All of the Six Highest-Ranking States For 2014 Cost of Living-Adjusted Disposable Income Per Capita Have Right to Work Laws
An ever-growing mountain of scholarly research and countless ordinary Americans’ personal experience confirm that nominal income per capita, unadjusted for regional differences in the cost of living, is quite misleading as a gauge of living standards within a state.
Forced-unionism California is a case in point.  According to the U.S. Commerce Department, last year California ranked in top 25% of states for nominal disposable personal income per capita.  Yet, as Wendell Cox, a globally recognized expert in urban planning who has lectured, for example,  at the University of Sydney, the University of Toronto, the University of Paris and London’s Institute of Economic Affairs, showed in a recent commentary, by several key standards Californians are typically far worse off than the average American.
Housing in California is so expensive, both in absolute terms and relative to the median household income, that the state now “limits the dream of homeownership principally to people either fortunate enough to have purchased their homes years ago and to the more affluent,” Cox credibly argued. Â “Many middle income residents may have to face the choice of renting permanently or moving away,” he continued. Â (To read the entire analysis, see the link below.)
Union officials and other opponents of Right to Work laws know as well as anyone else that compulsory-unionism states like California, New York, New Jersey and Connecticut are far more expensive than the national average. Â But they routinely downplay, or even try to pretend out of existence, regional disparities in the cost of living when they are attacking Right to Work laws.
Many statistics regarding incomes in Right Work and forced-unionism states cited by Big Labor propagandists ignore regional cost-of-living differences completely.  Others rely heavily on regional cost-of-living indices created by the union-label Political Economy Research Institute (PERI), which show forced-unionism strongholds like New York and New Jersey as having a cost of living far closer to the national average than do nonpartisan researchers who have no ax to grind.  Moreover, the PERI does not publicly disclose just how it calculates interstate cost of living differences.
Unlike the PERI, the Missouri Economic Research and Information Center (MERIC) relies on the highly respected Council for Community and Economic Research (C2ER) for the raw data it uses to calculate the relative cost of living in each of the 50 states.  C2ER’s metropolitan-area cost-of-living data have been cited by the U.S. Commerce Department’s Statistical Abstract and an array of other standard references.  The PERI’s cost-of-living data are cited almost exclusively by partisans of compulsory unionism.
This week, the National Institute for Labor Relations Research adjusted 2014 disposable income in the 50 states as reported by the Commerce Department in March for cost of living by using MERIC’s annual cost-of-living indices for 2014.
The Institute found that the average cost of living-adjusted disposable income per capita in Right to Work states last year was $39,919, nearly $2000 higher than the forced-unionism state average. All of the six highest-ranking states (Kansas, Nebraska, North Dakota, Texas, Virginia and Wyoming) have Right to Work laws on the books. Moreover, 11 of the 14 bottom-ranking states for cost of living-adjusted disposable income per capita lack Right to Work laws.
The strong correlation between Right to Work status and higher cost of living-adjusted disposable income does not in itself prove that Right to Work laws cause incomes to rise, but it strongly tends to discredit loud assertions by union propagandists that compulsory unionism is good for workers’ pocketbooks.
As urban-policy specialist Wendell Cox recently discussed in a commentary appearing on the Newgeography.com web site, households with children in forced-unionism California are more than four times as likely to be overcrowded as similar households nationwide. This illustrates the point that real, spendable incomes in America’s most populous state are well below the national average, even though, judging by nominal income data alone, Californians seem to be doing fine. Photo: Claudio Calligaris/Institut Economique de Montréal