News Story

Why the Legislature Should Oppose a State Employee Pay Hike

By Senate Majority Leader Mike Bishop editor’s note: Below is the March 3, 2010, floor speech of Michigan Senate Majority Leader Mike Bishop, R-Rochester, urging the Senate to reject a 3 percent pay hike for Michigan’s unionized state employees. The Michigan Civil Service Commission has negotiated the pay hike and the state constitution requires a 2/3 "super-majority" in both chambers of the Legislature to undo the offer.

All of the GOP caucus voted to reject the pay hike except for Sen. Bruce Patterson, R-Canton, who was present but did not vote. Sen. Mickey Switalski, D-Roseville, was the lone Democrat to oppose the pay hike - his statement is here. The measure was defeated when it fell short of the 2/3 majority: Needing 26 of 38 votes to reject the pay hike, it received 22. The text of the measure is available here.

Senator Bishop's statement is as follows:

We spent the better part of an hour debating whether or not we have the money to do certain things, and one of those is a pay increase for employees. And I'd just like to respond very simply by saying no, we can't. It's very obvious that we can't, yet we spend all this time debating and discussing, and we ignore the facts. In fact, for the past three years, we've been mired down in a discussion and a debate about diminishing revenues and what we should do about that; that is an unwinnable challenge for any of us. We have no control.

The harsh reality is we can't afford the government that we have, and as we sit here today, we continue in denial. The denial has reached a level that I have never, could never, predict. We are now at a point where we are looking at the perfect storm, and we are in the heart of the perfect storm.

Consider the facts. The Wall Street Journal listed them; many other papers have listed them as well. Consumer confidence is still down in this country and in this state. The poor continue to feel poor, and some of our friends and neighbors and many others feel poor as well. Most people don't see the end of this crisis--on the outside.

We're seeing record lows in light-vehicle production and sales. That's the bread and butter of this economy, and it's going to continue to get bad in this state until we resolve that. Retail sales are down and remain at record levels that we haven't seen since 1947. Housing starts and property values continue to plummet. Contractions in Michigan's economy have thrown 15 percent of our state residents into unemployment. We've lost almost 1 million jobs this decade; a full third of those happened in the past two years.

We are 55 percent higher than the rest of the nation in unemployment. And if you look at the city of Detroit, our urban center, it is about 30 percent unemployment. It's way higher than any other similar heavy manufacturing base like Pittsburgh, for example, which has a 7.7 percent unemployment, or Cleveland at 11.4 percent.

Not to mention personal income continues to fall. That's a statistic we haven't seen since 1958. Michigan is one of two states that is actually losing population. And as people leave this state, guess what? It's less people contributing to our economic base, which means less dollars to this state--significantly less.

While these statistics are harsh, it's a reality. We can debate all day, but we can't change the facts. All of us have seen the impact on our families, friends, and neighbors. Everybody has seen the impact. Everybody is making adjustments, except state government. And we have the audacity to sit up here and debate this subject as to whether or not we can afford this.

As we debate this here locally, another storm looms larger nationally. The federal government since 1969 has spent more than it has. We've had to borrow to cover that. Our national debt has reached $13 trillion. Our deficit is somewhere around $3 trillion. And as we debate this in our state, we continue to ignore that fact too.

The U.S. dollar continues to lose ground globally. Inflation is soon to follow. The New York Stock Exchange is at a 60 percent rally for no apparent reason. Gold has reached new heights. As my colleague would say, hello.

We have a perfect storm here. And, if we are overly simplistic, we'll just address the symptoms and never address the real problem. You know, as we face the current crisis and that billion-dollar budget deficit that we have, we are talking about a $400 million cut to our public schools, cuts to law enforcement, and local governments. As we decide what we do with that, we're all talking about paying our state employees more. So we are going to pass out pay increases while we cut public education and local government and law enforcement. How much sense does that make? It doesn't make sense. It does not sit well with me, and I do not support it.

The great President Ronald Regan once said, "A leader once convinced a particular course of action as the right one, must have the determination to stick with it and be undaunted when the going gets tough." This may be a tough vote for some of you, but it's the right vote. Do the right thing.


Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.