What Do They Do?

Someone asked me in comments a while back just what exactly right to work laws do to a state's economy? Well, here's a pretty good summation. Here's the one that jumped out at me.

2) Under right-to-work laws, workers reap fewer gains from economic growth. Supporters of right-to-work laws often argue that they’ll help attract more businesses to a state. Opponents retort that weakening unions will lead to an erosion of wages. (A large Economic Policy Institute study from 2011 found that, after controlling for a host of factors, right-to-work states have lower wages on average than pro-union states.) 

Both arguments might be correct. One careful study conducted by Hofstra’s Lonnie Stevans in 2007 found that right-to-work laws do help boost the number of businesses in a state — but the gains mostly went to owners, while average wages went down. ”Although right-to-work states may be more attractive to business,” Stevans concludes, “this does not necessarily translate into enhanced economic verve in the right-to-work state if there is little ‘trickle-down’ from business owners to the non-unionized workers.” 

So business owners gain, and workers lose. One possible retort is that these states could simply set up new safety-net programs to compensate workers who are hurt. But that leads to another question: Without strong unions in place, who will push for these policies?

So, more business comes to the state but the gains go right to the owners. Paging Joseph Stiglitz!

What continues to amaze me is how the Right, supposedly "classic liberals" influenced by Adam Smith, vociferously fight for more wealthy for the modern day version of the aristocracy. Somewhere Klemens von Metternich is applauding....