnerable seniors” in the name of “consumer protection.” Note the fact that Cox boasts of having the support of both the UAW and AARP in fighting proposed rate increases by Blue.
Smoking ban (in some workplaces) passes
Yesterday, the state house voted to ban certain business owners from choosing to permit smoking in their establishments.
The vote: 73-31.
Republicans: Mildly against, 24-17.
Democrats: Overwhelmingly for, 56-7.
There’s lots to say about this deprivation of liberty, but for now, we’ll leave it at two points. First, let nobody get away with saying that the Democrats are the party more favorable to personal liberties, or at least to keeping vices legally permissible. (See the vote breakdown, above.) Second, it’s a tragedy that Republicans weren’t more solidly against this. They can’t make a credible claim to be a party of liberty if they don’t oppose bills like this, which so obviously restrict the realm of personal choice.
RLCMI MEETING SATURDAY MAY 16TH
REPUBLICAN LIBERTY CAUCUS OF MICHIGAN MEETING
Saturday May 16th @ 1:00 PM
Perkins Restaurant, 5121 28th Street SE, Grand Rapids, MI 49512
Contact Dan Sheill for more information: (734) 223-2197 or dsheill@hotmail.com
Libertarians and the future of the Republican Party
Political Consultant Mike Murphy, a native Michigander and veteran of the Engler 1990 and McCain 2000 campaigns, was on this week’s edition of “Off the Record.” When asked by Skubick whether he agreed that the Republican Party needs to open itself up to gays and pro-choice women, Murphy agreed, noting the Republican Party is essentially a “free market party,” and that “the truth is [today’s youth] are culturally less conservative on social issues than they used to be…some corners of the party don’t understand that the country is changing demographically.”
When asked about the moderate/conservative distinction and former Governor Bill Milliken, Murphy further explained, “we’ve tended to define [conservatism] a little bit backwards…No, the old liberal-republican model is not the answer…I’m personally very sympathetic to the pro-life side, but if it’s the litmus-test of the party nationally, we lose votes we need.”
Kathy Barks Hoffman asked whether Murphy was suggesting that Republicans move away from social issues. Murphy responded, “I think totally going to a moderate position on all social issues is not necessarily the reframing of the party. Most elections are about economic issues, rather than social issues…In most places it’s true that younger voters are culturally a lot more libertarian than they used to be which is hurting us because we’re seen as being disconnected from that.”
Kegger Tax
Introduced 2009 House Bill 4565 (Revise keg beer sale procedures ) to require retailers to attach an identification tag signed by the buyer to kegs of beer when they are sold, and not return the keg deposit unless the tag is still on the keg.
State Chairman Sheill at the Sammies
This weekend I traveled with Chet Zarko of outsidelansing.com to the 2nd Annual Sam Adams Alliance Sammies in Chicago.
John Fund of the Wall Street Journal took aim at Susan Roesgen of CNN and told the audience not to worry about MSM’s efforts to discount the Taxpayer Tea Party Protests because MSM does so at their own risk. The Sam Adams Alliance was instrumental in organizing the main tea party in Chicago. Fund said that while the Democrats convince themselves that the age of Obama will bring a return of 1933 and 1965, he argued that next year’s mid-term elections could very well mirror Democratic defeats in 1978 and 1994.
I was really impressed by the diversity of talent among the young liberty-minded activists in attendance. This included Mary Katherine Ham of the Weekly Standard who presented the Best Video Award to Austin Bragg and Caleb Brown of the CATO Institute for their work parodying the inane liquor control regulations of the state of Virginia. For example, in Virginia, a bartender can sell you a pint of beer and a shot, but cannot sell you a shot inside of a pint of beer! Make sense? No Irish car-bombs in Virginia, but then again, Homeland Security might object to those as well. The video was the most entertaining part of the night.
But by far the moment of the night was when Paul Jacob received the Lifetime Award for his efforts to get TABOR on the ballot in Oklahoma, even in the face of potential prosecution at the hands of the attorney general. Jacob had just earlier presented the Modern-Day Sam Adams Award, and you could see him almost break down in tears as he explained to us all how Sam Adams sacrificed his father’s lucrative beer distillery in order to fight for the freedom (and beer, made by a different family now) that we all still enjoy to this day.
We also personally met Joe the Plumber before the show, who is surprisingly real & cool guy (he called McCain a socialist). All in all I met a lot of great people from across the county and in particular, Missouri, Wisconsin, Minnesota, and of course, Illinois.
-Dan Sheill
Drolet to run for State Senate
Yesterday the Detroit Free Press mentioned that, former state-representative and Republican Liberty Caucus of Michigan advisor, Leon Drolet will run for State Senate. The paper took a shot by saying Leon, “has made a career of bashing government. Now he’ll seek another government job: the state Senate.” The Free Press goes on to mention that Drolet also was a lead speaker at last week’s Tea Party in Lansing, which, according to them, “drew a surprisingly large crowd of close to 5,000.” There is no better way to say this than to say that the Detroit Press Editorial Board is run by a bunch of Obama obsessed socialists. Unfortunately, when (not if) South East Michigan sees the end of one of its major newspapers, it will be the News, and not the Free Press which will disappear.
Beer Tax/Hoekstra
Officer the Record this week addressed a proposal by the Child Welfare insurance Task Force to raise the state’s beer tax from 2 cents a bottle to 5 cents in order to fund social services for foster children.
Also, Pete Hoekstra was the guest, and unfortunately, he failed to provide direct answers to several simple questions. Charlie Cain asked Hoekstra whether he would eliminate the income, sales, and/or Michigan business taxes. Hoekstra said that he has been talking business leaders and individual citizens across the state and the consensus seemed to be getting rid of two of those three taxes. Cain followed up by asking which of the three was he talking about and Hoekstra responded by saying, “I don’t know at this point.” Regarding Congress’ “Cash for Clunker” plan, Hoekstra said he supported “rebates” to buy new cars, but not more “bailout money.” And finally, Hoekstra said he opposes “vouchers” but supports “more educational choices.” Whether or not he intended to doublespeak, Hoekstra needs to do a better job making his positions clear in the future.
