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Volkswagen Plant Helped Trigger Indiana's Right to Work Push

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It isn't often that a governor will credit a German car company as a reason for a sweeping policy decision. But Indiana Gov. Mitch Daniels is citing  Volkswagen when he explained why he's now supporting a Right to Work law.

Speaking on Inside INdiana Business Television, Daniels said he was frustrated that his state was losing opportunities to compete for projects to other states that had Right to Work laws, which prevent unions from collecting mandatory dues.

One such project, according to the governor, was the assembly plant that Volkswagen opened last year in Chattanooga, Tenn.  The sought-after plant marked the return of VW to American production for the first time since the early 1990s. VW is now the world's second-biggest carmaker behind GM and ahead of Toyota.

“I couldn’t get VW to return our call,” the governor said last week. “We’ve won on Honda, we won on Toyota, we’re clearly the fastest growing automotive state, and we couldn’t even get them to talk to us.”

The Indiana governor was referring to Honda’s assembly plant in Greensburg, Ind., which opened in 2008, as well as Toyota’s two production sites. Toyota builds vehicles at its own plant in Princeton, and shares production with Subaru at its plant in Lafayette.

A Volkswagen spokesman, Tony Cervone, declined comment via email on Daniels' remarks.

Daniels, the former OMB director under President George W. Bush, is in his final year as Indiana governor. First elected in 2004, Daniels took steps early in his tenure to limit public employees' collective bargaining rights. But until late last year, he resisted efforts for Right to Work legislation, which would be the first passed by a state in two decades, and the first in the industrial Great Lakes states.

His decision to support a Right to Work law has caused an escalating debate in Indiana, which would be the nation's 23rd state to pass such a measure. Democratic lawmakers initially refused to attend hearings, even in the face of $1,000 a day fines. Daniels' state of the state address last week drew loud protests over Right to Work, although it passed the Indiana Senate on Monday.

Daniels said in the interview that the protests are justified. “Both sides ought to be heard from. I think the Democrats are within their rights to make a gesture of how strongly they felt, and to say let’s stretch this out a little further. It’s a good process and we’ll accept whatever outcome that comes.”

Daniels, by the way, is giving the Republican response tonight to President Obama's State of the Union address.

Our Changing Gears public media team has covered Right to Work extensively. Check out our stories here.