The Way Life Should Be. Our motto rings true as Maine consistently ranks high in quality of life. However, for past three years Maine ranked last on Forbes Magazine’s best places to do business list. It’s not surprising considering Maine has the second highest corporate tax burden, third lowest productivity per worker, and a shrinking economy and population. Recently, our legislators had an opportunity to help restore Maine’s competitiveness, and squandered it.
Two bills, LD 831 and LD 786, sponsored by Rep. Lawrence Lockman, R-Amherst, were shot down in committee, despite receiving bi-partisan support. These bills would have ended compulsory dues in both public and private sector unions, making Maine the 25th Right To Work state. There is nothing wrong with unions, if they provide enough benefit to workers to justify the voluntary collection of dues. But when union dues are compulsory, it attacks personal freedoms, and distorts the labor market, making business uncompetitive.
Though no employee can be required to join a union, in many states, like Maine, an employee can be forced to pay union dues or be fired. Workers should not have to pay for the privilege of going to work. Compulsory dues are an added, and often unnecessary, tax on workers. In 2011, unions collected $14 billion from workers paychecks, much of which was spent on political activities to maintain power. Since 1962, unions have gained excessive protection from politicians who benefit from their fund raising, and voter organization capabilities. The basic Constitutionally protected, Freedom of Association, means workers should not be forced to fund these activities.
Maine can no longer afford to grant unions protection from competition. We are currently in a low growth, hyper-competitive, economic climate where efficiency, and productivity matter greatly; unions do not increase either. Unions are a monopoly that distorts labor markets, by restricting supply to push wages above marginal product levels. These cartels, exempt from anti-trust laws, make employers less competitive, ironically, often bargaining themselves out of a job. As the price of labor goes up, employers will purchase less of it, equaling fewer jobs. This makes everyone else worse off: Non-union workers, consumers, employers, taxpayers, and the jobless. Right To Work laws are not just about the unions, they are about all of us.
There has been a migration of corporations from compulsory union states to Right To Work states. Here are the facts. Wages in Right To Work states grew four times faster, private sector payroll increased three times faster, and the private sector economic growth was 4.9%, versus 3.9% in forced union states. Over a ten year period that is 15% more growth. To the Maine economy that could be $7.4 billion. Based on jobs per GDP growth for the previous three years, that would add over 56,000 jobs! This is the difference between our children being able to stay in Maine, and having to leave to find work.
Opponents of Right To Work laws will say this means the “right to work for less.” It is true that average wages are 10% lower in Right To Work states, but if you factor in cost of living, they are actually 4% higher! And it is far preferable to live in a place with higher employment, than fewer people making higher wages. A Brookings Institution study indicated Right To Work laws had lost their effectiveness, citing corporate migration to Right To Work states has slowed in the past five years. A more plausible explanation is that companies would not have had the capital to relocate during the recession. Also, the political environment has been hostile, as was the case of the NLRB’s effort to prevent Boeing from building a new 787 plant in worker-friendly, South Carolina.
Unions have an important job of protecting workers from unfair treatment. If protection is necessary, workers will choose to pay dues. This means the only people who have an incentive to keep forced unionism are union bosses, who’s wages are paid by the hard work of employees, and politicians who receive their donations. The legislative committee members should have at least given these Right To Work bills a fair vote. Maine is a wonderful state that people want to live in, if they can find a job.
Originally Appeared in The Maine Wire