Snyder caught cooking the books

Many people are aware of Gov. Rick Snyder’s questionable past business practices, but he is apparently bringing some of those practices with him to the public sector when he was busted last week for cooking the books to try and make it look like public employees are overpaid.

The only plan Snyder has let out of the bag on how he plans to make up an estimated $1 billion budget deficit is on the backs of public employees, despite his constant talking point about “shared sacrifice” while he gives his cabinet large raises. To that end, Snyder released a report last week that said public employees are compensated more than double private sector workers.

But the fact is that study after study says when educational level is taken account, public employees are underpaid, like the report last August by respected Michigan State University professor of economics Charles Ballard that said state employees earn less than their private-sector counterparts with comparable educational attainment. The Ballad report also confirmed what we already know: state government is smaller now than it was in 1973. Doing more with less would seem to meet another of Snyder’s meaningless corporate buzz words, “value-based budgeting”

To reinforced and confirm Ballard’s work and debunk Snyder’s cooked study, a study released Thursday by Citizens for Accountability and Reform and the Economic Policy Institute found that public employees in the state are generally paid about market wages, but most state employees are below those market rates. The report showed that after correcting for education levels, state workers have total compensation 9.67 percent less than their private sector counterparts.

According to subscription only Gongwer, Jeffrey Keefe, a Rutgers University economics professor and author of the study, and of several others recently showing public employees around the nation are paid on par with or less than private sector, said the key failing of most studies showing otherwise is not correcting for education level.

"The single most important factor in determining somebody's level of earning in the U.S. is their level of education," he said. For Michigan public employees, 53 percent have at least a bachelor's degree and 17 percent have no more than a high school diploma. Among private sector workers, only 31 percent have a bachelor's degree or higher and 37 percent have no more than a high school diploma.

U.S. Senate Republicans stiff workers to go home and march in parades

Republicans in the U.S. Senate have a nice holiday gift for the many unemployed people in Michigan and across the country as we try and climb out of the Bush recessions: more suffering and the loss of a lifeline that is keeping many people’s heads above water.

The Senate adjourned for the July 4tth holiday without passing six-month extension of unemployment benefits after Senate Republicans filibustered the bill for the third time in three weeks. The vote failed 58-38; 60 were needed to end a Republican filibuster. That means more than 170,000 Michigan residents will see their benefits expire after the 26-week period ends.

Apparently, Republicans like U.S. Senate candidate and Teabagger Sharon Angle of Nevada who said unemployment benefits “spoil” the citizenry in her first and only interview with the real press thinks people enjoy being unemployed. Nevada has the highest unemployment rate in the nation at 14 percent followed by Michigan at 13.6 percent. I doubt few, if any, of those people are enjoying staying at home on "their couches.”

I have never met anyone, although I’m sure their may be a few people out there, who wants to be on unemployment.

The Republicans justification for thumbing their noses at people who want to work is that it will increase the deficit. It makes no sense to worry about a deficit now when we are trying to climb out of the Bush recession; the worst since the Great Depression. Where were they when Bush was squandering the budget surplus and creating the deficit to start and fight an unnecessary war?

Republicans want President Obama and the economic recovery to fail to recapture power, and if a few thousand unemployed workers get hurt in the process, so be it.

Charles Ballard, a professor of economics at Michigan State University, said in the Detroit Free Press that society needs to do more right now to help people running out of unemployment until the nation's economic recovery is on firmer footing.

"At this point, when the recovery ... still feels pretty tenuous, I think it's not appropriate to worry about deficits in the short run," he said.

Senate Republicans find new excuse to hold up DRIC bridge and 10,000 Michigan jobs

LANSING – The Senate Transportation Committee hearings on the much-needed planned Detroit River International Crossing (DRIC) bridge over the Detroit River between Canada and Windsor is proving two things: Senate Republicans are the only people holding it up, and they will do just about anything to help GOP benefactor Matty Moroun keep his monopoly at the Ambassador Bridge.

Republicans all over the country and here in Michigan support building the DRIC bridge, and it seems that the only Republicans who don’t are in the Michigan Senate. The committee hearings on House Bill 4961 that would authorize Michigan to enter into a public-private partnership with Canada and a private sector developer/financier to build the DRIC bridge continued on Wednesday, and Republicans on the Committee raked Wilbur Smith Associates, the company that did the traffic study, over the coals for 90 minutes in an unsuccessful attempt to shake his numbers that we need a second crossing.

But they, apparently, did find something to latch on to, and it appears that is what Senate Majority Leader Senate Majority Leader Mike Bishop, R-Rochester, is going to use to not allow a vote in the bill.

Apparently, unless the Michigan Department of Transportation (MDOT) turns over revenue data on how much money the tolls from a new DRIC bridge would generate, the Senate will not vote on the legislation, according to subscription only Gongwer.

Bishop claims that when MDOT provided the traffic study last May, they should have included revenue data on tolls, but MDOT Director Kirk Steudle said he supplied what was called for and releasing the revenue data would worsen the state's negotiating position when hiring a concessionaire to participate in the public-private partnership that would oversee the new bridge.

“I did release the study on May 1,” he said in replying to a question from Sen. Roger Kahn, R-Saginaw.” As I have testified before, the State of Michigan will be at a disadvantage if I release that data.”

This is such a sham. I can tell you what will happen if the DRIC bridge does not get built. The federal money and 10,000 jobs will go to Buffalo “in a New York minute.”

“I don’t believe for a minute that New York would not hesitate to snap up this up,” Steudle said in Tuesday’s hearing.

Moroun is already in the process of building a second span next to the current one, even though he claims they don’t need a second span and he has also been ordered by the courts to tear it down because he has no permits. His second bridge will never get built for two reasons.

First, Canada does not want the second bridge to land next to the current bridge, and Moroun never get a permit from Canada, no matter how long Senate Republicans hold their breath and jump up and down. Second, when he sees a second span will not be built, he will abandon his current quest to build a second span, and just reap the profits from his 81-year old bridge with little maintenance and government oversight.

The fact is no Michigan taxpayer dollars will be expended on the DRIC bridge. The toll revenue from vehicles that cross the bridge will pay for its construction. In addition, the Canadian government has offered to fund the construction of the bridge plaza and the freeway connection on the U.S. side of the border.

It’s funny; I’m reading a book called “Michigan’s Economic Future” by Michigan State University Economics Professor Charles Ballard published in 2006 by Michigan State University Press. Although I’m only on the first chapter, it’s clear how important it is to Michigan to keep the bridge to Canada open.

He wrote “Michigan is one of the leading gateways to Ontario, the economic heartland of Canada. Trade with Canada is one of the central pillars of Michigan’s’ economy. Michigan has the eight largest economy of the 50 states, but we are the fourth largest exporting state.”

“In the after math of the events of September 11, 2001, heightened security led to considerable congestion at border crossings. Some of the congestion was relived by the opening of new U.S. Customs booths on the Detroit side of the Ambassador Bridge in 2004. Nevertheless, eventually, it will almost certainly be necessary to build a new bridge or tunnel in the Detroit area.”

That was written more than four years ago. That crossing could go to New York if Senate Republicans continue to stall.

The Senate Transportation Committee will again take up HB 4961 Tuesday June 15 at 1 p.m. in the Senate Hearing Room in the Boji Tower in downtown Lansing. The committee meetings are open to the public.

So-called reforms are just same old attacks on state workers

Reform: “the improvement or amendment of what is wrong, corrupt, unsatisfactory, etc.”

Someone needs to send Senate Republicans copy of a dictionary, and once again, their idea of reform is to cut state worker’s pay. Senate Republicans released their so-called “government reforms” on Tuesday, and the target was their favorite whipping boy, public employees.
They are calling for a constitutional amendment to be placed on the ballot in August to require government workers to take a 5 percent pay cut and pay 20 percent of their health insurance premiums. But they expanded their attack to snare all levels of government employees- elected officials like the governor and legislators, state employees, local government employees, teachers and others. Even though Michigan’s economy has changed with the huge loss of manufacturing jobs, the proposal did not include a single tax reform proposal.

It would also cap administrative costs in school districts at 28 percent of the entire district budget, and the proposal also targets the poor; eliminating yet-to-be-determined optional services under Medicaid. After the last budget year eliminated dental benefits, I’m not sure what else they can eliminate. Apparently, the proposal would also eliminate collective barraging, but Republicans hate unions even more than they hate state workers.

This is just another campaign tactic from the GOP caucus where the majority are running for statewide office.

“While reforming how government does business is of critical importance, there are other issues that matter to Michigan families,” said Mike Prusi, D-Ishpeming, the Senate Democratic leader. “I encourage my colleagues from across the aisle to take action on several additional legislative issues before our chamber, including foreclosure assistance, lowering of insurance rates and Hire Michigan First. Reforms will help us in the future, these other proposals help families today.”

State workers have continued to make sacrifices to balance the state budget. In the current budget that was just passed in October that had a $1.5 billon shortfall, it included $28 million in concessions from state employees, and the layoff of 1,500 state employees. State employees have made concessions that have saved the state more than $3.7 billion since 2001.

The myth that state employees are overpaid and state government continues to grow has already been debunked. In August, respected Michigan State University professor of economics Charles Ballard issued a report that said state employees earn less than their private-sector counterparts with comparable educational attainment. It also confirmed what we already know: state government is smaller now than it was in 1973. In fact, state government is only about 80 percent of what it was at the beginning of this decade, and it’s going to get smaller.

The proposal would also eliminate so-called “lifetime health care benefits” for retired legislators who have not vested before January 1, 2010. That’s simply not true. It kicks in only after they are finished with their entire maximum term they can serve and it kicks in at age 55 and is in force until they reach age 65 when Medicare kicks in. It seems Republicans only want the independently wealthy and the retired to serve in the Legislature.

Support for ending harmful term limits is building

Another brief state government shutdown has illustrated what a disaster term limits are, and a recent survey proves people are fed up with the 14-year experiment.

The latest results from Michigan State University’s State of the State Survey - conducted by the Office for Survey Research in the Institute for Public Policy and Social Research (IPPSR) - showed about 61 percent of Michigan residents favored lifting the 14-year lifetime limit on state House and Senate terms to allow politicians to seek office again after a four-year break in service.

The quarterly telephone survey interviewed 1,036 Michigan adults from May 18 through June 30. On a related question, nearly 54 percent of Michigan’s residents favored another change in the state’s legislative term limits – allowing all 14 years to be served in one chamber or the other or divide the 14 years between the two.

Term limits need to be returned to the voters.

Michigan voters amended the Constitution in 1992 to restrict state House members to three, two-year full terms and Senate members to two, four-year full terms for about 14 years. Previous to 1992, there were no limits on the number of House or Senate terms served.

“There are chinks in the armor of term limits,” said Charles Ballard, a respected Michigan State University professor of economics and survey director.

Respected academics and pundits, such as Wayne State University Professor Marjorie Sarbaugh-Thompson, have advocated for returning term limit power to the voters for years. Term limits has led lawmakers to worry more about their next office than good government, empowered lobbyists and given leadership posts to freshman lawmakers.

The massive cuts in the current budget can be blamed on the fact that many in the state Legislatures are more worried about building a record to run for statewide office than good government.

Sarbaugh-Thompson said term limits have not accomplished anything its backers claimed it would accomplish when it was sold to Michigan voters back in 1992.

The survey also found that 82 percent of the latest survey respondents said they favored state legislative districts drawn by an independent, nonpartisan commission instead of by the party that controls the House and Senate. The commission would be charged with drawing the lines to make elections as competitive as possible and without favoring one party or the other. Republicans gerrymandered the districts so badly that even though more people voted for Democrats in the 2006 Senate races, Republicans managed to steal a 21-17 seat advantage.

“The support for an end to gerrymandering is really overwhelming, and among all groups, including Democrats and Republicans,” Ballard said.

The Institute for Public Policy and Social Research (IPPSR), a nonpartisan public policy network at MSU dedicated to connecting legislators, scholars and practitioners through survey, evaluation and applied research, policy forums and political leadership briefings.

Another GOP false talking point bites the dust

Republicans have their favorite whipping boys and boogyman, and in Michigan, state employees are a bigger target than even ACORN.

However, their claim that state employees are overpaid and state government continues grow has already been debunked. In August, respected Michigan State University professor of economics Charles Ballard issued a report that said state employees earn less than their private-sector counterparts with comparable educational attainment. The report also confirmed what we already know: state government is smaller now than it was in 1973. But that hasn’t stopped Republicans, like the rightwing think tank Mackinac Center, from continuing to make the claim that state government is bloated and workers are overpaid.

Republicans have fudged a bit in the face of actual facts, and the new lie is that state workers aren’t making the same kinds of sacrifices the private sector is. An article in the Detroit News last week debunks that lie, and it found that state employees have been hit as hard or harder than private sector workers.

The report said, in fact, that state government is only about 80 percent of what it was at the beginning of this decade, and it’s going to get smaller.

“Michigan's eight-year recession has slashed one in six state workers and one in five state government dollars. Since 2000, the state has shed the equivalent of three auto assembly plants worth of workers -- a busload of employees taking their personal belongings and their last paychecks home every two weeks.”

Tourism has been one of the few bright spots in the Michigan economy as people come here to take advantage of the state’s beautiful and unique natural resources, yet the people who look after those valuable assets, the Department of Natural Resources, has 38 percent fewer employees than in 2000. Agriculture is another bright spot in Michigan, yet one in four Department of Agriculture employees is gone just since the beginning of the decade.

The caseload for Department of Human Services’ workers has risen more than 20 percent since 2000, but the department has lost more than 3,600 employees over that same period.

Demand for government services goes up during a recession because more people need help, yet those services are cut; a fact noted by Professor Ballard.

The Mackinac Center, of course, disagrees, and it claims - even in the face of those facts - that state government has grown during the recession. It says total spending from state resources is up 7 percent in the 2008-09 budget year than in 2001.

But the News debunked that, noting that:

“But those figures don't take into account inflation. While the state's total spending over the eight years increased 7 percent (reaching $27.5 billion in '08-'09), inflation during the same period was triple that (21.7 percent).

“When adjusted for inflation, total spending has decreased 14 percent. Spending from the general fund, the Legislature's main source of discretionary money, is down 21 percent. By comparison, Ohio's general fund was down less than 2 percent, and Indiana's increased 5 percent.”

Another GOP false talking point bites the dust.

State employees are overworked and underpaid

LANSING -- Michigan State University economics Professor Charles Ballard dispelled the myths that the public employee system in Michigan is bloated and that state workers are overpaid and have Cadillac health care benefits.

Ballard recently conducted a comprehensive study on the wages and benefits of state employees on behalf of the unions representing state employees, and he testified on Tuesday before the 13-member House Public Employee Health Care Reform Committee assigned to examine House Speaker Andy Dillon’s, D-Redford, plan to pool all public employees in state, including public school teachers. Dillon claims it will save the state up to $900 million a year.

The first myth he dispelled is that the system is bloated. The fact is state employees are dong more with less.

“We have a reduction of 11,000 workers, which is a reduction of 18 percent since 2001,” Ballard said.

Ballard earned his Ph.D. from Stanford University, and he has been on the faculty at MSU since 1983. He has served as a consultant with the U.S. Departments of Agriculture, Health & Human Services, Treasury and with research institutes in Australia, Denmark, and Finland. He is the author of two books, “Michigan at the Millennium” and “Michigan’s Economic Future.”

Ballard said state employees earn less than those in the private sector, especially those state workers with advanced degrees.

“As the skill level goes up, when you are talking about engineers and attorneys, public employees earn significantly less,” he said.

Ballard also dispelled the myth that state workers get Cadillac health care befits. The fact is they pay higher than average costs for their health care benefits. In fact, most state workers and their families have seen their health care costs double in the last couple of years.

“What I emphasize is that they are not as good as they once were,” he said. “They have made significant give backs.”

Ballard, who has spent more than 20 years looking at Michigan’s tax and budget process, said the tax revenue system is outdated. He said raising taxes made headlines in 2007, but the next day taxes were cut that didn’t make headlines.

“Our tax revenue system is broken,” he said. “To try and fix the budget with just spending cuts is irrational and draconian.”

Right-wing think tank continues to attack state workers

I guess sometimes they can’t help themselves.

As you may have heard, respected Michigan State University professor of economics Charles Ballard recently issued a report that said state employees earn less than their private-sector counterparts with comparable educational attainment, on average. Hard working state employees have been blamed for the state’s budget problems the last few years, and it has become very fashionable to attack and bash them. But, the fact is they have been doing more with less for years.

State employees cost taxpayers $3.7 billion less than eight years ago because of wage and benefits cuts, and 11,000 fewer workers. Under big government advocate John Engler – that’s’ sarcasm for some of my critics – we had 61,493 state employees. In 2006 there were only 52,255 employees. That number continues to go down with layoffs, and the Department of Agriculture, for example, recently ended all inspections of pet shops and riding stables, as an example.

But the Livingston County Daily Press & Argus went looking for a reason to bash the report, and it didn’t have to look hard. In a story that appears at the top of the front page above the fold on Thursday, Ballard made the true statement that state employees have made "considerable sacrifices" in recent years to help the state address its ongoing budget challenges.

That did not sit well with Michael LaFaive, director of fiscal policy for the rightwing think tank Mackinac Center, who said employees in the private sector had made sacrifices too. My question to Mr. LaFaive on a day when all state employees are on an unpaid furlough day: is who said they didn’t make sacrifices?

Here’s the big difference, Mr. LaFaive, no one is bashing private sector employees like they are state workers.

“LaFaive said Ballard's report only takes wages and salary into account, and doesn't include the dollar value of health and other benefits. He said a state worker on average receives $30,000 in non-cash benefits as part of their overall compensation package.”

I can’t imagine what $30,000 in cash benefits he could be talking about. He can’t possibly mean health benefits alone.

If he does, I would compare the cost of health care to that of any private company that has 50,000 employees. It’s a simple fact that the larger the pool the cheaper the cost.

Like every other American, the benefit cost per month for out of pocket, deductibles, co-pays and prescriptions have steadily increased for state employees. In fact, Ballard's study notes that the cost per month for state workers for a family health insurance plan more than doubled what they paid in 2007. In fact, since 2000, premiums for family coverage have increased by 73 percent.

Isn’t time for real health care reform?