We have written about unions dozens of times, and have consistently acknowleged the contributions unions have made. But over the past fifty years, the role of unions in the United States has changed in two important ways. First, most of the initial grievances that inspired workers to organize have been met; second, union power has migrated out of the private sector and into the public sector.
In our post “Unions – Ideals vs. Reality” we present a graph that illustrates the problem with unions in the public sector. Unions in the private sector bargain with companies who have to compete globally, and this is a powerful self-regulating mechanism. If the union is too aggressive, the company goes out of business because their labor costs meant they could no longer charge a competitive price for their product. In the public sector, there is no global competition, no alternative product for the taxpayer – and this means that in the public sector, unions have an unfair advantage. Unions used to be more heavily regulated in the public sector as a result, but as these regulations have been abandoned, unions have taken over the public sector.
UNIONS IN THE PUBLIC VS. PRIVATE SECTOR
|The more monopolistic an industry is,
the more their unions require regulation.
Despite powerful rhetoric to the contrary, corporations do not control most state and local governments, public sector unions do. Public sector employees make 2-4x what taxpayers make in the private sector, which is why the public sector is fiscally bankrupt – and they were bankrupt before the current financial meltdown, that just made them more bankrupt. The primary reason for public sector deficits – and rising taxes – is the cost of wages and the cost of pensions for unionized public employees who are grossly overpaid compared to the rest of us.
In order to maintain their power, public sector unions collect dues – often as much as $1,000 or more per year per member. In California, for example, nearly 4.0 million non-Federal public sector workers pay what totals nearly $4.0 billion per year in dues to public sector unions. Among other things, they use this money to indoctrinate their workforce and to control our elections. They can basically spend as much as they want to make sure their candidates win elections. Their power goes beyond this – since public employees get 50-75 paid days off per year, vs. 10-25 paid days off per year in the private sector, and since public employees retire on average 10 years earlier than private sector employees – they are far more likely to find the time to run for office.
Union influence goes far beyond just undermining the competitiveness of our private manufacturing sector and bankrupting our government. Unions also exert undue influence over management decisions. If one person can do a job, two people can do it better. If one person can do several tasks, why not turn those various tasks into several jobs requiring several people? Unions, like government bureaucracies, exist to create jobs, and not necessarily nurture innovation and efficiency. Unionizing the government is pouring fuel onto a fire.
There is nothing wrong with wanting better pay and benefits, but when the levers of government are manipulated by public sector unions so they have retirement security and early retirement, and they have generous vacation and health benefits, but the rest of us don’t, something is very wrong. We indeed have two Americas, but they aren’t rich vs. poor. They are unionized public sector workers vs. taxpaying private sector workers. That is the real two Americas – and anyone running for President on a populist economic platform like Obama should be making their campaign priority to normalize taxpayer supported benefits between the public and private sector workforces.
In this context, Obama’s position on unions is relevant. In an October 27th Wall Street Journal editorial entitled “The Election Choice: Unions” they state Obama is a co-sponsor of the “Employee Free Choice Act,” a pro-union piece of legislation that would do the following:
– Force employees to vote pro or against unionizing on an open ballot, meaning any employee who objected to being unionized would be publically identified and open to intimidation.
– Impose mandatory arbitration, meaning after 120 days if a company wouldn’t agree to union demands, an arbitrator’s decision would be final.
– Narrow the definition of a “manager” in order to put a higher percentage of a company’s employees under union control.
– Make it illegal for a company to hire new employees to replace striking employees.
Obama also supports the sinister “Public Safety Employer-Employee Cooperation Act” which will require every city over 5,000 in population to negotiate police and firefighter compensation with a national union. For a good look at what that leads to, examine pretty much any city in California – they are all facing insolvency due to the cost of paying their unionized workforces. Because it is common for these folks – before you factor in the real cost of funding their early and generous pension – to make over $100,000 per year, and many of them make over $200,000 per year. This is simply too much money for these positions – and we can make this assertion and still appreciate the work they do.
The government according to Obama – and we agree – should be working to improve the lives of all Americans. But in 21st century America, the government is working to make the lives of government workers better. This is the current legacy of unions, and Obama is going to perpetuate and worsen this divide between those of us who work in the globally competitive private sector, and our unionized public sector overlords.
What does any of this have to do with the environment? Because global warming alarm is being used to justify the biggest expansion of government in history. The taxes and fees that will pass into government hands through regulating CO2 are the only potential source of funds remotely large enough to continue to pay the unionized public sector workforce their exhorbitant, grossly unfair compensation packages.