News Story

Why Michigan’s Free-Market Policy Wonks Are Thankful

People are working, students are learning, pension funds are growing and more

On a day when Americans across the nation are giving thanks, the Mackinac Center for Public Policy has some policies for which they are grateful.

Michigan’s people are working.

The state unemployment rate was 14.6 percent in June 2009. In October of this year, the unemployment rate had dropped to 3.9 percent. There’s nearly a half million more Michigan residents (468,311) working today than in 2009.

No Michigan workers are compelled to financially support political views they oppose.

In June 2018, the U.S. Supreme Court ruled that public sector employees in this country cannot be forced to pay fees to unions as a condition of employment. The landmark decision was known as Janus vs. AFSCME.

That was good news for public school teachers who don’t agree with the far-left agenda of the unions they were forced to support through compulsory monthly payments known as “agency fees.”

In October 2010, the Michigan Education Association’s Voice magazine stated that 45 percent of teachers under the age of 30 in the National Education Association classified themselves as conservative, as did 63 percent of teachers between 40 to 49.

Yet, unions like the MEA and the NEA have a long history of supporting leftist politics.

For example, Doug Pratt, the MEA’s director of public affairs, serves on the board of the far-left organization Progress Michigan. The National Education Association is also polarizing school employees by promoting-far left ideology and positions unrelated to public education. This year, for example, it gave an award to former NFL quarterback Colin Kaepernick, whose national anthem protests further divided an already polarized nation .

Driver responsibility fees ended.

In 2003, in an attempt to generate more money, the legislators passed a “driver responsibility fee” law.

Drivers in Michigan could be forced to pay up to $2,000 in extra fees for multiple or serious traffic violations. Lawmakers were told the levy would generate $65 million a year, but it never did, because individuals on the economic margins of the state couldn’t afford to pay. In testimony on a repeal bill, a Detroit official told a House committee that 76,000 city residents owed more than $124 million (at about $1,629 per resident), most of which would never be collected.

In February, legislation was enacted the repealed the fees and forgave all unpaid fees still owed.

Parents can get their children a better education.

Parents have a choice to get their children a better education. In Detroit, the traditional public schools have failed. The Detroit Public Schools Community District had 69 elementary and middle schools evaluated under the Mackinac Center for Public Policy’s latest report card. A large majority — 55 of the 69 schools, or 80 percent — were given an F grade based on data from 2014 to 2016. The Mackinac Center factors in the socioeconomic background of students into its evaluations so a school’s grade is not just a measure of community affluence or poverty.

The data shows many parents in Detroit are taking advantage of their option to choose a school for their children. According to the National Alliance for Public Charter Schools, there were more students in charter schools in Detroit last year than in the conventional school district. Detroit had 50,460 students attend charter schools and 44,890 attend the local school district in 2017.

While many politicians and public school administrators have complained about charter schools, the latest research from Stanford University’s Center for Research on Education Outcomes suggests that those charter school students are getting a better education than their peers at the conventional district in Detroit.

Underfunding of the largest state pension system has ended.

The Legislature made some changes to prop up the state’s massively underfunded school employee retirement system in 2010 and 2012. But those were measures that fell far short of what was needed. The failure to fix the problem has harmed school budgets.

For example, payments from the Livonia Public Schools to the Michigan Public School Employees Retirement System increased from $11.0 million in 2010 to $24.7 million in 2017. The $13.7 million increase would be have been enough to pay the salaries of 178 teachers within the district.

Much more comprehensive reforms became law in July of 2017. The reforms gave new employees a defined contribution 401(k) account with substantial employer contributions, or a defined-benefit plan in which enrollees are responsible for making up any future underfunding. The reforms will limit the unfunded liability of $29.1 billion and gradually reduce it.

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.