Right to Work is small potatoes – Republicans should focus on real reform
by Christopher A. Erickson, Ph.D., With the state House of Representatives under Republican control for the first time since the 1950s and control of the Senate held by a coalition of conservative Democrats and Republicans, business interests can expect unprecedented influence in this year’s Legislature. In anticipation of this opportunity, the Association of Commerce and Industry (ACI), which serves as the state-level Chamber of Commerce, has met with stakeholders to set its legislative agenda. Its top priority – drum roll please – is making New Mexico a Right to Work state. What a small ball! Right to Work just isn’t that important. Why is the business community squandering the historic opportunity given them by the Republican election victory on such a petty issue? It defies explanation. Right to Work laws prohibit agreements between unions and businesses that require workers to join an established union as a condition of employment. Businesses like these laws, as they reduce labor’s bargaining power. Unions oppose these laws for the same reason. Libertarian types, like yours truly, object toRight to Work as an unwarranted government intrusion into private transactions. But the real problem with the business lobby’s focus on Right to Work is not whether it’s a good or bad idea but that it just isn’t that important, having almost no effect on economic development. A quick look at the data shows the little importance of Right to Work. The fastest growing state over the last decade, for example, is North Dakota, a Right to Work state. The second fastest growing state is Oregon, which is not Right to Work. At the other end of the spectrum, the two slowest growing states – Nevada and Georgia – are both Right to Work. More systematic studies find similar results. Right to Work appears to have either no statistically significant effect on growth or only a very small positive effect. Other factors, such as the overall cost of doing business or the availability of a trained workforce, swamp Right to Work in importance. If business wants to promote economic development, what policies should they be pushing in the Legislature? First and foremost is K-12 education reform. Restore the funding cut from the education budget that was made during the Great Recession. Reduce class sizes to, say, 25 students per class. Reform educational funding to give more discretion to local school districts. Give educators the resources they need to teach. Next, business should lobby for reduction of the state government workforce. New Mexico currently ranks fifth among the 50 states for state and local employees as a percentage of total population. Don’t lay off people, that would generate too much opposition. Instead, implement a systematic program to replace people with technology whenever possible, using attrition to create salary savings. These two policies K-12 reform and government workforce reduction would substantially improve New Mexico’s competitiveness, helping existing businesses to expand and making it easier to attract new businesses. These are the kind of policy changes that can make a real difference. Christopher A. Erickson, Ph.D., is a professor of economics at New Mexico State University. He has studied the New Mexico economy for nearly 30 years. The opinions expressed may not be shared by the regents and administration of NMSU. Erickson can be reached at chrerick@nmsu.edu.