Truth Squad issues warning on ad from 'protectors' of taxpayers

MICHIGAN TRUTH SQUAD ANALYSIS: "MI Way"

Who: Protecting Michigan Taxpayers

What: Internet ad

Truth Squad call: Warning

While the ad does not explicitly mention the ballot measure in question, it is clearly aimed at the Protect Our Jobs amendment, backed by a variety of labor interests. That amendment’s spot on the November ballot remains in doubt, as the Board of State Canvassers deadlocked last week on approving it for the ballot. Supporters are appealing in court. A decision is expected no later than the end of the week.

The Protect Our Jobs amendment appeared last spring in response to legislative discussion in Lansing over Right to Work legislation.

The amendment would add a constitutional protection for collective bargaining rights for employees of the public and private sectors.

Questionable statement: "Michigan is making progress, but Washington (D.C.) union bosses are trying to stop it by tinkering with our state constitution. Why?"

Michigan’s economy, as measured by such factors as the unemployment rate and manufacturing jobs, has been improving since the bottom of the national recession in 2008-09.

While Michigan is generally more unionized in its work force than other states, the rates have been falling. Just among public-sector workers, unionization rates are down in Michigan, too, but are still higher than the national average, than the average in Right to Work states and the average of other non-RTW states.

According to unionstats.com, 17.5 percent of Michigan workers were union members in 2011, though a large disparity exists between rates in the private sector (11.9 percent) and the public sector (52.0 percent).

Union forces are clearly prominent in the Protect Our Jobs effort. In its July report to the state, it showed slightly more than $8 million in itemized contributions. The AFL-CIO State Unity Fund of Washington, D.C., contributed $1.25 million. AFSCME of Washington, D.C., contributed $500,000. International Brotherhood of Teamsters of Washington, D.C., contributed $333,000. National Nurses United of Washington, D.C., contributed $125,000. UFCW of Washington, D.C., contributed $50,000.

However, the majority of the $8 million in the July report came from Michigan addresses, mostly various statewide and local union organizations.

Questionable statement: "Sweetheart deals for special interests enshrined in the constitution. Higher pensions and benefits for governments employees. Forever. In good times or bad. And who pays for it? The rest of us. The middle class pays more, government elites get more."

The National Institute on Retirement Security, a group whose board is populated by managers in retirement programs, says, "Employees of state and local government earn an average of 11 (percent) and 12 (percent) less, respectively, than comparable private sector employees." It added, "Benefits make up a slightly larger share of compensation for the state and local sector. But even after accounting for the value of retirement, healthcare, and other benefits, state and local employees earn less than private sector counterparts. On average, total compensation is 6.8 (percent) lower for state employees and 7.4 (percent lower for local employees than for comparable private sector employees."

But, according to State Budget Solutions, which bills itself as "non-partisan, positive, pro-reform, proactive", but does not appear to provide board member names or funding sources on its website:

"Public employees are receiving pension and retirement benefits that are 337 percent greater than private sector employees. The cost of employee compensation, specifically retirement and savings, averages $0.97 per hour in the private sector. This is compared to the $3.27 per hour that public sector employees accrue."

Michigan’s state and local government retirement systems are protected under Article IX, Section 24 of the 1963 Constitution. So, particular pension formulas and details that result from public sector collective bargaining negotiations do garner constitutional protection. If the "sweetheart" reference is to such pension protections, they have been in place -- and will remain in place -- regardless of the fate of this ballot proposal.

A Senate Fiscal Agency analysis from 2011 attempted to answer the question, "Are Public Sector Retirement Benefits Sustainable?"

The Legislature just completed work on changes to the teacher retirement system to close a $45 billion actuarial gap. Such gaps are not uncommon in other states.

The ad does not explain its definition of "middle class" nor of "government elites."

Overall impression: "Protecting Michigan Taxpayers is a taxpayer watchdog organization, which aims to keep Michigan moving forward by protecting smart, pro-growth policies and ensuring fairness for all taxpayers. The group is working diligently to defeat the destructive Union Boss Ballot Initiative – a proposal by Washington, D.C., union bosses that will forever enshrine their agenda into the Michigan constitution."

The ballot committee was formed June 11, 2012. Its listed treasurer is Jared Rodriguez, who is president of the West Michigan Policy Forum. Prominent West Michigan business leaders such as Doug DeVos and Peter Secchia are members of the WMPF board. In February, Rodriguez authored a newspaper column backing Right to Work legislation for Michigan.

Unlike other ballot question committees this year, PMT has not raised large sums of money so far. In fact, it reported no contributions at all to the state in its July report. It also didn’t report any expenditures, but did reflect $140,000 in debt. The debts are owed to a collection of public opinion and consulting firms with addresses in the Washington, D.C., area.

The claims in the ad are generalized in nature. It is true that pension benefits for public-sector workers are constitutionally protected. PMT’s argument would appear to be that collective bargaining rights for public sector workers make it more likely that such deals will lead to higher wages and pension benefits and, therefore, higher financial commitments on behalf of taxpayers.

It’s true that labor interests are pouring large sums into this amendment campaign.

The ad offers no evidence to its claim that "union bosses" are trying to stop "Michigan’s progress."

Foul or no foul: Truth Squad issues a Warning for the ad’s assertion that backers of the Protect Our Jobs amendment are trying to stop Michigan’s progress. The amendment stems over a policy dispute on the value of unionized labor and, specifically, a Right to Work law.