Cities With Greatest Bankruptcy Risks Overwhelmingly Located in Forced-Unionism States

20 Cities That May Face Bankruptcy After Detroit – Newsmax.com

Among “the top 20 cities to watch for financial troubles in the wake of the Detroit story,” 16 are located in states without Right to Work protections for employees, and two are located in Michigan, which was forced-unionism until this spring. Image: Rex Features

Earlier this summer, Detroit became the largest city in American history to file for bankruptcy, but it may not retain this dubious “#1” ranking for long.  As Wall Street Journal senior economics writer and editorial board member Stephen Moore recently pointed out in an analysis for Newsmax.com, several of the largest cities in the U.S., including Chicago, Philadelphia, and New York, are now in danger of falling into fiscal insolvency.

And a number of small and mid-sized jurisdictions may be even worse off than these three metropolises.  Moore compiled a “worry list, based on bond ratings and other data, of the top 20 cities to watch for in the wake of the Detroit story” (see the link below).

All but four of the 20 cities, towns, counties, and school districts listed have one thing in common:  They are located in one of the 26 states lacking Right to Work protections for employees.  And two of the four exceptions are located in Michigan, a forced-unionism state until just a few months ago.

Moore noticed the fact that ins0lvent jurisdictions are located overwhelmingly in forced-unionism states.  In his view, it’s no coincidence:

What do most of these ailing cities all have in common? Well, consider that the vast majority are located in states with forced unions, non-right-to-work states.

“Right-to-work laws attract people and businesses,” says labor economist Richard Vedder of Ohio University. “Non-right-to-work states repel them.” His statistics show that cities in states with right-to-work laws have sturdier tax bases and higher employment levels.

Unions control state legislatures and city halls in non-right-to-work states, so it can become politically paralyzing to try to fix the problem of runaway labor costs.