Two Americas Exposed

Data indicate that worker-choice benefits workers

The Bureau of Economic Analysis last week released economic growth numbers, on a state-by-state basis, for 2007. Some familiar patterns emerge, with a few outliers, as usual. The general rule of thumb: Pro-growth states produce more growth. Pro-government states produce less growth. Pretty obvious stuff. I decided to drill down a bit more, though.

I wondered what impact labor laws have on growth, so I looked at the total state economic growth (Gross State Product, or GSP), and compared it with whether a state is a Right To Work state or a Forced Unionization state.

Some fairly intuitive results (although this may shatter a left-winger's understanding of this subject):

From 2004-2007, no Right To Work state grew less than 5.1%, while fifteen Forced Unionization state grew below that level.

Meanwhile, while America's GDP growth from 2004-2007 by 8.4%, Right To Work states grew by 10% on average, while Forced Unionization states grew by only 6.2% on average. The median Right To Work growth rate was 9.2%, compared to the median Forced Unionization rate of 4.9% (the national median for all states was 7.3%).

Clearly, John Edwards was onto something back in 2003/2004 when he said there were Two Americas. Since that time, there is a pretty clear bifurcation of economic results, along labor law lines.

Unfortunately, as a friend and champion of union bosses, one of Edwards' more prominent prescriptions for the alleged Two Americas problem was to make all of us more like the Forced Unionization states.

That idea might reduce inequality, all right. It might very well eliminate the Two Americas. If John Edwards (or, for that matter, Barack Obama) had his way, we'd all have slower growth. But, hey, it would be fairer.

While not all Republicans at the state level are pro-growth, and not all Democrats are pro-regulation/pro-labor/pro-government, the trends generally follow the red/blue states we've come to know and love in recent years.

Clearly, letting labor union bosses write labor laws in a state retards economic growth. Why this bit of "duh" is so counterintuitive to some people is baffling to me.

If you'd like to check out the Microsoft Excel file with this data, you can look at the raw data (.xls) at the BEA site, or you can download the file I created here: (Excel Spreadsheet).


Worker choice scheme picks up steam

Related story: "The 28 labor-states"

Colorado may abandon forced-labor unionism

The Right-to-Work initiative picked up some more prominent backers this week. The Northern Colorado Home Builders, Independent Bankers and Colorado Petroleum Marketers Association all endorsed Amendment 47. The measure, if passed in November, would bar union shops in private businesses, essentially allowing workers to opt out of union membership even if the workplace had voted to be unionized. The new supporters touted the amendment as being good for business, arguing that 22 states with right-to-work laws show better job growth and economic performance.

Opponents of the measure have filed a lawsuit to keep it off the ballot, alleging that backers used fraud and deception in gathering petition signatures.

Local links

The national free-market grass-roots group Americans for Prosperity has launched a new chapter in Colorado, and it has its share of El Paso County connections.

Jim Pfaff, former president of the Colorado Family Institute, is the state director for the organization, which also has chapters in 21 other states. And state Rep. Kent Lambert, R-Colorado Springs, spoke at a recent news conference celebrating the launch.

AFP's goal is to mobilize voters on economic-policy issues that advocate limited government and fiscal restraint, according to its Web site.


Gov't unions facing massive dues hit

Unionism will force politicians to clash with taxpayers

Falling sales and income taxes, combined with rising energy costs, continue to erode state finances according to a report released today by the Nelson A. Rockefeller Institute of Government, the public-policy research arm of the State University of New York. Most states are required by law to balance their budgets, so weak tax revenues have already resulted in budget cuts in states across the country, from less frequent trash collection to teacher layoffs.

State budgets are poised to get worse, and further cuts almost a certainty. Much of the revenue collected in the first quarter reflects last year’s much better economy, rather than this year’s lackluster economy. Also, while withholding taxes are collected over time, taxes on other income such as investments, stock sales or corporate bonuses are often paid in the first part of the year. That resulted in a revenue spike that isn’t likely to carry over into the current fiscal year.

“It’s likely that the second quarter will be worse for states,” says Robert B. Ward, deputy director of the Rockefeller Institute.

States are being squeezed from both ends. Corporate profits are down; so goes corporate income taxes. Consumers are also spending less: Sales taxes were flat in the first quarter compared to the same period a year ago. Overall state revenues increased 1.7% in the first quarter of 2008, the weakest in five years. Revenues declined about 5.3% after adjusting for inflation and tax changes (that could be tax cuts or tax increases, but most of the decline is due to inflation).

At the same time the cost of government expenditures (everything from gas for fire engines to health care and pension plans) are rising faster than prices in other sectors of the economy. Inflation is running around 6% for state and local government, compared with a little over 2% for the broader economy.


Surge of gov't employers adopting 4-day week

Work-cut will result from future bargaining

So maybe there’s a silver lining to skyrocketing gas prices after all. Seeking to reduce state energy costs, Utah Governor Jon Huntsman announced Thursday that the state would close administrative offices on Fridays, while extending hours on Monday through Thursday.

The idea is to work longer during the week and reduce the amount of trips to and from work.

Following suit just in time for soaring summer gas prices is New York’s Suffolk County Legislator Wayne Horsley. His plan: Let employees work four 10-hour days from July 1 through Sept. 30.

And with no gas respite in sight, the concept is spreading to states such as California, West Virginia, Minnesota and Georgia.

But a 4-day work-week could create change that goes far beyond saving money and energy. According to an article in human resources journal Workforce Management, it could lead to “a revolution in the office that will result in productivity being the central value of work, rather the number of hours logged by employees.”

And just in case the short workweek just doesn’t cut it for cost-savings, government officials could urge their cities fire-fighters to follow those in Vandalia, Ohio, and trade in their gas-guzzling red fire trucks to ride bicycles from site to site.


City of Brotherly Racist Unions

'It's a joke.'

The ongoing stink between the city and its labor unions over increasing the numbers of minorities and women in the construction industry reminds me of the story of the farmer who discovers an enormous pile of horse manure in his barn. How does he address it? Is he the doom-and-gloom pessimist who frets about whether he will be able to shovel it all out? Or is he the eternal optimist who figures, hey, underneath all the mess, there's got to be a pony somewhere? After generations of the trade unions refusing to do the right thing, I've got to say, I'm having one heckuva hard time finding the pony.

Listening to testimony at the first public hearing of the Mayor's Advisory Commission on Construction Industry Diversity last week at City Hall, I'm beginning to think the mayor needs to sign off on a purchase order for extra shovels.

Union leaders and the select members they protect like to say that women and minorities just can't pass the test, or that the contractors ask for their favorites, or that seniority takes precedence.

But Shencaqua Butt, a journeyman carpenter, wasn't buying any of the usual excuses - not when the new mother was forced onto welfare for lack of work over the last year and a half.

This after going through a five-year apprenticeship program and passing both the painters' and carpenters' tests.

'A joke'

Butt, an African American who is a member of Local 1073 of the Metropolitan Regional Council of the United Brotherhood of Carpenters, testified that she went through all the channels, appealing to her shop steward, the union's business agent, even the executive secretary.

"It's a joke," she said. "If I hear, 'You know how it is,' one more time. . . . Had I known how it was, I would have never gone into this."

And there was John Dent, a retired heavy-equipment operator who pointed out that after years of protracted litigation, his union, Local 542 of the Operating Engineers, still hadn't achieved the goal of 21 percent parity since black union workers first filed a discrimination suit 37 years ago.

If four federal judges - starting with the formidable A. Leon Higginbotham Jr., a lifelong champion of civil rights who wrote the landmark decision - can't offset the union's lack of good faith, you wonder who can.

"I don't expect to see full integration in my lifetime," Dent said sadly.

Four hours of testimony by union members, construction owners and contractors painted a colorless and womenless picture of institutional barriers and outdated practices that have over the years prevented the identifying, training and hiring of qualified minorities.

Add to that mix a glaring lack of oversight and, intentionally or not, minorities and women - in a city that boasts a majority minority population - find themselves shut out of the trades.

Mayor Nutter aptly calls it "economic apartheid."

In January, City Council mandated that 50 percent of the jobs for the $700 million, two-year Convention Center renovation go to women and minorities, and that 50 percent of those workers must live in the city.

According to union numbers submitted to Council earlier this year, about 80 percent of the regional construction workforce is white, and about 70 percent lives outside the city - as far away as the Eastern Shore of Maryland.

Good luck finding a pony in those dismal totals.

Head to head

But commission chair Carl Singley sees reason for hope. For one thing, this is the first time a Philadelphia mayor has taken on the politically powerful unions with the full backing of state and local government.

"I've never seen this kind of consensus with such a broad base of elected officials," says Singley, a Philadelphia lawyer who also sits on the Convention Center board.

Once again, it shows that Nutter - to paraphrase one of his-often repeated phrases - isn't playing.

"You can't enact a whole bunch of laws. What you need is the collective political weight and say, 'We want to see some changes,' " says Singley. "And guess what? Things will change."

Singley says he'll push the city to implement and enforce the recommendations his commission plans to make by Sept. 1.

After generations of futile back and forth, let's hope that any owner, contractor or union doing business with the city finally gets the message.

"This is public money," Councilwoman Donna Reed Miller said. "Public means everybody."

Too bad most union leadership didn't bother to show up to hear that message.


Landrieu's damaging anti-democratic proposal

Employer warns of jobletting

The “Employee Free Choice Act” is the newest serious threat to America’s economy and business environment. I’m concerned why one of our own Louisiana elected officials — U.S. Sen. Mary Landrieu — is helping push this legislation by co-sponsoring it. It seeks to unfairly and dramatically tip the odds in big labor’s favor by “streamlining” the workplace unionization process.

When a workplace is considered for unionization, a crude “card check” method — the collection of a certain number of signatures — would suffice for unionization. This would end the current private ballot election process that is used. Because this method makes it so much easier for labor officials and peers to cajole and intimidate employee votes, unions win far more often than they ever would in real elections.

The subsequent nationwide explosion in union membership and revenue would result in a serious economic slowdown. Baton Rouge, let’s stop this and let our senator know our stance.

Charles Henry, contractor, Baton Rouge


NYT trims News Union dues from web ops

Employer outsources high-growth segment

Reciting the outsourcing mantra is a required ritual for any self-respecting Democrat office seeker this cycle. Obama and Clinton both took up the battle cry in the primaries to rally big labor bosses and agitate the rank and file. Assisted by their allies in the drive-by media like the New York Times and NBC News, the candidate's rhetoric was reinforced with strategically placed stories to amplify the propaganda.

For observers interested in exposing media hipocrisy, the announcement that the New York Times is outsourcing their internet operations to a unit of Mumbai India Newspaper publisher Deccan Chronicle is a most delicious nugget.

Apparently Local 3 NY Newspaper Guild is unconcerned that the Times is outsourcing jobs in the highest growth segment of the company. The guild is supposedly monitoring layoffs and ignoring outsourcing.


Teamsters warn against Bud sale

Teamsters/InBev web page: here
Related A-B/Teamsters stories: here

Suitor challenges Teamster control of Capitol Hill

Anheuser-Busch’s rejection of a $46 billion takeover bid last week means there’s a lobbying war brewing here in Washington. You might call it a brewhaha. The increasingly hostile suitor InBev, a global brewer based in Belgium, has assembled a lobbying force in recent weeks and will utilize that muscle to continue to pitch its claim that the deal would benefit Anheuser-Busch shareholders, workers and communities.

Anheuser-Busch, meanwhile, unveiled a defensive plan to boost the company’s value on Friday, a day after its board unanimously rejected InBev’s bid as “financially inadequate.”

And the iconic St. Louis-based brewer has quite a bit of long-established lobbying heft to get congressional and state lawmakers on its side.

“We are focused on educating lawmakers on the reasons supporting the board’s decision, including the merits of Anheuser-Busch’s strategic plan to generate growth and why this plan is the most effective way to increase value for the company’s shareholders,” Anheuser-Busch’s vice president of legal and government affairs, Gary L. Rutledge, said in a statement.

“Anheuser-Busch has for many years maintained a significant presence in Washington, D.C., and in state capitals throughout the country and we are well-prepared to effectively represent the interests of the company and its shareholders on this issue,” Rutledge said.

The company could get some significant help from other groups opposed to the deal.

Some state chapters of the National Barley Growers Association are calling their congressional representatives to voice their concerns about what Anheuser-Busch’s sale could mean for their business. America’s largest brewer is a big customer for local growers; Anheuser-Busch buys 75 percent of the barley grown in Montana, North Dakota and Idaho, said the NBGA’s vice president, David Henderson, who lives in Cutbank, Mont.

“We are very concerned,” he said. Growers worry about lower crop prices, lost contracts and a foreign business culture, he said.

“When you’re an Anheuser-Busch grower, it’s a special thing. They treat you very well,” Henderson said. “You’re dealing with an American-owned company. If something goes wrong, you don’t worry about calling them ... and voicing your concerns.”

Citing the benefits Anheuser-Busch suds have brought to small towns in Montana, Sen. Jon Tester (D-Mont.) told The Associated Press that he’d support congressional efforts to derail the InBev deal.

Another potential Budweiser ally is the International Brotherhood of Teamsters, which represents workers in some Anheuser-Busch breweries. While the Teamsters haven’t staked an official position on the potential sale yet, a Web page on their site dedicated to the deal would give any Anheuser-Busch worker pause.

For instance, addressing the question of whether the buyout would be good for Anheuser-Busch, Teamsters official Jack Cipriani points to cost-cutting by other foreign brewery buyers. “Workers don’t always fare well when outside conglomerates buy breweries. Since South Africa Breweries took over Miller Brewing’s U.S. operations, it has demanded hikes in workers’ health care costs, elimination of overtime after eight hours, elimination of seniority rules and drastic cuts in staffing levels.”

Missouri’s congressional delegation was already protesting InBev’s bid before Anheuser-Busch rejected it. But InBev could get heat from a number from other states — and their politicians — in which Anheuser-Busch operates if workers and voters there sour on the deal.

The company operates a dozen breweries in as many states, providing not only jobs but also millions in property taxes to state and local governments. Anheuser-Busch employs more than 9,600 people in Florida — more than in its home base of Missouri, where 7,200 people are on the payroll.

InBev stresses that it plans to “maintain all of Anheuser-Busch’s U.S. breweries.” But that hasn’t stopped politicians and others from fretting that InBev would still cut jobs.

In response, InBev appears to be working hard to make sure the political backlash to its proposal doesn’t swell to dangerous proportions.

The Belgian-Brazilian brewer has demonstrated significant savvy in the politics of foreign acquisitions in the United States. Rather than stumble unarmed into a patriotic firestorm, as other foreign buyers have done, InBev assembled a lobbying and public relations team that includes the firm run by former Senate Majority Leader Trent Lott (R-Miss.) and former Sen. John Breaux (D-La.); the lobbying firm of Johnson, Madigan, Peck, Boland & Stewart; and The Glover Park Group, a strategy firm specializing in wide-ranging influence campaigns.

Last week, InBev officials made the rounds on Capitol Hill, visiting with lawmakers from Missouri and a few other states.

Members of InBev’s team declined to give out details of their post-rejection strategy but said that it includes reaching out to local officials across the country as well as to members of Congress.

InBev plans to actively communicate with elected officials at the local, state and federal levels “to educate them and communicate to them the value of this transaction and the opportunity that will be created by a combined company,” said a source familiar with the company’s strategy. “They feel very strongly that this is a great thing for Anheuser-Busch.”

It’s likely that part of InBev’s pitch will stress that Anheuser-Busch’s plan to ward off the takeover includes cutting jobs, while its bid would result in significant growth, as the company claimed in its initial press release.

The Budweiser maker has plenty of ammunition of its own, not least of which are some deep pockets.

The company rang up a $3.4 million lobbying tab last year, according to the Center for Responsive Politics. Anheuser-Busch employs more than a dozen firms, and that army includes heavy hitters such as hometown boy and former House Majority Leader Dick Gephardt (D-Mo.).

The King of Beers is also among the royalty of political giving; its PAC and employees have donated more than $1.2 million this election cycle. That’s on pace to surpass the $1.4 million the company donated during the 2004 presidential campaign.

Budweiser already has the backing of the Missouri delegation. Republican Sen. Kit Bond has asked the Federal Trade Commission and the Department of Justice to scrutinize the deal, even though business experts see little chance that there’s a real regulatory problem.

But since beer hasn’t been a major national security concern — at least so far — and the would-be buyer is based in a close European ally, Congress appears to have little impetus to block the deal based on concerns about foreign investment in the U.S. (Under pressure from Congress, the Middle Eastern company Dubai Ports World backed out of a deal to run several American ports in 2006.)

There’s more danger of policy weapons being unleashed at the state level, said Columbia University law professor John C. Coffee. In the past, several states have taken steps to block foreigners from buying favored businesses, including passing narrowly tailored anti-takeover statutes, he said.

In 2002, the state of Pennsylvania went to court to try to block the sale of Hershey Foods. European countries, however, have blocked equally benign foreign acquisitions when the company was considered as iconic as Anheuser-Busch, noted Gary Clyde Hufbauer, a foreign investment expert at the Peterson Institute for International Economics.

“It seems a real stretch here” for Congress to try to scuttle the InBev deal, he said. But if the hostile bid becomes a campaign issue — unlikely unless Barack Obama weighs in, Hufbauer added — the game could change.

“If you get enough congressmen thinking it’s inappropriate, they will invent some reason” to block it, Hufbauer said.


NLRB smacks down Fi-Core members

Related Fi-Core stories: here

Dissenters forced to shoulder career-threatening burden

The US Government National Labor Relations Board has decided in favor of Los Angeles AFM Local 47 as regards their policy of denying access to Local 47 rehearsal rooms for Local 47 “non-members” who have chosen financial core status, also known as “Beck objector” status.

As first reported in Film Music Magazine in late 2007, financial-core musicians were prohibited from using rehearsal rooms at Local 47. Professional violinist Sai-Ly Acosta who has played for the New Era Scoring financial core orchestra filed a federal unfair labor practice charge with the National Labor Relations Board (NLRB) after union officials enforced a policy, labeled as “illegal” by the National Right to Work Legal Defense Foundation, requiring all musicians to be “in good standing” with the union in order to practice in a union-owned rehearsal facility with an orchestra which is represented by the union under a collective bargaining agreement.

Musicians who choose financial core status pay reduced dues to Local 47 but are allowed to work both union and non-union jobs without the threat of fines or expulsion from Local 47.

The choice by Local 47 to deny access to rehearsal rooms to financial core musicians who still pay Local 47 for services seems destined to divide the community further, and puts contractors and employers in the difficult spot of having to exclude financial core members of orchestras from rehearsals at Local 47, an action that could create employment problems for those musicians.

“I think it’s important to note that this is perhaps not over, and may be weighed by the courts since the board had not enough wisdom to see this for what it is; a labor organization inappropriately with it’s hand in the functions of the employer, and the employer reluctantly with it’s hand in the pocket of the union. Cheap rental space is not free; it comes at a high cost. I remain financial core,” stated John Acosta, husband of musician Sai-Ly Acosta.

Industry sources indicate that a federal lawsuit against Local 47 in this matter may be forthcoming.


NEA members to speak out against union

Mission creep, misuse of members' dues

Family Research Council on Wednesday, July 2, at 9:30 am will host representatives of the group Pro-Life Educators and Students as well as other noted pro-life leaders to criticize the National Education Association's pro-abortion policies and resolutions. The group will then picket outside the NEA gathering at the Washington Convention Center. The prime reason for the existence of the NEA is for the collective bargaining power it gives to its members. It is not the job of the NEA to issue mandates on social and moral issues and to do so is a misuse of members' dues and misrepresentation of teachers' views.

Who: Bob Pawson - ProLife Educators And Students (NEA member)
Sissy Jochmann - NEA Conservative Educators Caucus (NEA Delegate)
Judy Bruns - Teachers Saving Children (NEA Delegate)
Chuck Donovan - Exec VP Family Research Council
Becky Banks - Students for Life of America
Rev. Clenard H. Childress - BlackGenocide.org
Jim Sedlak - VP American Life League
Peter Shinn - Pro-Life Unity
Missy Smith - Women Against Killing and Exploitation of Unprotected
John Tomicki - League of American Families

What: NEA and Abortion News Conference
When: Wednesday, July 2, 2008, 9:30 am
Where: Family Research Council, 801 G Street, NW, Washington, DC 20001


Teamster cards create fear, confusion

Collectivizing in uncharted territory

A local chapter of the International Brotherhood of Teamsters has collected about 1,100 signatures from Denver city employees who want collective bargaining power. The Teamsters, Local 17, which already has about 800 city employees as members, plans to submit the signatures to City Council President Michael Hancock next week, said Ed Bagwell, a union organizer. But it's unclear what will happen next.

The city attorney's office has said that the council doesn't have the authority to grant collective bargaining power and that the decision rests with voters.

The Teamsters disagree.

They say a voter-approved charter change in 2003 opened the door to empowering the council to approve collective bargaining.

Bagwell said the matter could end up in court.

Even though about 7,400 employees are eligible, Bagwell said, many employees declined to sign the petition because they face "underlying pressures" on a daily basis.

"There's an undercurrent of fear of signing anything that will get you into trouble," he said Tuesday morning after Mayor John Hickenlooper delivered his fifth annual State of the City address.


IBEW leaflets worksites for Barack

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