"It is impossible to collectively bargain with the government..."
It wasn't Ronald Reagan or Ron Paul, but George Meany the former Director of the AFL-CIO (the largest federation of unions) said this in 1959. FDR himself called the implications of government unionization as "unthinkable."
I want to preface this blog post by saying that I believe all employees of government around the nation are hard working and provide valuable service to this country. I believe that most of them are getting a bad name for what is happening in Wisconsin, but I do want to highlight the history and facts, as I see them, of government unions, their origins, and the objective implications.
A Brief History of Government Unions
Trade Unions began as way for workers to collectively organize for better pay and working conditions in the private sector in the late 19th Century. As late as the 1950s, there were no unions for government workers. This made sense in many eyes because unions primarily were disgruntled over lack of a share of the overall profit from greedy business owners and over the odious conditions they claimed companies made them work under to turn a greater profit. So, why would government workers, who are paid by the taxpayer, need a greater share of profits or have any complaints on working conditions? The government is supposed to be made up of the intelligent and compassionate right? Isn't that why we have ceded so much power and decision-making to them over the last century? However, as they say: "that dog just doesn't hunt." Government workers do not create profit--they merely negotiate for more of your tax money.
But, as the private union movement began to grow, it was pushed in NYC and eventually to the White House. In 1962, John F. Kennedy signed into law the ability for government workers to unionize and bargain for benefits. Since that time, the number of workers engaging in private sector unions has been diminishing as workers participating in public sector unions has increased.
With only 6% of private employees now engaged in unions, the unions are becoming desperate to keep their power, dues, and money flowing. It is being accomplished through the rise of almost 38% of the government being unionized. A practice that as "unthinkable" by FDR has now become the biggest source of campaign money, organizing power, and drag on the changing the budget of the nation.
The Biggest Sham: Taxpayer Dollars
One of the biggest scandals of the government employee unions is the way it influences campaigns through your tax dollars. If I was to donate to a certain candidate during an election cycle, then that is perfectly legal, often applauded to be engaged in the political process. Hey, it's my money I can do with it what I want. Well, what if I took 100 dollars from your pocket and gave it to that same candidate? Would that be legal and applauded? Absolutely not! That would be stealing. Well, this is precisely what has happened in government employee unions and the government since they were allowed to bargain collectively in 1962. Here are some facts:
2010 Election Cycle Numbers from Three Biggest Unions:
- American Federation of State, County, and Municipal Employees (AFSCME) gave 87 million to candidates running for election. The most of any company, organization. 99.5% went to Democrats. 0.5% to Republicans.
- Service Employees International Union (SEIU) gave 44 million.
- National Education Association (NEA) gave 40 million. 96% to Democrats
Giving an estimated 250 million in volunteer time and door-to-door activity, it is very substantial. This activity would be wholly appropriate if it was their money, but it's not theirs-it is yours! It is wholly inappropriate and unwise to have collective bargaining for union members because negotiations are made with no regard for the taxpayer. The union bosses are using your taxpayer dollars to support and funnel money to candidates that will in turn increase their wages, increase their time off, and give them more benefits. Is there any wonder that all of the pension liabilities and wages are unsustainable? Is it any wonder why 160 Billion of 800 Billion Stimulus package was given to save government worker jobs for two years when only 3% was given to infrastructure?
With that history and reasoning as our backdrop, let's talk about the state of the nation and Wisconsin.
What's Happening in the Nation?
Since the beginning of the recession, the private sector has lost 7.2 million jobs while the Federal Government has gained 98,000 jobs. A 6% drop compared to a 3.5% increase. Government employees nationwide now, according to the Bureau of Economic Analysis, make double the average salary of the private sector. 120,00 vs. 60,000 average. Federal workers making over $150,00 make up 3.5% of workers compared to 0.4% in 2005. The number of employees making over $100,000 has doubled under this president. Important point to remember: those salaries are paid through the taxes generated by the private industry employees.
What's Happening in Wisconsin?
All of the implications of public sector moment have come to fruition at Madison, Wisconsin. A bill put forward by the Governor has the votes for passage, but the 19 Democratic Senators have left the State for over a week avoiding the vote. If only conservatives had done this on the health care debate!
The facts of the present in Wisconsin:
- State Employees contribute less than 1% on average to their pensions compared to virtually no pensions in the private sector.
- Average compensation for public school teacher is $89,000 for 180 calendar day school year.
- Employees contribute % on average to health premiums when the national average is 25% (I pay 25%).
- State employees to contribute 5.8% on average.
- State employees to contribute 12% on average to health premiums-still half of national average.
The most controversial measure of the bill to reign in spending in Wisconsin with the government unions and the source of most contention is the alterations to the collective bargaining agreement. Under current "fair share agreements," a government worker who does not want to join the union must still have $500 to 1,000 deducted from their paycheck to go to the union. So, Gov. Walker now makes this issue voluntary and will no longer allow unions to deduct dues right out of paychecks involuntarily. Also, he gives them the ability to negotiate for wage increases and so forth, but anything about normal inflation or stand procedure must go to the taxpayer for a referendum. It shifts the balance of power back into equilibrium, so the ultimate funder of the government employees has a say-so in the bargaining process.
Remember that in a given year there is a defined amount of tax dollars to be distributed to infrastructure, Medicaid, education, and government jobs. So, every dollar we spend on top of what is necessary is stealing money away from children on Medicaid or an increase in taxes on you. The alternative in Gov. Walker's budget would be to kick 200,00 children off Medicaid or fire 5,000+ government workers. Or do they not understand the words of the Honorable Winston Churchill: "I contend that for a nation to tax itself to prosperity is like a man standing in a bucket trying to lift himself up by the handle."
Conclusions
Our 2 million plus government workers are very good people and deserve our support and our praise. However, our nation has been living outside its means for long period of time and must face the reality of diminishing tax receipts and increasing entitlement and pension obligations that threaten our economic future. The taxpayer and the ballot box has been circumvented by the government unions and have influenced massive hiring, raises, and lavish pension benefits for state employees that cannot continue. Gov. Walker's proposal returns the balance of power of the government back to the people who fund it. We should stand with him.
In the words of Walter Williams in regard to excessive taxation: "When you legalize theft, it pays for everyone to participate. Those who don't will be losers."For the last 40+ years, the taxpayers have been the losers. This is watershed moment for the country. This is a chance to even the scorecard.
Update: An Indictment of Baby Boomer Generation
Ruth Anne Baily makes a scathing indictment of the Greatest Generation's self indulgence in this article. The irony of ironies here is that these decisions seem so distant from our generation, but will indeed have the greatest impact. In the short term, a blockage of the Governor's bill will cause him to lay of between 5,000 and 12,000 workers. The irony is that due to union contracts and the "last in-first out" agreements, the layoffs will fall overwhelmingly on the youngest workers in the field--our generation. In the long term, we will continually be saddled with a debt that we refuse to confront. We have the choice to dictate terms today, but the bond markets and creditor nations will not be so kind in the future. Here is a favorite ad of mine from across the pond. "Dad's none, Mum's eyes, Gordon Brown's debt."
Seems to me that my pick for President has always been ahead on this issue. He delivered a prophetic speech to Butler University's Commencement on the indulgence of his generation.
"We were the me-generation. We have consumed more and spent more than any other generation... We had a blast, now enjoy cleaning up our mess!" My man Mitch is right. Let's start cleaning it up in Wisconsin.
Blake
3 comments:
It is amazing to me that the State Run media overlooks that Senators running away from the vote. When, McCain questioned The One in the health care round table, The One told him pompously "we aren't campaigning anymore John." The Dems lost the election in 2010. Elections have consequences, I am still dealing with the 2008 debacle.
First off, it is called public service for a reason. Government employees are there to serve the people of the United States.
Secondly, there is not a reason to unionized against the government. 1.) You can call your representative and he can weigh your demands, thoughts, and needs with everyone else in your district. If you are in the minority (like public workers should be) or your case makes no logical sense then I guess you are SOL. 2.) Hopefully the government isn't out to screw you because its main role in a nutshell is to: "establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity"; so there is no need to unionize against it (if it fits the above description). But "When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation [...] it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness." I do believe that government is messing over the taxpayer, but at the current time it is mostly to appease the unions and other special interest (aka they are not promoting the general welfare).
Lastly, if you don't like your working conditions/salary/benefits, get out of the sandbox and go compete in the private sector where the real men play. It is important to remember government employees do NOT really pay taxes; they are paid by my taxes and your taxes but they pay none! (How can some one who is paid by the income tax actually pay the income tax--think about it) I would like to close with a quote from Murray Rothbard, one of my favorite economists, "All business spending is investment because it goes toward increasing the production of goods that will eventually be sold to consumers. But government spending is simply consumer spending for the benefit of the income, and for the whims and values, of government's politicians and bureaucrats. Taxation and government spending siphon social resources away from productive consumers who earn the money they receive, and away from their private consumption and saving, and toward consumption expenditure by unproductive politicians, bureaucrats, and their followers and subsidies."
Blake, thank you for taking the time to so thoughtfully compile all of this information into something that is easily understood. Keep it up!
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