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Latest News - February 2011

February 2, 2011
Giving Workers A Union Choice
Source: Wall Street Journal

One of the under-appreciated fault lines in the U.S. economy is between the 22 "right-to-work" states and the rest of the country. The former have tended to do much better economically. Now some non-right-to-work states such as Indiana, Wisconsin and Michigan are thinking about joining this club that allows workers to opt-out of union membership.

Contrary to much union rhetoric, right-to-work laws don't ban or bust unions. They simply grant individual workers the right to join or not to join, even once a workplace is organized by a union. Workers who decline to join the union can't be forced to have dues taken out of their paycheck and thus used to finance union political campaigns. Most right-to-work states are in the South and West, and only Oklahoma has adopted this freedom to choose in the last 20 years.

Right-to-work states outperform forced-union states in almost every measurable category of worker well-being. A new study in the Cato Journal by economist Richard Vedder finds that from 2000 to 2008 some 4.7 million Americans moved from forced-union to right-to-work states.

The study also found that from 1977 through 2007 there was "a very strong and highly statistically significant relationship between right-to-work laws and economic growth." Right-to-work states experienced a 23% faster rise in per capita income over that period. The two regions that have lost the most jobs in recent years, the once-industrial Northeast and Midwest, are mostly forced-union states.

Indiana is a case study in the negative effects of forced unionism. Governor Mitch Daniels recently explained why his state lost a bid for a new Colgate factory that would have employed hundreds: "We did absolutely everything we could do. . . . We made an offer we believe was competitive in every other respect, but they [Colgate] want to be in a right-to-work state."

Mr. Daniels adds that the lack of a right-to-work law "does hold us back economically. There is no doubt about it." He estimates that when competing with Southern states for businesses, "a very large number—perhaps as many as a quarter—of the deals we don't get a shot at are for just this reason."

This damage has motivated Indiana Republicans, who now control both legislature chambers, to announce that they want to pass a right-to-work law. Unions immediately went to Defcon 1, Democrats are up in arms, and Republicans could yet buckle under this union pressure. Even Mr. Daniels, who has stood up to union opposition in the past, seems hesitant. He told the Indianapolis Star that right to work "may be worth a look," but he added it "is not on my agenda." He's worried that the issue so antagonizes unions that it could derail the rest of his legislative agenda.

We hope Republicans don't flinch. Right-to-work laws make states more economically competitive, but the bigger issue is about individual rights. Workers should have the right to join a union but also the right not to. Indiana and other states with new Republican majorities have a rare opportunity to pass a major reform that will reduce union power, help to attract new jobs, and liberate workers from union coercion.



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