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January 11th, 2012
The Right to Work law debate is in the national news — Republican presidential frontrunner Mitt Romney insists it would be good for the country — and it’s a big topic right here in the Great Lakes, too.
Right to Work laws mean employees can’t be required to pay union dues, even if a union is formed in their workplace. There are 22 states around the country with Right to Work laws, many in the South, but there are none in the Great Lakes states, which have long been union strong holds.
On Tuesday, the governors in Michigan and Indiana, who’ve faced off in the past, weighed in on the subject with sharply differing views. Michigan’s Republican governor, Rick Snyder, said passing a Right to Work law is not a priority for him this year, even though some lawmakers say they plan to push for it.
Rick Pluta, at our partner station Michigan Radio, reports Snyder says a Right to Work debate would distract the state from the repair work it needs to do on the economy.
“…to get into a very divisive debate like that, you create an environment where not much gets done and I would point to Wisconsin, I’d point to Ohio. If you look at Indiana, that’s kind of consuming all the dialogue in that state,” Snyder said at the North American International Auto Show in Detroit.
In Indiana, Democratic lawmakers have refused to let the legislature consider the Right to Work law that Republican Gov. Mitch Daniels proposed last month.
Daniels previously had resisted the same efforts Snyder faces. But in his state of the state address, Daniels said,
“Everyone knows that, among the minority favoring the status quo, passion on this issue is strong, and I respect that. I did not come lightly, or quickly, to the stance I take now. If this proposal limited in any way the right to organize, I would not support it. But we just cannot go on missing out on the middle class jobs our state needs, just because of this one issue.”
Daniels faced protestors during his speech, who shouted, “kill the bill” and marched outside the state capitol rotunda.
Where do you stand on Right to Work? Do our Great Lakes states need it to be competitive?
January 6th, 2012
Wrangling over the potential recall of Wisconsin Gov. Scott Walker is heating up, as a Jan. 17 deadline to turn in recall petition signatures approaches.
On Thursday, Waukesha County Circuit Judge J. Mac Davis ordered the State Government Accountability Board to pro-actively screen signatures on the recall petitions of Walker and five other state officials.
In the past, those gathering the recall signatures were the only ones responsible for ensuring signatures on petitions were not fake or otherwise invalid.
The Board warned that the extra verification could take up to eight additional weeks or $94,000. It’s unclear if the state will need to spend that amount of time or resources.
But there was a major caveat in the court ruling. The judge gave the board some breathing room in its decision, saying that their obligation to verify the signatures will be limited by the resources they have or can reasonably find.
Those organizing the recall drive are confident they will have enough signatures on the 17th to allow the recall process to move forward. They’ll need just over 540,000 or one-quarter of the number of voters who cast in the November election. Whatever the review process, it’s likely that more court challenges to the recall drive will happen after signatures are filed.
Walker, who took office a year ago, was at the center of a bitter battle over stripping most public employees of their collective bargaining rights. Voters subsequently recalled some of the lawmakers who voted in favor of a new law, but Republicans retain control of state government.
Read Changing Gears’ coverage of Walker and Wisconsin politics here.
On Saturday, Gary, Indiana officially swears in its new mayor, Karen Freeman-Wilson. She’s actually been on the job since last weekend, though, with a long agenda of big and small goals.
Freeman-Wilson is the first African-American woman mayor in Indiana, where she served as the state’s attorney general. She’s a Gary-raised, Harvard-educated lawyer who has worked in Washington, but feels an obligation to her hometown.
“I know about the good things and the good places. It’s irresponsible to know about the good, to know about the potential, and not do anything about it,” Freeman-Wilson says.
I talked to Freeman-Wilson for this profile in The Atlantic Cities. She also spoke with our partner station WBEZ late last year about the challenges that she’ll face, namely a high crime rate, shrinking population, and citizens who feel they face obstacles in getting what they need.
On a grander scale, she wants to increase service at Gary’s under-served airport, which sits adjacent to Interstate 90; land a major hotel for downtown and spur broader economic development activities.
Freeman-Wilson has collected a series of advisers ranging from Newark’s former business administrator, Bo Kemp, who headed her transition team, to Ronald S. Sullivan, Jr., a Gary native who is now a law professor at Harvard.
Freeman-Wilson says she’s going to hunker down for the next few months to focus on her new job. But if she sees any success at all, she’s likely to become a visible player on the political scene. One of her mentors is Newark’s mayor, Cory Booker, who faced a Gary-like situation when he took office a few years ago.
The new Gary mayor says her Newark counterpart told her, “You really have to understand the difference between campaigning and governing. You have to understand your constituency and communicate with them.”
At least Gary residents know she understands their city. Along with her new job, her biggest priorities are her ailing mother, who lives with her family, and helping her 17-year-old daughter Jordan choose a college (finalists on her list include Columbia University, Howard, and Emory).
January 6th, 2012
It’s been a tumultuous year in many of the Great Lakes states.
New Republican governors in Wisconsin, Michigan and Ohio have pushed for legal and policy changes. Illinois has faced a fiscal crisis. And Indiana’s governor is now backing a Right to Work law.
We know what the political debate has been like. But we’d like to know how the changes are affecting you. What did state government do that mattered to you?
Let us know, and then check in as Changing Gears covers how these leaders are changing the way things are in our states.
January 5th, 2012
Depending on the analyst and the statistic, the Midwest economy is on the mend or still in trouble or somewhere in between.
Getting By, a year-end special from Changing Gears, went beyond the experts and numbers.
Senior editor Micki Maynard and WBEZ’s Steve Edwards gathered at a dining room table with eight Illinois residents from different places and different points of view to discuss the economy’s real world impact on their lives.
We talked about how the recession is affecting everyone, from veterans to business owners, single mothers to people struggling to find work.
Listen to Getting By here and see more photos of the people who took part.
Many of our participants came to us through our PIN network, and we’re always looking for people who can lend their insight. If you’d like to become a source for us, click here.
December 14th, 2011
The incentives war between the Midwestern states has heated up over the past few months, especially between Illinois, Indiana and Ohio, which, are fighting over Sears and the CME Group. Here is a look at how states use incentives to keep or steal companies, and how that effects overall economic development.
Remember the ending? (No? Keep reading.) The movie’s star, Matthew Broderick, wants to show Joshua, the computer, that there’s no way to win a zero-sum game. He gets the computer to play itself, first Tic Tac Toe, then a simulation of a nuclear war between the then-Soviet Union and the United States. In the end, Joshua realizes no one can win.
Keep game theory in mind, because we’ll come back to it later. But that’s kind of what’s happening between Illinois, Ohio and Indiana. These states have spent the past few months waging an economic incentives war worth millions of dollars and thousands of jobs.
The most recent round ended yesterday, when the Illinois Senate approved more than $200 million in tax breaks – specifically designed to keep Sears and the Chicago Mercantile Exchange from leaving Illinois.
The CME Group owns the Chicago Board of Trade, the Chicago Mercantile Exchange, as well as the Chicago Board Options Exchange.
Last week, at a news conference with Gov. Pat Quinn and Senate President John Cullerton, Chicago Mayor Rahm Emanuel echoed their sentiments that much is at stake.
“Chicago Mercantile Exchange allows Chicago and the state of Illinois to be a leader in the futures and risk management industry,” said Emanuel.
Indiana offered CME a reported $100 million to leave Illinois. Ohio offered four times as much to try to lure Sears.
But it doesn’t just happen with big companies. Indiana’s Economic Development Corporation earlier this year spent $50,000 on ads asking lllinois businesses if they were “Illinoyed” by the state’s taxes.
States find themselves over a barrel when officials feel the need to offer millions to lure and retain companies.
That’s a mistake, said Jennifer Bradley, a fellow with The Brookings Institution’s Metropolitan Policy Program.
Bradley said that in the case of incentives, governors and public officials face a classic “prisoner’s dilemma”.
“Governors would probably all be better off, or state economic development authorities would probably all be better off, if nobody got into these kinds of bidding wars,” she said.
In Illinois, the current tax package for Sears was set to expire. The legislation has extended those credits for 10 years for one set of credits, as well as 15 years for a special taxing district in regards to property taxes.
But Bradley says the effort to win jobs from other states may be misguided. She says most research indicates that 95 percent of a state’s typical job growth comes from existing or new businesses.
And here we’re back to the prisoner’s dilemma: with the current game of incentives, though, no one wants to budge.
“If you can’t count on everybody to do the right thing, then nobody’s going to do the right thing,” she said. “So companies have incentives to ask and individual states have incentives, temporarily, to make the offer.”
But some states are playing differently. Michigan is trying something that might break the Midwest out of this prisoner’s dilemma. In his first State of the State speech in January, Gov. Rick Syner rejected the “up the ante” mindset.
“We need to put more emphasis on economic gardening as opposed to hunting,” he said to much applause. “For those unfamiliar with economic gardening, it means we’ll focus first and foremost on building businesses that are already in the state.”
Since that address, Michigan has eliminated almost all of its tax credit incentives – including its much publicized film incentives.
“We’re really trying to provide key access to tools that will help a business’s customer base grow as opposed to just providing them money and hoping that they will be able to grow their business,” said Michael Finney, president of the Michigan Economic Development Corp.
For Finney, that means the focus is more on providing help with accessing export markets, debt financing, and the like. He hopes this approach will also make it easier for the Midwest to work together.
“I happen to think if we worked together as a Midwestern region we’d be much more successful,” he said.
It’s not unprecedented for states within a region to cooperate. Take the South.
“Our former director used the term ‘coop-er-tition’,” said Kathy Geltson, Deputy Director of the Mississippi Development Authority. “We cooperate in instances where it makes sense, but there are instances when it’s a true competition.”
She’s talking about several specific alliances Mississippi and several southern states have formed for industries like the automotive or aerospace center. There, the states work together to bring companies to the region, and don’t try to compete, at least in this case, with incentives.
For Michigan, cutting those hundreds of millions of dollars out was a necessity given its fiscal state. But it works – if Michigan can show that this new strategy will still lead to comparable job growth –maybe other Midwestern states will start to follow suit.
What do you think about incentives? Should it be every state for itself? Or would the region be better served following other models?
And because I can’t resist, in case you’re nostaglic: that final scene from War Games:
December 13th, 2011
Illinois Vote: The Illinois Senate is set to vote today on an incentives package meant to keep the CME Group (better known as the Chicago Mercantile Exchange) and Sears in the state. The vote follows the Illinois House’s approval of the package on Monday. Barring a last minute glitch in the political process, listen for a report from Changing Gears’ Niala Boodhoo on the incentives situation tomorrow.
Michigan Liquor: The State of Michigan is considering changes to the state’s liquor laws, which restrict sales on Sunday and allow local governments to set limits on who can get liquor licenses. The Detroit News reports the Liquor Control Rules Advisory Committee is looking at “anything and everything,” according to one state official. The review is not open to the public, however, and the News says that’s causing some consternation among groups that want the state to take a conservative approach to reforming liquor laws.
Arts Money: Sixty-six arts and cultural organizations in Cleveland’s Cuyahoga County will be sharing nearly $14 million in grants for 2012. Our partner ideastream is among five organizations getting grants of $1 million or more from Cuyahoga Arts and Culture. The group gets its funding from a tax on cigarette sales. Dan Bobkoff reported earlier this year on the unique way the grants are funded.
December 7th, 2011
Detroit faces the possibility that its elected officials will be superseded by a state-appointed emergency manager. It’s happened in four other Michigan cities and there also is an emergency manager for the Detroit Public Schools.
Our partners at Michigan Radio compiled a list of Seven Things You Should Know about Michigan’s law. It’s a complicated situation that’s different from other places in the Midwest, but there are some similarities with what’s been done elsewhere in the United States.
Here are the answers to some questions about Michigan’s law.
Q. Why does Michigan have an emergency manager law?
A: The original process was put in place in 1988, in response to deep financial problems in Hamtramck, an enclave of Detroit . (You may know Hamtramck best as the home of a General Motors plant.) In 1990, the law was strengthened to provide “emergency financial managers” for municipalities as well as school systems that were facing bankruptcy.
Earlier this year, the 1990 law was amended to strengthen the powers of what are now called emergency managers. These managers, who would be appointed by State Treasurer Andy Dillon in consultation with Gov. Rick Snyder, essentially replace elected officials during the term of their appointment.
Q: Can communities still seek bankruptcy?
A: Yes. An emergency manager is considered to be a step taken before a community defaults and seeks reorganization. The state must approve a bankruptcy filing; an emergency manager essentially puts the community or school system into state receivership.
Q: Who has emergency managers now?
A. The cities of Benton Harbor, Pontiac, Ecorse and Flint, and the Detroit public schools. Emergency managers also could be added in Detroit, Inkster and for the Benton Harbor public schools, pending reviews.
Q: What can an emergency manager do?
A: Almost everything but raise taxes. The emergency manager’s most controversial powers include the ability to renegotiate, modify or terminate collective bargaining agreements, with the approval of the state treasurer. The emergency manager also can sell assets, revise local budgets, and hire and fire employees. While elected officials don’t go away, they only have the powers that an emergency manager gives them.
Q: Does an emergency manager serve indefinitely?
A: Emergency managers who govern municipalities are appointed to open-ended terms. Emergency managers for school districts serve one-year terms, subject to reappointment. Once the state deems the city ready to handle its own affairs, the emergency manager is terminated. Flint, for instance, had an emergency manager from 2002-2006; Hamtramck had one from 2000-2006.
Q: How is an emergency manager appointed?
A: Cities considered to be in financial distress are put through a review process. The city can ask for the review, or the governor can ask the state treasurer to begin the review, as Snyder requested for Detroit last week.
Generally, the state asks for a review because of concerns that a municipality will not be able to pay its taxes for state-provided services. The city also may face the possibility that it can’t make payrolls, cover interest payments on debt, or make pension payments.
After an initial review, there may be a second review. Cities and school districts can present plans to the state showing the steps they will take in order to avoid an emergency manager. Detroit Mayor Dave Bing has laid out a program he says will avoid the need for an emergency manager.
Q: Is there anything else like Michigan’s law?
A: The process is something like the review process put in place in 1975 in New York City. (It sparked the famous New York Daily News headline reading, “Ford to City: Drop Dead” — something President Gerald R. Ford never said.)
But there’s a key difference. The Municipal Assistance Corporation was an oversight board; the emergency manager has sole authority.
For more on the emergency manager law, including potential legal challenges, read Michigan Radio’s Seven Things To Know.
Do you think an emergency manager is needed in Detroit? Weigh in.
Pete Bigelow · Governors Provide Weak Regional Leadership Across Midwest, Says Environmental Advocate
December 5th, 2011
The Midwest lacks leadership. That’s a blunt assessment delivered from Gary Wilson at the Great Lakes Echo, a website that covers news related to the Great Lakes environment.
When it comes to issues surrounding the region, he says governors are more interested in stealing companies from each other in a zero-sum jobs battle than confronting – and collaborating on – the region’s economic and environmental challenges.
“They’ve been the antithesis of collaboration and now are singularly focused on creating jobs, many times by trying to pirate them away from neighboring states,” Wilson writes. “That’s when they’re not weakening environmental regulations to create a more business friendly climate.”
Perhaps Exhibit A would be a companion piece on the Great Lakes Compact, a regional accord for safeguarding the region’s water supply that The Echo says came within hours of unraveling because Ohio wanted to make concessions to industry lobbyists.
Wilson eviscerates the regional governors on their track records of collaboration, and also says mayors cannot make the broad impact needed to lead the region. So who can provide leadership? That’s a trickier question.
November 28th, 2011
Members of Detroit’s city council conceded today that state intervention is “likely” in the city’s looming financial crisis. Nonetheless, they are still hoping to corral the city’s $45 million budget shortfall themselves.
The council finalized a list of proposed budget cuts that now goes to Mayor Dave Bing for vetting. Steps outlined by the council are considered even more severe than the ones Bing outlined last week.
They include: layoffs for 500 public-safety employees at a time the city’s murder rate is the highest in the country, reduced salaries for other public employees, increased transportation fares, possibly selling some government property and more. A joint committee with the city’s chief operating officer will be held Tuesday to determine the viability of some of the proposals.
Under state law, Michigan Gov. Rick Snyder could implement a financial review of Detroit’s finances and then choose to appoint an emergency manager, who would have authority to make decisions without the input of the mayor and council and terminate existing employee contracts. The council has bristled at the prospect of losing power.
“We’re willing to push and make sure the folks who people elected to do this are the ones who are going to do it,” council president Charles Pugh told The Detroit News today. “We’re all frustrated.”
Alternatives are being sought. While some groups are contesting the legality of the state’s emergency manager law, members of the council have floated a trial balloon of sorts. Some members told the Detroit Free Press they prefer a compromise position: a consent agreement which would “heighten the authority of the council and mayor to devise a plan – subject to state approval – to save the city from insolvency.”
Such a plan would ensure existing stakeholders have a place in negotiations, but still would give the state the final say.