California is in deep trouble. The state has become an economic basket case and the power of the government worker’s unions have played a key role in its demise. Just this week, the Washington Post profiled a government pensioner — a man who retired from six four-day-a-week city jobs and now makes an astonishing $520,000 a year from the taxpayers. This is why the state’s liabilities on pensions alone has been described as a pending tsunami.
First, it is clear that Right to Work states have higher rates of economic flourishing. The data Vedder studied (spanning three decades from 1977 to 2007) show a statistically significant correlation between Right to Work legislation and economic growth. And per capita income rose 23 percent more quickly in states withRight to Work legislation than in those without. Moreover, the two areas of the country that have suffered the greatest loss of jobs – namely, the Northeast and Midwest – are precisely the states with the lowest presence of Right to Work legislation.
Second, and more fascinating, the data make clear that the presence of Right to Work legislation has a positive demographic impact. From 1970-2008, the percentage of Americans living in Right to Work states rose from about 28 percent to nearly 40 percent. Put another way, during a period in which the population in the non-Right to Work states increased by about 25 percent, the population in the Right to Work states exploded by over 100 percent.