U.S. Supreme Court justices on Tuesday discussed turning the United States into a right-to-work nation regarding public sector unions.

The issue came up in a case related to union "dues skim" issues happening in Illinois, Michigan and other states around the nation.

"They were seriously considering reversing the Abood ruling," said Patrick Wright, senior legal analyst with Mackinac Center for Public Policy. "That was the case out of Michigan in which the court established that public sector employees could be forced to pay mandatory agency fees to unions."

In 1977, the U.S. Supreme Court ruled in the case Abood v. Detroit Board of Education, 431 U.S. 209, that a union shop, which is legal in the private sector, is also legal in the public sector. That case arose from a lawsuit in which public school teachers sought to overturn the requirement that they pay mandatory union fees on the grounds that they opposed public sector collective bargaining and objected to the ideological activities of the union.

Wright was at the U.S. Supreme Court in Washington, D.C., Tuesday where he watched oral arguments in Harris v. Quinn, a case involving the Illinois equivalent of Michigan's home health care dues skim.

In Michigan, Illinois, and several other states, home-based caregivers were subjected to forced unionizations. In Michigan, this happened during the administration of former Gov. Jennifer Granholm and involved a dummy employer and a mail-in election. in Illinois, it was done by executive order. Late last year, the U.S. Supreme Court agreed to take up Harris v. Quinn to determine whether such forced unionizations are constitutional.

The Mackinac Center Legal Foundation last year filed an amicus brief in Harris v. Quinn, supporting the arguments that such unionizations are not constitutional.

"Our brief centered on the situation with the home-based caregivers," Wright said. "But this morning the justices seemed focused mostly on the question of Abood and the agency fees. If the court were to reverse Abood it would essentially be the same as applying right-to-work to all public sector unions nationally."

Wright cautioned that attempting to predict what the high court might do based on oral arguments was like trying to read tea leaves. However, he said he thinks the final decision in Harris v Quinn would come down to one of the following three rulings:

It could rule that (1) Abood can be extended to home-based caregivers; (2) declare that it cannot be extended to home-based caregivers; or, (3) overturn the 1977 Abood ruling.

A decision is expected by midsummer.

Tuesday's oral arguments included exchanges between the Supreme Court justices and attorneys representing both sides in the case. Justice Anthony Kennedy and Paul M. Smith, who was representing the state of Illinois, which is defending the forced unionization, had one notable exchange,that was reported in the Court's transcript of the day's proceedings:

Justice Kennedy: "Let's assume that it's true, that a union's position necessarily affects the size of government. Is not the size of government a question on which there are fundamental political beliefs, fundamental convictions that are being sacrificed if a non-union member objects to this line of policy? Are there not other union proposals that say that state employee's salary must be a certain percentage of the total state expenditure? Does this not also involve the size of government, which is a fundamental issue of political belief?"

Smith: "Any outcome of a negotiation of a collective bargaining agreement involving public employees will involve the expenditure of public money in a variety of ways, and the outcome of that will, in that limited sense, at least, be a matter of public concern every bit as much and no more than when a government contractor . . ."

Justice Kennedy: "I'm not talking about a question of public concern. I'm talking about whether or not a union can take money from an employee who objects to the union's position on fundamental political grounds."

Smith: "Well your honor, that is what the Abood distinction between chargeable and nonchargeable . . ."

Justice Kennedy: "And I'm . . . I'm asking the justification for that under the First Amendment."

Smith: "Right. And . . ."

Justice Kennedy: "In . . . in an era where government is getting bigger and bigger, and this is becoming more and more of an important issue to more people."

Here is a full transcript of the oral arguments.

(The Mackinac Center for Public Policy is hosting a discussion at noon today about energy markets. Click here to watch that broadcast.)

According to an energy market expert, Michigan's incumbent electric utilities are misrepresenting what's happened in states that have unregulated electricity markets.

In a recent interview, Phillip R. O’Conner, president of Chicago-based PROactive Strategies, a policy analysis provider specializing in insurance and energy regulation, said that contrary to the claims by representatives of Consumers Energy (CMS) and Detroit Edison (DTE),  open competition has been a winner for residents of the states that have it.

O'Conner responded to comments made in a Jan. 11 Michigan Capitol Confidential article by a spokesman for the Michigan Jobs Energy Coalition, which represents CMS and DTE, 

The following are excerpts from the interview with O'Conner:

Q: You saw the statement the spokesman for utilities made in the article, "Bill Would Open Up Competition In Michigan's Electric Market." What is your response?

A: Yes, it tells you a lot about what the utilities in Michigan are trying to do. It's clear that they want to control the dialog. Unfortunately, what they said about Illinois in the article bears no relationship to what's really going on there. I think [those who support electric deregulation] should get together with the other side (those who oppose deregulation). They could send their best guys and we’d have a debate.

What they've done with deregulation in Illinois should be a model for states like Michigan. I can also tell you about what's really been happening in the other states where the Michigan utilities claim deregulation has been a problem.

Q: Compare the situation in Illinois where the electricity market has been deregulated about 10 years with Michigan's where electric competition has been capped at 10 percent since 2008.

A: Back at the beginning of deregulation in Illinois, Illinois consistently had the highest rates in the Midwest and many people believed nothing could be done about it. Now, Illinois has the lowest rates in the region. Look at the average rate in Illinois compared to the average rate in Michigan. The difference is 3¼ cents per kilowatt hour for residential customers. In Michigan it is 11 1/3 cents, while in Illinois it's slightly over 8 cents.

What does this mean to people in Michigan? If you want to compare the market based on 2013, it means Michigan ratepayers are paying $3 billion more annually than if they had completion.

Q: What about the other states, which, according to the Michigan utilities, are having bad experiences with electric deregulation?

A: They bring up Arizona, but what they didn't tell you was that the problem there had nothing to do with the market. In Arizona the problem was that the state constitution said only their [public service] commission could set the price of electricity. Now there are people in Arizona talking about changing their constitution.

In Montana, which has a small population, the situation was that the law was not well put together. Their problem was not caused because of electric choice. And what they said about New York was not true at all. In New York, the big supporters of deregulation are the utilities. They (Michigan utilities) said they are considering re-regulation in New York, but you can always find examples of one or two lawmakers who will take almost any position.

Q: What does the overall picture look like nationally, regarding regulated electricity market and deregulated markets?

A: Nationally, 30 states are regulated, 14 are open for competition and Michigan is one of the five that have a hybrid market. That's a big part of the problem in Michigan — it's neither fish nor fowl.

You can't really compare prices nationwide because in some regions, such as those in the Northeast, costs are just higher overall. What you have to do is compare [rate increases] against inflation. In the 14 states with competition, prices have fallen 5 percent against inflation; in the 30 that have regulated markets, rates rose 15 percent more than inflation; and in the hybrid states, like Michigan and California, it has been a disaster.

Q: What about the other states Michigan's utilities mentioned?

A: Let's talk about Texas. If someone just got on the phone and contacted the Texas Public Service Commission they'd find out the truth. Since adopting [electric] choice, Texas has added more [electric] generation than there is in all of Michigan.

In New Jersey and Maryland they have the largest single pool in the country. Deregulation has been so successful there that PJM (Pennsylvania, Jersey Maryland Electric Company) is attracting customers outside of its region.

Q: Do the utilities in some states support deregulation?

A: In the 14 states that have deregulation, the utilities are supporters of it.

Steven Transeth of the Michigan Jobs Energy Coalition did not respond to a request for comment.