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Indiana may be ground zero for right-to-work fight

December 17, 2011

Indiana’s anticipated battle next month over a right-to-work law is expected to rival last year’s epic Wisconsin union fight that drew 180,000 protestors to Madison rallies and became the focus of national media attention.

Debates over such laws, which ban unions from negotiating contracts requiring non-members to pay dues, have been contentious in most states where they’ve been waged. Indiana caught a glimpse of that intensity early this year when lawmakers put forth a bill and then retracted it after House Democrats fled the state.

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But a confluence of factors is expected to make the upcoming labor-versus-business battle in Indiana among the most heated in decades,

with both sides viewing the state as a key battleground.

For one, Indiana lies in the heart of the industrial Midwest and would become the first right-to-work state in the Great Lakes region, a union stronghold. Indiana’s embrace of the law could influence nearby states—or those with right-to-work leanings—to follow.

Indiana also would be the first state in a decade to pass a right-to-work law, raising hopes among proponents for a victory following a long drought.

And the politics in Indiana, where Republicans control both houses of the Legislature and the Governor’s Office, have strengthened chances of passage.

That is leading national proponents and opponents of right-to-work to marshal dollars and manpower to the Hoosier state.

“Indiana is the only state left where it’s a viable thing. That means a lot of national attention,” said Gordon Lafer, a University of Oregon associate professor in labor education and political science who opposes right-to-work. “All these guys are focused on Indiana, both in terms of publicity but also in terms of communication with the Legislature. And there’s got to be a lot of money.”

Neither side would say just how much money they’re pouring into the battle. The Indiana Chamber of Commerce and other state business groups have begun fundraising drives, and union members are expected to show up in numbers that exceed the 75,000 who protested over 36 days during this year’s session.

Passage of right-to-work would deal a blow to unions in the state and potentially across the country, should other states follow Indiana’s lead. Union membership fell 15 percent in Idaho and Oklahoma after right-to-work laws were approved, according to a February 2011 analysis by two economics professors.

And while data on the law’s economic impact remains inconclusive, proponents tout right-to-work laws’ ability to attract companies that wouldn’t otherwise consider the state.

Opponents, meanwhile, point to studies that show negligible economic impact and lower-than-average wages in right-to-work states after cost-of-living adjustments.

‘The best opportunity’

Right-to-work laws have been a lightning-rod issue since the 1950s, when states began passing them in response to federal labor legislation. Twenty-two states, almost entirely in the South and West, have adopted the legislation. Oklahoma’s law, passed in 2001, was the most recent.

Since then, proponents have been working to mobilize politicians and residents behind the cause, but have not succeeded.

The closest they came was this year in New Hampshire, where both houses of the Legislature approved a bill that the governor vetoed. Lawmakers supporting the bill couldn’t persuade enough lawmakers to override the veto.

Next year, several states—including Kentucky, Missouri, Michigan and Maine—are expected to pursue right-to-work legislation, but those battles face uncertain outcomes. In many cases, experts say, passing right-to-work takes years, if not decades.

Because of its political dynamics, though, proponents are more optimistic about Indiana.

“In 2012, Indiana is by far the best opportunity the right-to-work movement has,” said Stan Greer, senior research associate for the National Institute for Labor Relations Research, which is affiliated with the National Right-to-Work Committee.

In fact, both House Speaker Brian Bosma and Senate President Pro Tem David Long have labeled it their top priority this session. And Gov. Mitch Daniels has said right-to-work would make the state more economically competitive.

“After two to three years of this economy and things not getting much better, I don’t want to drag an anchor we don’t have to drag,” Daniels said.

A victory in Indiana would, at a minimum, prove to be symbolically important for national right-to-work backers.

Because of the geographic dynamics, it also has potential to sway more states to adopt the laws—either immediately or in time.

“Ten years down the road, if Indiana is attracting these jobs, that’s when it starts to have an effect,” said James Sherk, a policy analyst who focuses on labor issues for the Heritage Foundation, a conservative think tank that supports right-to-work legislation. “Having a right-to-work law passed in the heart of the Midwest over time puts a lot of pressure on neighboring states, which is why unions are so adamant about stopping this.”

Unions, however, say they have public sentiment working in their favor. The recent defeat of the legislation in New Hampshire and voters’ November repeal of collective bargaining limits in Ohio will provide anti-right-to-work forces leverage with lawmakers, union leaders say.

“If I were a legislator and listening to my constituents and hearing them flocking into the Statehouse,” said Nancy Guyott, head of Indiana’s AFL-CIO, “I’d be quite concerned about continuing down the road of attacking working families.”

Results unclear

It remains to be seen whether passage of a right-to-work law would make Indiana more successful in attracting jobs.

Groups such as Heritage Foundation say the decline in union organizing—research has shown by as much as 50 percent—following right-to-work passage makes investment more attractive to companies.

The groups also tout lower average unemployment in right-to-work states; in 2010, the rate was 9.2 percent compared with 9.9 percent among non-right-to-work states.

And Heritage experts point to a 1998 Journal of Political Economy study comparing employment in adjacent counties of right-to-work and non-right-to-work states. According to that study, the share of manufacturing jobs in the right-to-work county was a third higher than in the non-right-to-work county.

On the opposite side, Lafer, the University of Oregon professor who has conducted research for the left-leaning Economic Policy Institute, argues there’s no evidence to suggest a shared right-to-work law status explains the lower unemployment among those states.

Further, he said, averaging unemployment data can be misleading. When looked at separately, seven of the 10 highest unemployment states as of June 2011 were right-to-work states; the overall lower average among right-to-work states was influenced by those with very low unemployment, such as Nebraska.

The Economic Policy Institute also produced a study that, after adjusting for factors such as cost of living, showed average annual income in right-to-work states is $1,500 lower per worker than in non-right-to-work states.

Right-to-work proponents attribute that to the fact that many right-to-work states started from a lower baseline and have caught up over the years.

Even though economic evidence is mixed, states’ perception that right-to-work laws influence economic development could wield a powerful influence in the Midwest if Indiana were to adopt such a law.

Randall Eberts, president of the Michigan-based Upjohn Institute, a nonpartisan economic development think tank, said states’ tendencies to adjust their tax structures to respond to changes in neighboring states provides a parallel of what could happen in the Midwest if Indiana becomes right-to-work.

“States are very competitive when it comes to economic development,” Eberts said. “There is some of this copycatting going on.”

What seems to be clearer is the impact a right-to-work law would have on unions, which experts say have lost clout in recent years through a weakening of federal labor laws.

Right-to-work “is just one last step in the gutting of the labor-relations legal system,” said William P. Jones, a labor historian at the University of Wisconsin in Madison.

Building trades unions could be particularly hit because they use union dues for skills training and send out-of-work union employees to sites for specialized work. In the absence of mandatory dues, that structure collapses, said Pete Rimsans, executive director of the Indiana State Building & Construction Trades Council.

While there’s been talk of exempting building trades unions from the legislation, it’s unclear whether they would accept such a compromise or choose to band together with other private-sector unions.

But some disagree that right-to-work would signal unions’ death knell.

Kevin Brinegar, president of the Indiana Chamber of Commerce, said the law’s practical effect would be to force unions to provide better service in order to retain members, as groups like his must do.

“It will make them better if they perform well and convince membership they do a good job,” Brinegar said. “If they take members for granted, it could weaken them.”•

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