Why Unions Want a Higher Minimum Wage

Labor contracts are often tied to the law—and it reduces the competition for lower-paying jobs.

By RICHARD BERMAN - tHE WALL STREET JOURNAL

Organized labor's instantaneous support for President Obama's recent proposal to hike the minimum wage doesn't make much sense at first glance. The average private-sector union member—at least one who still has a job—earns $22 an hour according to the Bureau of Labor Statistics. That's a far cry from the current $7.25 per hour federal minimum wage, or the $9 per hour the president has proposed.  Altruistic solidarity with lower-paid workers isn't the reason for organized labor's cheerleading, either.

The real reason is that some unions and their members directly benefit from minimum wage increases—even when nary a union member actually makes the minimum wage.

The Center for Union Facts analyzed collective-bargaining agreements obtained from the Department of Labor's Office of Labor-Management Standards. The data indicate that a number of unions in the service, retail and hospitality industries peg their base-line wages to the minimum wage.

The Labor Department's collective-bargaining agreements file has a limited number of contracts available, so we were unable to determine how widespread the practice is. But the United Food and Commercial Workers International Union says that pegging its wages to the federal minimum is commonplace. On its website, the UFCW notes that "oftentimes, union contracts are triggered to implement wage hikes in the case of minimum wage increases." Such increases, the UFCW says, are "one of the many advantages of being a union member."

The labor contracts that we examined used a variety of methods to trigger the increases. The two most popular formulas were setting baseline union wages as a percentage above the state or federal minimum wage or mandating a flat wage premium above the minimum wage.

Other union contracts stipulate that, following a minimum-wage increase, the union and the employer reopen wage talks. The negotiations could pressure employers and unions to hammer out a new contract, regardless of how long their existing contracts last. Presumably the reopened negotiations could also prompt an employer's demand for union givebacks, but that possibility does not seem to scare the unions.

Minimum-wage hikes are beneficial to unions in other ways. The increases restrict the ability of businesses to hire low-skill workers who might gladly work for lower wages in order to gain experience. Union members thus face less competition from workers who might threaten union jobs.

This view is not speculation. A 2004 study in the Journal of Human Resources by economists William Wascher, Mark Schweitzer and David Neumark determined that lower-wage union workers typically see a boost in employment and earned income following a mandated wage hike. Never mind the corresponding drop in jobs and earned income for nonunion minimum-wage workers. They may have been priced out of the jobs they need, but that is not the union's concern—its members have landed higher wages and reduced competition for jobs.

Such considerations are worth keeping in mind when contemplating the president's wage proposal and the fervent Democratic support for similar and often more ambitious measures, such as Iowa Sen. Tom Harkin's bill to raise the minimum wage to $9.80. Labor unions spent an estimated $174 million on the 2012 election, with 91% of the money going to Democrats, according to the Center for Responsive Politics. Now many union members could see their paychecks grow as the result of a Democrat-backed mandate—even though the overwhelming majority of scholarly evidence says that these wage increases have a negative effect on employment.

Mr. Berman is the executive director of the Center for Union Facts.

Vendor for Scoring 2015-16 Assessments

We have received this statement from the Department of Education on TNReady.

Members,

 

The department of education has executed a new contract for scoring and reporting of the 2015-16 assessments (including TNReady). After terminating the state’s contract with Measurement Inc. on April 27, the department, in collaboration with the state’s Central Procurement Office (CPO), immediately began the process of securing an emergency contract with a vendor with which the department already has an existing relationship. Pursuant to T.C.A. § 12-3-505 state agencies can purchase, in the open market, services for immediate delivery to meet emergencies arising from any unforeseen cause. In collaboration with CPO, the department has selected Pearson to score assessments from the 2015-16 school year.

Pearson is the Tennessee’s current vendor for the SAT-10 test, an optional test districts can administer in kindergarten through second grade. Also, Pearson, known for scoring NAEP (or the “Nation’s Report Card”)for three decades, is currently partnering with 25 states across the country, including Kentucky, Virginia, and Indiana. In fact, Pearson developed, administered, and scored grades 3–8 tests and/or high school End of Course exams in Tennessee from 2003 through 2014.

Our emergency contract with Pearson is only for scoring and reporting of 2015-16 assessments. This will include scoring high school End of Course exams, Part I grade 3–8 tests, and any completed Part II grade 3–8 exams. High school score reports, as well as grade 3–8 raw data, will be shared in fall 2016 as we have previously communicated.

 

Attached is an FAQ designed to answer questions about the selection of the scoring vendor.

 

The department is currently working on a separate procurement process in collaboration with CPO to select a vendor to develop and administer next year’s assessment. We will communicate information related to next year’s test as we move through the procurement process.

Tennessee Does Well on Pension Funding and Retirement Health Benefits

New GASB rules have now standardized the reporting of municipal liabilities, JP Morgan created a single measure for each state.  

Total liabilities include bonds and obligations related to underfunded pensions and retiree healthcare benefits (referred to as “OPEB”, an acronym for Other Post-Employment Retirement Benefits).  Pensions and OPEB are a big part of the debt picture: while US states have ~$500 billion of bonds supported by state tax collections and general revenues, they have another $1.0-$1.5 trillion of unfunded pension and OPEB liabilities, depending on rates used to discount them.

 

JP Morgan analyzed 330 state pension and OPEB plans.  The chart shows the ratio of what states currently spend on bonds, pensions and OPEB as a percentage of their revenues (blue bars), and what they would be spending assuming a 6% return on plan assets, amortizing any unfunded pension and OPEB liabilities over 30 years (total bars).  

As you can see - Tennessee is doing very well.

GOVERNOR ANNOUNCES NATIONAL GUARD YOUTH CHALLENGE PROGRAM

Alternative residential program part of governor’s Public Safety Action Plan

 

NASHVILLE – Tennessee Gov. Bill Haslam today announced with Major General Max Haston of the Department of Military and Department of Children’s Services (DCS) Commissioner Bonnie Hommrich that Tennessee has been approved by the U.S. Department of Defense for a National Guard Youth ChalleNGe program.

 

The National Guard Youth ChalleNGe is an alternative residential program that offers youth between ages 16-18 who have dropped out of school and have no criminal record the opportunity to learn self-discipline, leadership and responsibility while working to obtain a high school equivalency diploma outside of a traditional school setting. Its implementation is one of the steps in the governor’s Public Safety Action Plan.

 

“This program creates another path to success for some teens who really need one, and it falls right in line with our Drive to 55 goals by helping them earn high school diplomas and making them eligible for Tennessee Promise,” Haslam said. “I appreciate our Children’s Services and Military departments collaborating in an innovative way to serve these young Tennesseans and our state.” 

 

The program is voluntary, focusing on eight core components: academic excellence, physical fitness, leadership/followership, responsible citizenship, job skills, service to the community, health and hygiene and life coping skills. Program cadets are constantly monitored during a three phase instructional period. The cadets begin with a two week acclimation period followed by a 20 week residence phase and 1 year post residence “mentoring” phase.

 

“This is an exciting time for us at DCS, and the move not only makes way for the Youth ChalleNGe, it gives us an excellent opportunity to roll out our new programs to help our older youth get ready to become more independent,” Hommrich said. “They will have new opportunities for learning how to enter to the job market and for continuing their education."

 

Tennessee’s program will be known as the “Volunteer Youth ChalleNGe Academy” and will occupy the Woodland Hills Youth Development Center in Nashville operated by DCS. The department is moving its current operations at Woodland Hills to the unoccupied New Visions Youth Development Center next door. DCS expects to complete the move by early fall and has been developing Gateway to Independence, a new set of programs specifically tailored for older juvenile-justice youth who are in state custody.

 

“We wanted to bring Youth ChalleNGe to Tennessee for a number of years, and at long last, the pieces fell into place and we’ve been able to make it a reality. This is a great day for the youth of Tennessee,” Haston said.

 

The National Guard Youth Challenge was included in Haslam’s 2016-17 budget with funding of $5.7 million, of which $4.35 million comes from new federal funds, making the state’s investment $1.35 million. The Department of Military expects to have the program staff in place later this fall. The first class of cadets is projected to include 100 students and should begin by mid-2017.

 

Tennessee’s program will be the 40th in the country, joining programs in 29 states, Washington D.C., and Puerto Rico.

Tennessee Recipient of Gold Shovel Award for Second Consecutive Year

Tennessee has once again ranked among the best states in economic development by Area Development, a leading publication focused on site selection and facility planning. 

The Volunteer State along with five other states – California, Nevada, Ohio, South Carolina and Utah – are recipients of the magazine’s 2016 Gold Shovel Award in recognition of projects undertaken in 2015 creating a significant number of high-value-added new jobs as well as investment. 

- See more at: http://www.tnecd.com/news/304/tennessee-named-recipient-of-area-developments-gold-shovel-award-for-second-consecutive-year/#sthash.CbcXo7E8.dpuf

Every Student Succeeds Act (ESSA)

The Tennessee Department of Education is looking for your feedback on the new federal law Every Student Succeeds Act (ESSA). 

CLICK HERE to read more about the new law; 
http://tn.gov/education/topic/essa-compared-to-tennessee-policy   

CLICK HERE to provide your comments;
http://tn.gov/education/topic/essa-feedback-form

ABC Grant Application

ABC grant applications for the 2017 Fiscal year are due July 1, 2016 4:30 pm.

Arts Build Communities (ABC) is a program funded by the Tennessee Arts Commission and administered by three Designated Agencies in the GNRC region. ABC grants offer financial support for arts projects in all disciplines such as dance, music, opera/musical theatre, theatre, visual arts, design arts, crafts, photography, media arts, literature, interdisciplinary and folk arts.

Providing support for arts and cultural projects that positively impact communities across Tennessee, the grants are designed to help effect positive change in communities through the arts. Funding can be used for arts and cultural projects which address social issues; strengthen community engagement; target youth for after-school initiatives; enhance a community’s identity or brand; add value to tourism efforts; and encourage further economic development.

Funds awarded to a single organization in this grant category range from $500 to $2,500.

In order to be eligible, applicants must be state-recognized, 501(c)(3) non-profit organizations or government entities (including public schools and libraries) and must be able to provide a dollar-for-dollar match toward the single proposed project.

In addition, the proposed project must occur between August 16, 2016, and June 15, 2017. Any organization currently receiving Major Cultural Institution, Cultural Education Partnership, or
Partnership Support funding for FY2017 is not eligible to apply. GNRC –Sumner, Rutherford,

Trousdale, Williamson and Wilson: contact gbroemel@gnrc.org OR the TN Arts Commission web site; http://tnartscommission.org/grants/arts-build-communities-grant-2/

Metro Arts Commission: Davidson County http://www.nashville.gov/ArtsCommission/Grants/Apply-for-a-Grant/Arts-Build-Communities-Grant.aspx

Clarksville Arts and Heritage Development Council :Cheatham, Dickson, Houston, Humphreys, Montgomery, Robertson and Stewart http://www.artsandheritage.us/organizations-invited-to-apply-for-abc-grants-to-fund-artsactivities/

Lebanon Democrat Letter to the Editor

A constituent sent me a letter he wrote to the editor of the Lebanon Democrat on the Eddie Vedder incident...it is  a great letter!

Another great Bonnaroo draws to a close with multiple drug busts, and an
out-of-state musical pundit lecturing one of our representatives in absentia
like a school marm scolding a naughty child. Since many of the festival
attendees are also from elsewhere, I'm not sure how effective Mr. Vedder's
efforts will be to undercut support for Rep. Lynn's very reasonable efforts
on this issue. The wait-and-see tactic coupled with the pending multi-state
lawsuit against DOJ and DOE are mature actions that might prove more
effective than theatrical tirades in addressing this matter of bathrooms.

I am indeed incensed over this latest eruption that is actually a new front
in the "Culture Wars" which have allowed a tiny minority to lead the
mainstream of society around by the nose.  This relatively small number of
people are shaming and bullying what has become a very malleable and
complacent society into tolerating things that had generally been condemned
for eons.  Now we are expected to waive senses of modesty that are as much
innate as they are dictated by sacred writ.  For grown and properly
cultured adults we are now required to undergo a new form of potty
training.  Enough!

BOB HORNER

UPDATE ON HWY 109

I am happy to report that the final phase of the SR 109 expansion project is fully funded in the budget.  Construction will commence as soon as the land acquisition is complete – that is - the purchase of the right-of-way from the property owners that live along the side of 109. 

ROAD PLANNING PROCESS

It is not uncommon to believe that the state legislature selects which roads will be constructed - we do not - we fund TDOT's budget. TDOT plans the roads based on the priorities submitted to TDOT by regional Metropolitan Planning Organizations (MPO).

Our MPO is the Nashville area MPO; an organization made up of several counties in the Nashville region - Davidson, Maury, Robertson, Rutherford, Sumner, Williamson, and Wilson counties. It consists of a 19 member board made up of the county and city mayors from this region. 

The mayors' job on the MPO is to create the plan of prioritized road projects, and to submit these needs to TDOT.  TDOT then chooses which projects to fund in a given budget year. The General Assembly's role is to fund TDOT with state tax dollars. TDOT also receives federal tax dollars.


STATUS OF SR 109 EXPANSION PROJECT

This extremely important and very large public safety project is in the final phase.  Except for this final leg, the entirety of the road from I 65 to the north to SR 840 in the south is complete, including the new and very beautiful bridge over the Cumberland River.

Road construction projects move through 4 phases; design, environmental studies, land acquisition and then construction. 

The SR 109 project is currently in the land acquisition phase; parcels are at this time being purchased for the widening of the road.  The money for the construction phase is already budgeted and only waiting for the purchase of the land parcels to be finalized.

Several community meetings have taken place with the affected landowners and more will occur. Each parcel is a separate real estate transaction, therefore, each landowner has met with TDOT in order to understand how much land is being taken, what will happen to their driveways, and in some cases, the entire home is being purchased because the new road will leave so little frontage that the state must purchase the home as well.  Land owners are provided a plan, a purchase contract and a price.  Any disagreements over price or the taking must be worked out - sometimes in court so this process tends to take the most amount of time.

As you might imagine, it can be difficult to totally compensate someone for putting a highway in their front yard.

The engineering and the environmental studies are complete so as soon as all of the parcels are acquired, TDOT will commence construction.

The MPO and TDOT are very aware of the dangers on this road, and TDOT is working as fast as they can to come to agreeable terms with the property owners.

Unfortunately, increased traffic volume between SR 840 and I 65, coupled with increased residential growth in the area, speed and perhaps distractions have caused the accidents to escalate.  But we can all commit to slow down, to be extra courteous to other motorists and to keep our attention only on the road while the land owners are finalizing their transactions.  And most of all, please remember to pray for travel mercies for your family and for others.