Getting Harder For Union To Spread Teacher Pay Disinformation
'Taxpayers have a right to know where government funds are going and to whom'
In 2012, officials at Michigan’s largest teachers union used the mainstream media to spread disingenuous claims about teacher pay. Many newspapers uncritically accepted and repeated in news stories union claims of low teacher pay.
An early example was when former Michigan Education Association president Steve Cook published a claim that a teacher with a master’s degree in his second year on the job had a salary of $31,000 from Lenawee County. That claim turned out to be unfounded.
But the MEA persisted. Union spokesman Doug Pratt expanded the claim by portraying $31,000 as the average salary of all second year teachers in the state. This inaccurate claim was printed in a number of Michigan’s daily newspapers as well as far-left blogs, such as Eclectablog.
To uncover the truth then, Michigan Capitol Confidential had to submit multiple Freedom of Information Act requests asking numerous school districts for actual teacher salaries. It could take as many as 15 business days or longer for requests to be processed and answered. This meant that union misinformation could remain in the public domain unchallenged and uncorrected for many weeks.
Teacher pay is a common topic when school funding is discussed by candidates for state offices, including governor. This is understandable given that “instructional expenditures" account for about 60 percent of a typical public school’s operating expenses.
And yet the teacher salary tall-tale above is one of many inaccurate claims repeated by the mainstream media. The claims have mostly gone unchallenged because while actual public school salary data is public information, it has not been readily available on a systematic basis.
For example, in 2013 a full time teacher at the Grand Rapids school district made disingenuous claims that she could make more money as a substitute teacher, and that she qualified for a Bridge Card (food stamps). The news site MLive repeated the claims without challenge under the headline, “Grand Rapids teachers say paycheck cuts qualify them for food stamps.”
Substitute teachers in the Grand Rapids school district were paid $85 a day in 2013. To be eligible for food stamps at that level, this individual would have had to be supporting a household of seven people. However, this claim was uttered by a full time teacher who would have been earning between $216 to $243 per day in 2013 (depending on her academic credentials). But confirming that information could take weeks.
Given that such claims were frequently being made and unchallenged by the media, in 2015 Michigan Capitol Confidential’s parent organization, the Mackinac Center for Public Policy, decided to obtain a list of public school teacher salaries for the entire state that is maintained by the Michigan Office of Retirement Services (ORS). A Freedom of Information request was duly submitted and the data was turned over. In 2016 and 2017 updated versions the same information were requested and delivered.
In 2018 the pattern changed. When a request for 2018 salary information was submitted to the Office of Retirement Services, the agency sent notices to public school employees informing them that public records showing their salaries were being released to the Mackinac Center.
The Michigan Education Association also sent a letter to its officers, board members and staff advising them that it had become aware of the Mackinac Center’s open records law request.
“We want you to know that MEA is aware of those FOIA requests and is carefully monitoring the situation, both in terms of proper compliance, and, then, what the Mackinac Center is actually doing with the data," the MEA stated in an email.
Ironically, the data is often used by Michigan Capitol Confidential to correct misinformation put out by the teachers union itself.
For example, in 2016 the MEA wrote in its online magazine, “A teacher who started in the district 10 years ago still makes beginners’ pay of less than $30,000 a year…”
But salary data from the school district refuted this claim. The lowest annual salary of the district’s 106 teachers in 2015-16 was $34,000.
The Mackinac Center and Michigan Capitol Confidential are far from the only organizations tracking public employee salaries.
One of them is OpenTheBooks.com, a nonprofit whose mission is to “to capture and post all disclosed spending at every level of government.” The nonprofit has posted several years’ worth of salary data for nearly every government worker in Michigan and other states.
“Taxpayers have a right to know where government funds are going and to whom. After all, it's our money. At the federal, state, and local level, pension and retirement systems are facing a fiscal crisis,” said Adam Andrzejewski, founder of OpenTheBooks.com, in an email. “The transparency revolution is empowering citizens to hold government accountable like never before. OpenTheBooks is committed to giving the public the information they need to ask the right questions.”
The MEA didn't respond to an email seeking comment.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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State Corporate Welfare Agency Picks Winners That Turn Out To Be Losers
Program officials subsidize Cherry Growers, Inc., company goes bankrupt
This morning the Michigan Strategic Fund board hosts its monthly meeting to discuss new and old corporate handouts and very likely approve deals to subsidize more corporations with taxpayer dollars. Its use of the Michigan Business Development Program is a case in point. Mackinac Center research shows this subsidy program to be ineffective, and it should be closed.
The MBDP — which is run by the Michigan Strategic Fund with help from the Michigan Economic Development Corporation — gives cash subsidies, loans and other help to businesses it thinks are real winners. From early 2012 through September 2016, the state approved — by my count — 319 deals with an incentive value of more than $300 million, though only a little more than half has been disbursed.
One of those payouts was worth $2.5 million and went to Cherry Growers, Inc. of Grawn, near Traverse City. In 2012, the MEDC recommended that Cherry Growers receive the grant for adding 72 new jobs or more. The grant was to be repaid through "profit-participation." The MEDC projected at the time that these new jobs and related investments would yield a 3-to-1 return on the state’s investment.
Michael Finney, then president and CEO of the MEDC, used a press release to announce a deal with Cherry Growers as well as another company. It read, “The expansion of these companies further exemplifies Michigan’s improving economy and its strategy to help companies flourish and grow.” But the “winner” picked by the MEDC has since closed and is in liquidation proceedings. (As an aside, the other MBDP grant winner, in the words of one official, later “withdrew the request for the grant.”)
Cherry Growers filed for bankruptcy protection in late 2017, and has since closed and begun a liquidation process. According to the Traverse City Record Eagle, some 80 employees were let go. The sale of company assets will help compensate creditors, but how much of anything will the state claw back?
Remarkably, the MBDP subsidies were not the only taxpayer dollars at risk. As part of its deal with the state, Cherry Growers was also approved for a tax abatement by Green Lake Township. In addition, Cherry Growers has participated in a different (loan) program with the state — also in 2012 — that may further expose taxpayers to losses.
The Mackinac Center has analyzed the MBDP’s performance — not just one company — from 2012 through 2016 and finds it to be a big failure as measured by job creation.
By our count, one-third of the program’s project approvals have been or are in some stage of default or have been dismissed from the program. Some failures may be temporary and due to trivialities, such as an inability to locate the right building for the project. Others are not, however, and it appears the state is willing to amend many original agreements and lower performance thresholds.
The study also includes a statistical analysis of the program with data from the state and United States Census Bureau. We find that for every $500,000 in disbursements from the state, there is a loss of some 600 jobs in the average county hosting MBDP projects.
But the official economic development bureaucracies tell the Legislature and the state otherwise. With each deal, the MEDC or MSF prepare a forecast of how valuable their subsidy or loan will be to the state. They do so using a software package known as “REMI.” The user inputs expected performance data and the software attempts to predict detailed economic and fiscal impacts. The problem is the output may, at best, be only as good as the inputs.
In the case of Cherry Growers, the model was fed assumptions through 2022. That raises a question: Why do state officials think they can predict the economic performance of one company 10 years out when they can’t do so successfully just one month, one year or five years out?
By August 2012, a large cherry crop failure was national news. The apple crop was bad too. Yet this is just one month after MEDC jobs czars declared Cherry Growers a big winner with its grant. It was bankrupt by 2017 due in part to that bad crop.
So, we are left with the following irony. The state’s REMI software model can’t project the future because the people using it can’t do so either. This is not the first time state officials predicted great things from a subsidized company — and with the help of REMI — that went belly up not long afterward.
It must be hard to see the future when you have egg (or in this case, fruit) on your face. The state should stop trying. The market has been creating jobs and wealth long before Lansing politicians ever thought it a good idea to take everyone’s money and give it to their favored few.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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