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June 2012
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Right-to-work law will change Kentucky's story

By JIM WATERS The Bluegrass Institutes


The Bluegrass Institutes

Jamestown now stands face to face with the impact of Fruit of the Loom's announcement in April that its Russell County plant is closing, which will cost the county one-third of its manufacturing jobs and hit its budget hard.

Judge-Executive Gary Robertson told me the factory's closing will shrink annual tax revenues by nearly $200,000. The county will plug that gap this year by not filling a vacant road-department position, forgoing a 1.5 percent raise for employees and using $130,000 in additional funds.

"Fortunately, this year we already had our budget in place, but next year it will be a different story," Robertson said.

When will Kentucky's story change?

Ironically, while I was in Jamestown talking to a community devastated by Fruit of the Loom's closure, Gov. Steve Beshear tweeted: "#Kentucky jumps 45 spots, now ranks 4th in the nation for having a strong entrepreneurial climate."

While I understand the need for leaders to offer up some good news, reasonable citizens should be suspicious of an index produced by the University of Nebraska-Lincoln in which a state with the nation's fifth-highest unemployment rate, a $34.7 billion unfunded public pension liability and an entire coal industry under siege jumps - in a single year - from having one of the nation's worst entrepreneurial climates to being in the nation's top five.

The index labeled its categories: "establishment growth, establishment growth per capita, business formation rates, patents per 1,000 people and income levels for non-farm proprietors."

What about "income levels" for those who work for the "proprietors?"

What kind of index would matter most to those losing their jobs by the thousands in the commonwealth's manufacturing and coal industries?

It would include categories that hard-working Kentuckians understand: employment growth, income growth and population growth, which grew between 1990 and 2011 in right-to-work states by 42.6 percent, 209.3 percent and 39.8 percent, respectively.

These figures come - not from some Nebraska university that included California and New York along with Kentucky as being among the nation's best entrepreneurial climates in its latest index - but rather from the U.S. Census Bureau and the Bureau of Economic Analysis.

Go to Jamestown and you will discover that when it comes to finding a job that will support a family and future, it's not about politics but rather the policies - including a right-to-work law - which local leaders believe will attract new companies, better jobs and fatter paychecks.

"This should not be a political or party-line issue," said Robertson, a Democrat, who believes a right-to-work law could help his community attract industries from other states.

"This should be about what's best for our fellow Kentuckians, who are looking for - and will take advantage of - opportunities when they have them," he said. "(A right-to-work law) could help us get more people working locally for good money rather than having to leave and try and find jobs elsewhere."

A substantial amount of mail I've received during this series of right-to-work columns includes complaints that federal law allowing non-union members to benefit from union representation is a major obstacle to gaining support for a right-to-work law in Kentucky.

But keep in mind that it was labor unions themselves who originally had the most influence over the crafting of federal labor laws, and yet now want to offer the perception that those same laws "force" them into representing non-dues-paying members.

If labor union bosses really wanted to change the law and allow each individual worker the freedom to accept the risk of representing themselves - even in a union shop - don't believe for one second that they couldn't get it done posthaste.

However, Kentucky - like 24 other states have already realized - cannot wait.

Fruit of the Loom will be completely closed down by the end of this year. Don't its fine workers deserve the right to work for good wages in a growing state now?

Jim Waters is president of the Bluegrass Institute, Kentucky's free market think tank.

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